00:00And the Office of the Chief Economist of the Latin American and Caribbean at the World
00:04Bank shared the yearly economic update for the region, touching on the projected growth
00:09and the difficulties facing its economies.
00:12Through a detailed report, the Office informed that Latin America and the Caribbean entered
00:162026 with growth still constrained by long-standing structural challenges, sharing that regional
00:21GDP growth is projected to reach 2.1% this year, below the 2.4% recorded in 2025.
00:27Within this, economic growth in the Caribbean stands at 2.5% as the region's economies face
00:34high import energy costs and climate-related vulnerabilities.
00:38In this regard, the report identifies the rich natural and mineral resources of the region
00:42such as lithium, copper and a clean energy mix as assets that could position it as a potentially
00:48significant participant in the global energy transition, adding that a better managing
00:53of natural resources can be achieved through investment in skills.
00:57Local suppliers, development, and technology transfer.
01:00Moreover, the update points to the change in global environment as posing new risks for
01:04the region as uncertainty surrounds the rules of the international trade order.
01:15In this context, World Bank Group Chief Economist for Latin America and the Caribbean, William Maloney,
01:19cited the impact of the Middle East conflict in oil and gas prices as one of the main causes
01:24behind the lowering of the growth projection for the region.
01:29The immediate impacts of the crisis are through oil and gas prices globally, and that will have a direct impact,
01:40particularly on countries that choose to lessen the blow on their consumers by supporting, by subsidizing oil or gas to
01:49keep prices down.
01:50So that will have an immediate impact on the fiscal.
01:54The secondary effects are that inflation around the world is likely to regain some energy that
02:01it would slowly have been losing.
02:02And that means that the advanced countries are likely to be less aggressive in lowering their interest rates in the
02:09near future, and that's going to mean that our interest rates within the region
02:13are going to stay higher, and that increases the fiscal burden as well.
02:18So both those things are significant impacts on the fiscal and significant impacts on the economies overall, and that's why
02:27we downgraded our forecast for the region from 2.3 to 2.1 percent.
Comments