Cepal forecasts 2.2% growth for Latin America in 2026

The Economic Commission for Latin America and the Caribbean (Cepal) projects that the region will grow 2.2% in 2026, a tenth lower than its previous forecast, and 2.5% in 2027 Source: infobae. The report highlights persistent structural constraints, including low investment, weak productivity growth, and high informality, which limit the region's capacity to grow Source: infobae.

Country outlooks

• Venezuela leads with 6.5%, followed by Nicaragua (4.5%), Panama (4.4%), Paraguay (4.3%), Guatemala (4.0%), and the Dominican Republic (4.0%) Source: eldiado.
• Colombia is projected to grow 2.6% in 2026, slightly above the regional average, but its forecast was revised down from 2.7% Source: La República (CO).
• Mexico saw its forecast cut to 1.3%, down from 1.5% in April, with Cepal noting the country has been in a 'growth trap' for over 35 years Source: El Heraldo de México.
• El Salvador received an upward revision to 3.9%, half a point higher than April's estimate, driven by strong first-half activity Source: infobae.

Regional challenges

Cepal's executive secretary, José Manuel Salazar-Xirinachs, stated that the region remains trapped in three development traps: low growth, high inequality, and low institutional capacity Source: La República (CO). He emphasized the need to raise investment and productivity while advancing productive formalization Source: infobae.

The report notes that remittances have been resilient, particularly in Central America, where Honduras, El Salvador, and Guatemala saw significant growth in remittance inflows Source: infobae. However, the overall growth rate is deemed insufficient to raise per capita income or close development gaps Source: infobae.