Tariff uncertainty, high logistics costs, and tax pressures are among the factors currently impacting international trade in Latin America; however, efforts are also underway to integrate the region into global value chains , according to industry specialists.

Paolo Giordano, principal economist of the Productivity, Trade and Innovation Sector of the Inter-American Development Bank (IDB) , recalled that despite the United States’ tariff policy during 2025, Latin American trade proved to be resilient, registering an annual growth of 6.4%, one of the highest.

“Last year, with the tariff increases, there was great concern about a slowdown or a standstill in trade, but it didn’t happen because there was an anticipation effect of the tariffs, and they also manifested themselves at a lower level than expected, so trade has been growing. It is beginning to rise structurally, although there is a lot of uncertainty,” he emphasized.

During the webinar Strategic Overview of International Trade in Latin America , organized by UPS , he reiterated that greater uncertainty is expected, “since we do not know when the next blow will come; there will be greater selectivity and trade diversion effects.”

He noted that while the commercial performance in Latin America was encouraging in 2025, now “it is a highly unstable outlook . “

César Vence, executive director of the Association of American Chambers of Commerce in Latin America and the Caribbean (AACCLA) , explained that the challenges for trade are uncertainty due to tariff measures, high logistics costs, and persistent tax pressures that affect the region’s industries.

However, he highlighted that one of the opportunities to minimize the impacts is nearshoring (relocation of production lines), digitalization, artificial intelligence (AI) and automation.

“There are many opportunities, and we are competitive in the region. We are prepared to compete globally in a different economy. Latin America is positioned between two oceans, making us a natural bridge between Europe, North America, and Asia-Pacific, with strategic proximity to the United States and shorter delivery times. In the context of nearshoring , this gives us an advantage and a decisive factor in competitiveness,” he explained.

The area, in addition to having a market of more than 650 million consumers, also has a network of strategic ports, inland terminals, dry ports and new projects.

“Latin America is investing in its logistics capacity because it sees opportunities to integrate more efficiently into global value chains. It has a more dynamic and increasingly skilled workforce in sectors such as automotive, aerospace, digital, and technology, and a wealth of natural resources,” Vence pointed out.

He reiterated that regional integration will be the way to face the current situation, and that nearshoring will continue to be important, so he called for working on public-private collaborations and understanding the dynamics of foreign trade.

María Luisa Boyce, UPS Vice President of Global Public Affairs, agreed that, despite the uncertainty, trade continues ; only the movement of goods has changed in terms of information and processes.

He also explained that tariffs have been modified, with the reciprocal tariff currently at 10% in most countries. “This presents an opportunity for exporting . “

He emphasized that companies must understand logistical efficiencies, routes, and regulations. “We need to identify opportunities to export to other regions and within the region. Trade hasn’t ended; rather, it’s essential to know, from beginning to end, how the product is being handled and what information is being provided to the authorities.”

In that regard, he considered that the review of the United States-Mexico-Canada Agreement (USMCA) represents a competitive advantage for having a more secure logistics chain.

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Following improved export prices and after having grown 2.6% in 2023, the Inter-American Development Bank (IDB) estimated that Mexican exports accelerated their pace of expansion to 4% in 2024, driven by mechanical devices, vehicles and their parts.

According to the 2025 edition of the Trade Trends Estimates for Latin America and the Caribbean report , this increase was due to demand from the United States, although Asia, especially Japan, India and Singapore, also contributed.

According to the analysis, coordinated by Paolo Giordano , sales to the remaining destinations contracted. “Mexico continued to be the engine of exports in the region. The growth rate of export values ​​accelerated, driven by better prices, while volumes grew slightly,” the study underlined.

It is explained there that the value of exports to the United States grew by 4.7% , while to Asia, not including China, it was 7 percent.

In the case of Latin America and the Caribbean, the IDB announced that the value of exports expanded 4.1% last year compared to the previous year, after falling 1.6% in 2023.

The analysis stated that this increase was due to the stabilization of export volumes. “After the contraction observed in 2023, some countries began to register signs of improvement between the end of that year and the beginning of 2024. However, the evolution was differentiated at the subregional level,” the organization pointed out.

Despite the improvement, the IDB warned that it sees no signs that guarantee the growth trend will continue, due to the uncertainty that prevails in the global economy.

“The balance of risks for regional trade remains balanced and projections point to limited growth, in a context of high uncertainty regarding the global economy,” it said.

Argentina, Venezuela, Uruguay and Guyana showed an improvement with increases of 18.1% , 18.7% , 14.6% , and 59.6% , respectively. On the other hand, among the countries that showed falls compared to the previous year were Brazil, Paraguay, Costa Rica and especially Panama, with decreases of 0.8% , 6.5% , 9.3% , and 73.3% , respectively.

The IDB report highlighted that the prices of the main commodities exported by Latin America and the Caribbean are on a downward trend, and this is expected to continue in a highly volatile environment.

In this regard, he pointed out that the price of soybeans fell by 22.1% in 2024, mainly due to the increase in global supply. Meanwhile, the price of sugar fell by 13.7% in that year.

Oil prices posted a slight negative trend throughout 2024, accumulating a contraction of 2.7% on average for the year. Iron ore prices fell by 9.2% in 2024 due to the weakness of the construction sector in China , and copper prices showed greater volatility, on average 9.4% above the level observed in 2023.

In 2024, the price of Arabica and Robusta coffee varieties was, on average, 57.7% higher than in 2023, placing the price at historic highs.

Regarding the volume of Latin American exports, the analysis estimated that in 2024 it will increase by 4% year-on-year, “marking an aggregate acceleration compared to the 2.6% average in 2023. The expansion responded mainly to the evolution of the volumes shipped by South American countries, which are estimated to have grown by 6.9 percent .”

The report predicts that looking ahead, trade performance in Latin America and the Caribbean is characterized by moderate growth prospects and high uncertainty.

Real global economic growth is expected to remain stable. However, the impact of the rebound in the region will be limited by the slowdown in China, the low level of activity in Europe and Latin America and weaker external demand compared to previous periods. “Although the region’s exports have overcome the contraction phase, there are still no signs of a sustained recovery,” the analysis detailed.

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