Latin America: Growth Likely to Slow Down

The Central Bank of Spain predicts a significant slowdown in economic growth in Latin America in 2023. In a recent analytical report, experts from the Central Institute of Madrid hypothesized that by the end of the year, the GDP of Latin American countries could increase by less than 1.5%, which is 2.1% lower than the 2022 results. Firstly, “almost stagnation” threatens Argentina, Brazil, Chile, Colombia, Mexico, and Peru.

According to the Spanish regulator, “a sharp slowdown in the activity of economic operators is expected.” In addition, this possible slowdown in economic growth is explained by the increasingly unfavorable global environment and the expected fall in prices for basic goods on world markets. Finally, the negative trend will be influenced by uncertainty concerning future economic policies in some countries, primarily in Brazil and Peru.

At the same time, analysts from the Bank of Spain suggested that Latin American countries could take advantage of the current context of “geopolitical fragmentation” that the world has been experiencing in recent years and invest in countries where geopolitical risks are rather low,” wrote Spanish experts who believe that “the neutral position of Latin America and the abundance of strategic raw materials could contribute to a significant increase in trade with some other major geopolitical blocs.”