Foreign trade in Latin America and the Caribbean will suffer from the economic slowdown that started in the second half of 2011. The value of regional exports will increase by 4 percent in 2012, whereas imports will grow 3 percent, according to estimates presented in a new study Wednesday.
In its annual report entitled “Latin America and the Caribbean in the World Economy 2011-2012,” a U.N. organization states that the current recession in the eurozone, the lack of economic dynamism in the United States and Japan and the modernization in China’s and other emerging economies’ growth will affect trade in the region – which, in 2012, will be 20 percentage points lower than expansion rates shown last year. The agency is the Economic Commission for Latin America and the Caribbean.
The prospects for 2012 show that foreign trade value in Mexico and Central America will grow above the regional average (7.3 percent in exports and 5 percent in imports), whereas South America will see lower rates (1.1 percent and 3.2 percent, respectively). The Caribbean countries will witness a fall in their trade exchange (-0.7 percent in exports and -2.1 percent in imports), a fact that can be explained by their strong linkages to the European Union.
According to the economic commission, Latin America and the Caribbean was the region with the highest export volumes growth in the last quarter of 2011 and the first four months of 2012, amidst the global trade slowdown. Nonetheless, the European crisis and a global risk aversion affected its export performance in the months afterwards, it said.
This slowdown has affected the exchange with the main trade partners in the region – especially regarding exports to the European Union, which fell by 5 percent in the first half of 2012 compared to the same period in 2011, the commission added. The weak export performance to the European Union will prevail for the rest of the year, although there will be differences among subregions, the report said