There is an urgent need for Latin American countries to focus on investing in infrastructure, innovation and science & technology, stated the Economic Commission for Latin America and the Caribbean (ECLAC) after finding the region’s exports stagnating for the third year in succession.
In its annual report released on Thursday in the Chilean capital Santiago, the UN agency estimated that the value of the region’s exports could grow just 0.8% this year after rising 23.5% in 2011.
A decline in intra-regional trade and the decreasing demand for minerals have been blamed for the slowdown in exports.
However, thanks to their improved relationships with the United States, Mexico and Central America will see exports rise by 4.9% in value in the second half of this year, the report predicted.
The document also expressed concern over the declined role of LAC countries in international trade. “With the exception of Mexico, the region is not an important provider of non-commodities intermediate goods, nor does it carry much weight as an importer of intermediate goods originated in these world regions,” the report noted.
ECLAC has called upon the region’s countries to revise their financing policies and leverage the potential and influence of small- and medium-sized enterprises in their territory. “This will allow them to climb to rungs that have more value-added, with improvements in the innovation of processes and products,” the UN agency noted.
Concerned by the declining inter-regional trade, ECLAC has asked countries to reformulate their industrial policies to shift from “an exclusively national vision to a regional or sub-regional one.” In 2013, the percentage of the region’s exports going to countries within the same area was 19%, whereas the European Union exported 59% of its total sales to members of the same group, and Asia-Pacific countries, 50%.
“The regional market is key to developing value chains in Latin America and the Caribbean. Deepening this market is an indispensable strategy for advancing towards a global insertion that is more conducive to structural change,” said Alicia Bárcena, ECLAC’s Executive Secretary.