Urgent: Integration in Latin America Amidst Trump's Protectionism

12:00 30/01/2025 - PesoMXN.com
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Urgente: Integración en América Latina ante el Proteccionismo de Trump

PANAMA.- With the current landscape marked by protectionism and fragmentation due to the presidency of Donald Trump, the challenge for Latin America and the Caribbean is to strengthen their integration, as this region has the lowest trade volume among its own countries. Sergio Díaz-Granados, leader of the Development Bank of Latin America and the Caribbean (CAF), highlighted that the exchange of goods and services within this area barely reaches 15%.

This percentage is considerably lower compared to other regions like Europe, North Asia, and North America, where trade levels hover between 30% and 50%. "Unfortunately, Latin America and the Caribbean are in a different situation, and that represents one of our weaknesses which we need to focus on, especially now that initiatives are emerging that aim to fragment trade. The region has to work on its integration," Díaz-Granados emphasized. He also mentioned that it is crucial to seek more integration opportunities to boost local economies, noting that the energy sector could be one of the areas with the greatest potential. "We have enormous potential to attract private investment and strengthen the region by consolidating energy markets, covering everything from natural gas to hydropower," stated the president of CAF during a press conference at the first International Economic Forum on Latin America and the Caribbean taking place in Panama. He also pointed out that Latin America and the Caribbean are major exporters to China, the United States, and Europe, which are their three most important markets. Despite the tensions among these powers, the region must continue to seek collaboration with all of them. "We do not want to be a contested piece. We want to be what we have always been, a region of peace, without internal conflicts or disputes with other global blocs; our goal is to be a region that provides solutions," he asserted. Díaz-Granados concluded that in a world where trade is decreasing, the development potential is limited, and any measures that add protectionism and divide trade will lead to increased inflation.

The need for greater economic integration in Latin America is urgent, especially in a global context where protectionism threatens growth. Promoting internal trade would not only strengthen regional economies but could also diversify risks associated with dependency on unstable external markets. Collaboration in the energy sector can be a promising avenue for generating investment and economic resilience in the region.
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