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Economic growth in Latin America and the Caribbean is projected to reach 2.3% in 2026 and 2.7% in 2027, according to the International Monetary Fund’s (IMF) World Economic Outlook. This projection comes in an international context marked by a global slowdown, the impact of the war in the Middle East, and rising energy and food costs. In 2025, Latin America and the Caribbean had registered growth of 2.4%.
These figures reflect a region that will continue to expand, but at a moderate pace and conditioned by external factors that are weakening global economic momentum.
A slower global environment with increased inflationary pressure
The IMF warns that the global economy will grow less than previously projected, with growth forecasts of 3.1% in 2026 and 3.2% in 2027. This will reduce the dynamism of international trade and external demand for Latin American economies.
This slower global growth coincides with rising inflation in the short term, driven primarily by higher energy and food prices following the conflict in the Middle East.
Latin America: Moderate but vulnerable growth
In Latin America, the impact will be felt mainly through three channels:
Higher input costs, especially for imported fuel and food.
Reduced foreign investment due to global uncertainty.
Tighter financial conditions, with more expensive access to international credit.
This limits the expansion capacity of the region’s economies, even in countries with relatively stable macroeconomic fundamentals. The Impact of International Prices
The rise in energy prices is one of the most sensitive factors for the region. Many Latin American economies depend on fuel imports, so any international price increase quickly translates into higher transportation, production, and consumption costs.
Added to this is the pressure on food prices, which directly impacts inflation and household purchasing power.
External risks continue to dominate the outlook.
The IMF report indicates that risks for the region remain tilted to the downside. These include a possible escalation of international conflict, renewed trade tensions, and greater fragmentation of the global economy.
These factors could further reduce projected growth, especially in emerging economies more exposed to external shocks.
Stable growth, but without significant momentum
Although Latin America is not entering a recession, the IMF describes a scenario of moderate growth, without significant acceleration in the short term. The region will continue to grow, but with structural limitations and high sensitivity to events outside its borders.
In this context, the organization emphasizes the need to strengthen macroeconomic stability, improve domestic productivity, and protect the most vulnerable sectors from rising prices.
Overall, the outlook for Latin America between 2026 and 2027 is for growth, but this is contingent on a more uncertain global environment, higher costs, and slower international economic activity.
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