"The economies of the region will remain trapped in a low growth capacity trap this year and next," ECLAC said.

The Economic Commission for Latin America and the Caribbean (ECLAC) on Wednesday increased its forecast for regional GDP growth for this year to 2.2%, compared to the 1.8% estimated last August.

For 2025, the United Nations agency projected a 2.4% expansion of Latin American GDP, 0.1% more than projected in August.

"This year and next year, the economies of the region will remain mired in a low-growth-capacity trap, with growth rates that will remain low and with a growth dynamic that depends on private consumption, and less on investment," ECLAC said in the report "Preliminary Overview of the Economies of Latin America and the Caribbean 2024," presented this Wednesday in Santiago.

Over the past decade, the region's average annual growth was 1%, "which in turn implies a stagnation of GDP per capita during that period," the organization added.

To address this trap of low capacity for growth, ECLAC Executive Secretary José Manuel Salazar-Xirinachs recommended during the presentation of the report "increasing the capacity of economies to mobilize financial resources effectively in order to strengthen resilience to economic fluctuations" and "strengthen productive capacity in the medium and long term."

As for regional inflation, the agency estimated that it will close this year at 3.4%, compared to 3.7% in 2023 and the maximum of 8.2% recorded in 2022 as a result of the pandemic.

VENEZUELA AT THE HEAD AND ARGENTINA AND HAITI AT THE BOTTOM

Venezuela (6.2%), Dominican Republic (5.2%), Paraguay (4.2%) and Costa Rica (4.1%) will lead economic growth this year.

In the middle of the table are Nicaragua (3.7%), Honduras (3.6%), Guatemala (3.5%), Brazil (3.2%), Peru (3.1%), Uruguay (3.1%), El Salvador (3%), Panama (2.6%) and the Caribbean islands (2.5%) but not against Guyana, which is experiencing an oil boom.

The projection for Uruguay is very much in line with the forecasts of local economists.

At the bottom, but still with positive figures, are Chile (2.3%), Bolivia (1.7%), Colombia (1.8%), Mexico (1.4%) and Ecuador (0.8%), while Cuba (-1%), Argentina (-3.2%) and Haiti (-4%) are the only ones that will decrease this year, according to the United Nations agency.

Latin America, the most unequal region in the world, grew by 6.9% in 2021, rebounding from the pandemic, but in 2022 it slowed to 3.7% and in 2023 it closed with growth of 2.3%.