Exports from Latin America and the Caribbean (LAC) jumped 9.9% in 2018, the highest level in 6 years.
A few Caribbean countries performed above average, while Mexico made the most of the free trade agreement (NAFTA) it has with its North American neighbors.
The region is currently seeing several downside risks, stated the Inter-American Development Bank (IDB) in its latest assessment of the regional economics, predicting the rate of export may slow down in the months to come.
“The evolution of exports from Latin America and the Caribbean continued to be positive,” said Paolo Giordano, principal economist of the Integration and Trade Sector at the IDB and the study’s coordinator. “However, there is a slowdown trend taking place in the context of growing external risks that could weaken the export performance in the future.”
The risk factors, according to the bank, include a slowdown in the world economy, higher international interest rates, greater financial uncertainty, and more trade tensions involving major global players.
China has remained an important contributor to the region’s export growth, with shipments to the Asian giant rising 24.2% , above the increase in sales to the United States (8.6%) and interregional exports (7.8%).
Sales to the European Union rose an average 10.6% for the year but flattened sharply in the second half of the year.
Interestingly, Caribbean countries saw a stunning 24% increase in exports, while South American exports declined moderately.
Mexico and Chile experienced significant improvements. Mexico’s export volume increased from 8% in 2017 to 9% in 2018.
The region overall performed well despite there was a decline in prices for commodities including copper, soya beans, coffee, and sugar.