The Economic Commission for Latin America and the Caribbean (ECLAC) has warned that foreign trade in the region will suffer from the global economic slowdown that started in the second half of 2011.
In its annual report, released on Thursday and titled, Latin America and the Caribbean in the World Economy 2011-2012, the UN organization states that the current recession in Europe, the lack of economic dynamism in the United States and Japan, and the modernization in China and other emerging economies, will affect trade in the region.
The report says that regional growth in 2012 will be 20 percentage points lower than expansion rates shown last year. It states that the value of regional exports will increase by four per cent in 2012, whereas imports will grow three per cent.
The report states that the prospects for 2012 show that foreign trade value in Mexico and Central America will grow above the regional average 7.3 per cent in exports and five per cent in imports, whereas South America will see lower rates of 1.1 per cent and 3.2 per cent respectively.
The report said Caribbean countries, on the other hand, will witness a fall in their trade exchange -0.7 per cent in exports and -2.1 in imports - a fact that can be explained by their strong linkages to the European Union.
According to ECLAC, 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, it said the European crisis and a global risk aversion affected its export performance in the months afterwards.