With a drop estimated at 1.4 percent in 2014, the region has had three years of stagnant exports
Exports from Latin America will drop by about 1.4 percent in 2014, the first decline in exports since the collapse of international commerce during the 2009 financial crisis, according to a study by the Inter-American Development Bank (IDB).
The decline marks the third straight year of low performance in foreign trade, caused in part by low international commodities prices and weak international demand, according to the Latin American Trade Trends Estimates 2014.
The study reveals that although exports from the region fell, the results varied from country to country. Ten countries reported increases in sales abroad, in some cases even higher than the world average. But those numbers did not make up for the drop in exports in the rest of the countries. While some countries benefited from the economic recovery in the United States, others were negatively affected by the fall in exports to the rest of the world.
Because of its size, Brazil was the biggest contributor to the fall in exports. Argentina and Peru reported the highest rates of shrinkage, followed by Venezuela and El Salvador. Colombia, Chile and Panama suffered moderate drops. The increase in Mexico's exports was the most important because of the country's size. Exports from Nicaragua, Bolivia, Ecuador, Guatemala and Dominican Republic were the most dynamic. Honduras, Paraguay and Uruguay saw increases in exports but at a slower pace. Finally, Costa Rica exports rose, but only marginally. The study includes detailed reports for 18 Latin American nations.
Growth in exports, by selected country
(Annual growth rate, percentage, billions of US$, 2014)
These results reflect a generalized drop in the prices of basic products and the different patterns of external integration among the countries in the region. In contrast with a 3 percent increase in exports to the United States, exports within the region itself suffered the worst drop, by 8 percent. The weak economic activity in Europe led to a 4 percent drop in its demand for Latin American products. Asian imports from Latin America fell by about 5 percent because of the slower growth in the region and China's reorientation of its growth toward internal consumption.
In 2015, stronger demand from the United States should benefit the region, especially Mexico and Central America, while the lower growth rates expected in China will continue to affect the principal exporters of agricultural products and minerals in South America.