Value of Latin American exports fell 2.2% in 2023

The dollar value of goods exports from Latin America and the Caribbean fell 2.2% after two years of increase, according to a report published this Tuesday by the Inter-American Development Bank (IDB).

The drop in the price of exports was widespread throughout the region but was more pronounced in South American countries, the report highlighted.

These figures come after the value of the region’s external sales increased by 17% in 2022 and 28% in 2021, according to IDB data.

“After two years of expansion, within the framework of the recovery from the shock caused by the pandemic, exports from Latin America and the Caribbean entered a phase of contraction in 2023″explained the main economist of the Organization’s Integration and Trade Sector, Paolo Giordano, in a statement.

As a consequence of the drop in the value of exports, exports as such and the volume of shipments as such also decreased, as highlighted in the letter.

Specifically, the prices of the main basic products that are exported by the region fell in 2023.

The prices of the main basic products exported by the region contracted in 2023, except for sugar, which had a year-on-year variation rate of 27.2% and coffee, whose price remained stable.

In contrast, the interannual variation rate of the values ​​of other products was negative, such as oil (-16.7%), soybeans (-8.6%), copper (-3.6%) and iron (-0.9% ), the report detailed.

The fall in the prices of these basic products, highlighted the IDB, explains the sharp decrease in the value of exports in several countries in the south of the continent, which was the subregion most affected by this trend.

Argentina, where the value of exports fell by -25.3% compared to last year, is the country that experienced the largest drop in the value of its external sales, followed by Bolivia (-21%), Uruguay (-19% ) and Colombia (-13.7%).

Exports in Mexico, for their part, registered an increase of 2.9%, which the report attributed, “almost entirely” to increased shipments to the United States.

In Central America, for its part, exports stagnated and only Costa Rica (16.4%) and Panama (4%) showed a positive annual variation rate in their shipments abroad.

The report predicts that this downward trend in the price of imports will continue, due to the “restrictive monetary policies to contain inflation” imposed by the governments of the region, added to the war in Ukraine and the worsening of the conflict in the Gaza Strip.

“A context of growing geoeconomic fragmentation limits economic growth and, therefore, the possibilities of expanding demand for exports in the region,” said the IDB.