Latin America is “less exposed” to the increase in tariffs, which has “dampened trade tensions” among countries that foresee on average a “modest growth” of 2.3% in their gross domestic product (GDP) for this year, said experts from the Organization for Economic Cooperation and Development (OECD).
“The region is less exposed to the increase in tariffs. This has cushioned part of the impact of trade tensions for several countries, but the position is very unequal,” highlighted the head of the OECD Economics Directorate, Aida Caldera Sánchez within the framework of the presentation of the ‘Economic Perspectives’ report.
And Brazil, which forecasts growth of 2.4% this year, will lose momentum in 2026 with 1.7%, considering, among other factors, that its average tariff rate is the highest, above 30%, while Mexico’s is less than 10%.
Furthermore, Caldera Sánchez highlighted that, “looking forward to 2026, decelerations are already observed in most Latin American countries, except in the case of Mexico, which registers a slight gradual recovery of 1.2% and 1.7% for 2027.
Although Mexico will register one of the lowest economic growth in Latin America in 2025, with a projected GDP expansion of just 0.7%.
Regional “resilience”
The “modest growth” of the largest Latin American economies in 2025 is above the average of OECD countries, which aim for 1.7%, while the global outlook is 3.2%, which is heading for a slowdown of 2.9% in 2026, and recovery in 2027, with 3.1%.
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“The world economy has shown resilience in recent months with growth of 3.2% in the first half of this year, supported by macroeconomic policies and favorable financial conditions and anticipation of production and trade in the face of increased tariffs,” highlighted the director of the OECD Country Studies Division, Luiz de Mello.
Although he warned that this “resilience is fragile”, so a “moderation of growth” is expected, especially when the “higher tariffs” in the United States and China come into effect.
De Mello explained that the tariff impact has not been “so immediate” in the economies because there are companies that have absorbed it in their margins, and that there are also others that had “stocks of imported goods” that allowed them to “keep those goods in domestic markets without having to increase prices.”
“We are sure that in the coming months, as the margins are exhausted and the economy no longer has ways to continue transacting imported goods, the impacts will be felt,” he said after commenting that the tariff effects are already being felt in the US.
“High level of uncertainty” in Mexico slows down investment
Regarding Mexico, OECD experts pointed out that “the export engine is supporting economic activity,” and that “non-automotive exports maintain solid growth,” due to better use of the USMCA.
They also highlighted “the strong demand” from the United States” for products related to information technologies (IT) and the “dynamism of the Artificial Intelligence sector.”
On the less favorable side, they mentioned that a “high level of uncertainty” persists that is holding back investment, which comes from global factors, such as “tariffs and geopolitical tensions,” but also domestic elements such as “judicial reform” and “recent changes in independent regulators.”
With information from EFE
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