Latin America and the Caribbean: Growth is projected to edge up to 2.3% in 2024 and to 2.5% in 2025.

The Latin America and Caribbean region experienced a notable economic slowdown in 2023, with growth reaching just 2.2% amidst challenges like heightened inflation, tight monetary conditions, weak global trade, and adverse weather events. Despite these obstacles, Brazil and Mexico exceeded expectations, driven by factors such as robust agricultural production and increased exports.

Looking ahead, a gradual economic recovery is projected, with growth expected to rise to 2.3% in 2024 and 2.5% in 2025. The impact of previous monetary tightening is anticipated to diminish as central banks reduce interest rates, easing obstacles to investment growth. Country-specific projections vary, with Brazil's growth slowing in 2024 but recovering in 2025, while Mexico's growth is expected to ease due to falling inflation and weaker external demand. Argentina is projected to rebound, and Colombia's growth trajectory is set to firm.

In the Caribbean, excluding Guyana's resource boom, economies are expected to grow, driven partly by tourism expansion. Central America envisions steady growth, supported by a moderate increase in remittances.

However, the region faces persistent challenges, including declining potential for economic growth due to a slowdown in total factor productivity and an aging population. The projected modest regional expansion is also threatened by risks such as escalating geopolitical tensions, extreme weather events intensified by climate change, and external factors like persistently high global interest rates and a potential slowdown in China's growth affecting commodity exports.