Tariff uncertainty, weak domestic consumption and a drop in investment will affect the Mexican economy, so the country’s Gross Domestic Product (GDP) would barely grow 0.4% in 2025 , estimated the Economic Commission for Latin America and the Caribbean (ECLAC) .

In presenting the Preliminary Overview of the Economies of Latin America and the Caribbean 2025 , the organization also projected that the Mexican economy could grow 1.3% in 2026 , due to factors such as greater trade certainty, as well as the possible ratification of the United States-Mexico-Canada Agreement (USMCA) and the positive effects of the World Cup on tourism.

At a press conference, José Manuel Salazar-Xirinachs, executive secretary of ECLAC, explained that low productivity growth, as well as lower investment and poor educational performance, are factors that prevent Mexico from achieving sustained growth.

“To increase its growth, Mexico must, among other things, scale up productive development policies, accelerate productive transformation, increase investment levels, and improve access to and quality of educational learning,” Salazar-Xirinachs explained.

Regarding the estimate for Latin America , ECLAC predicts that the regional GDP could reach 2.4% in 2025 and 2.3% in 2026 , which, if confirmed, would represent four years of low growth for the area.

According to the report, growth projections for 2025 and 2026 are influenced by uncertainty, mainly caused by tariffs around the world.

The report highlighted differences in the trajectories of economic activity at the subregional level, where South America would grow 2.9% in 2025 , driven by the recovery of Argentina, Bolivia and Ecuador after contractions in 2024. For 2026 a slowdown to 2.4% is projected , due to lower growth in most of its economies.

Central America is expected to grow by 2.6% this year , affected by weakening US demand, although an improvement to 3% is expected by 2026. However, vulnerabilities related to trade, remittances, access to financing, and exposure to climate change persist.

According to the preliminary assessment, the Caribbean would grow 5.5% in 2025 and 8.2% the following year , “bolstered by the significant growth of oil activity in Guyana, and supported by the normalization of tourism and improved performance in construction.”

According to the agency’s estimates, job growth will also lose momentum: 1.5% in 2025 and 1.3% in 2026. Meanwhile, regional inflation is expected to reach a median of 3% in 2026, higher than the 2.4% estimated for the end of 2025.

“The region has many assets for trading with the world, such as natural resources and productive capacities, but strategic policies are needed to realize the opportunities in Latin America and the Caribbean,” said José Manuel Salazar-Xirinachs.

The ECLAC executive secretary pointed out that the issue of uncertainty and volatility caused a lot of damage to emerging economies, and indicated that Latin America must diversify its markets and strengthen the ties with which it sustains trade exchanges .

“It is in Latin America’s best interest to diversify markets, investment, and trade, as this is necessary to achieve progress in their economies,” he noted.

ECLAC’s analysis warned that the region’s growth will depend on the dynamics observed in both global GDP growth and global trade. It will also be affected by the stance of monetary policy in the United States, uncertainty in international financial markets, and the potential volatility of external financing flows, including foreign direct investment and remittances, which could impact regional growth in 2026.

Among other factors, GDP growth can be affected by the performance of labor markets and their impact on household income.

In response, ECLAC urged strengthening and expanding the scope of macroeconomic policy .

José Manuel Salazar-Xirinachs argued that to escape the “low growth capacity trap”, more ambitious productive development policies are needed, combined with macroeconomic policies that move more resources towards growth, innovation, economic diversification, productive transformation and the creation of quality jobs.

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The tariff increases announced by the United States on April 2, which are currently on hold for 90 days, will disrupt supply chains and affect economic growth in Asia-Pacific (APAC) and around the world, Fitch Ratings warned .

In its report, US Tariff Implications for APAC Companies , the firm estimated that while few APAC companies face high sectoral vulnerability, several will be affected by a potential regional and global economic slowdown .

In this regard, he explained that exports from Vietnam, Thailand, Indonesia, Taiwan, India, South Korea, Malaysia, and Japan could face much higher US tariffs, which would harm these countries’ economic growth.

