Economic Review | Latin America and the Caribbean April 2024

Revitalizing Growth: An Urgent Agenda for Latin America and the Caribbean

Latin America and the Caribbean has made slow but consistent progress addressing the imbalances induced by the pandemic in an international environment that is just now showing signs of stabilizing. However, challenges remain to redress fiscal imbalances, recover lost earnings power, and regain the advances in reducing poverty of the previous decade. The region’s central task, however, remains boosting lackluster growth rates. The report forecasts that regional GDP will expand by 1.6 percent in 2024. GDP growth of 2.7 and 2.6 are expected for 2025 and 2026. These rates are the lowest compared to all other regions in the world, and insufficient to drive prosperity.


Growth may be enhanced by inducing more competition in the region’s economies, combined with necessary complementary investments in firm and worker capabilities, and improvements in national innovation systems that can support the development, diffusion, and utilization of new ideas, products, and processes.

Main Messages

Chapter 1 | Convergence to Inflation Targets but Continued Low Growth

While Latin America and the Caribbran has shown less dynamism than any other region of the world, it has fully recovered GDP lost during the COVID-19 pandemic, total employment is close to full recovery—although not for all groups—and poverty has fallen below its pre-pandemic level. Yet, the region confronts a global environment that is still difficult.


Despite solid macroeconomic management in the region, prospects for growth remain low, not only because of global conditions, but also because of long unaddressed structural issues. Regional growth remains constrained by low capital accumulation and low productivity growth over the longer term.


Chapter 2 | Competition–A Missing Ingredient for Productivity and Economic Growth in Latin America and the Caribbean

Throughout the region, low competition makes consumers pay higher prices for lower-quality goods and services, reducing overall welfare, and contributes to higher inequality, as monopoly prices on essential goods and services consume relatively more of the budgets of poorer households.


Increasing the competition that LAC firms face has the potential to stimulate growth and improve consumer welfare. Competition from low-cost consumer imports can help raise the standard of living of families across the income spectrum. Competition also has the power to nudge domestic producers into adopting new products and technologies, improving productivity at the firm level. The global integration of markets has contributed to more competitive environments, facilitating the diffusion and adoption of innovations that enhance efficiency. At the same time, competing in dynamic and challenging domestic markets is the best way for firms to prepare for exporting.

Growth Outlook

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