“The knock-on effects of sharp US tariff increases in this scenario could threaten even companies with qualifying headroom, as regional and global growth would likely be significantly lower than we had anticipated,” he added.

In its report, the rating agency considered that the industries most exposed to tariff risks would be the automotive, technology, mining, chemical, and metallurgical industries .

Effective tariff rates on U.S.-China trade have risen much higher than Fitch Ratings had anticipated, following retaliation by both countries, and are not yet subject to the 90-day pause.

This, along with the 10% tariff that remains in effect on all APAC exports to the United States, among other sector-specific tariffs, will hurt APAC companies selling to the United States and export-oriented economies in Asia.

Fitch Ratings indicated that the secondary effects of increased U.S. tariffs would be threatening, as regional and global growth could be lower than the firm had anticipated.

On April 2 , U.S. President  Donald Trump announced a series of reciprocal tariffs that would be applied to products entering the United States from various countries around the world.

However, on April 9 , the US president paused those tariffs for  90 days , except for China, a country with which he has a trade and tariff dispute.

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TheEconomic Commission for Latin America and the Caribbean (ECLAC) foresees a panorama of uncertainty in the economic sphere in Latin America and the Caribbean, in light of which it projected that the region will maintain low growth with an expansion of just 2.2% this year and 2.4% in 2025 , according to the Preliminary Overview of the Economies of Latin America and the Caribbean 2024 .

“This year and next year, the economies of the region will remain mired in a low-growth-capacity trap, with growth rates that will remain low and with a growth dynamic that depends on private consumption, and less on investment,” the organization stressed in the report, which was released on Wednesday.

The analysis indicated that the economy in the region will only achieve an average annual growth of 1% in the period 2015-2024, which implies a stagnation of the Gross Domestic Product (GDP) per capita during that period.

He explained that in 2025 South America would grow by 2.6% ; Central America by 2.9% ; while in the Caribbean, excluding Guyana, it would grow by 2.6 percent . In this context,  the low rate of job creation , high informality and significant gender gaps in the region’s labor markets persist .

In line with low GDP growth, employment in the region also registered a limited increase of 1.7% in 2024, the lowest recorded in the post-COVID-19 pandemic.

“Confronting the low growth capacity trap requires, on the one hand, increasing the capacity of economies to mobilize financial resources effectively, in order to strengthen resilience to economic fluctuations and, on the other, strengthening productive capacity in the medium and long term,” said José Manuel Salazar-Xirinachs , Executive Secretary of ECLAC.

Regarding informal employment, the average informal employment rate in the region is expected to stand at 46.7% , which would mean a decrease of 0.4 percentage points compared to the rate recorded in 2023.

On the other hand, after peaking in 2022, inflation in the economies of Latin America and the Caribbean has been declining . From 8.2% that year, the regional median inflation fell to 3.7% in December 2023. In addition, inflation is estimated to continue to decline in 2024, reaching 3.4 percent .

According to the Preliminary Balance 2024, among the main policies to address the low capacity for growth is the mobilization of financial resources. Domestically, strengthening public finances is required . This implies concentrating efforts on increasing tax collection and increasing its progressivity, in addition to reducing the levels of evasion in this area.

Given this scenario, ECLAC proposed strengthening the governance and technical, operational, political and prospective capacities (TOPP capacities) of macroeconomic institutions. In the area of ​​productive development policies (PDP), the organization emphasized the need to implement “new generation” policies to promote productive transformation.

He also suggested the need to identify areas with high potential to boost growth , prioritizing environmental sustainability, the promotion of science, technology and innovation, digitalization, among other factors, as well as taking advantage of global value chains to diversify economies.

In this regard, ECLAC identified 14 driving or transforming sectors grouped into three categories: industry , services and key areas for sustainability, which are priorities for the countries of Latin America and the Caribbean, since they have a high potential to boost growth and productivity.

According to the Bank of Mexico (Banxico) , the annual general inflation in the country will close at 4.36% , slightly down from the 4.42% projected in November. Meanwhile, Mexico’s GDP would close 2024 with a growth of  1.55% , although specialists warned that for the following year growth would slow down, with an estimate of  1.17 percent .

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