In 2025, Latin America and the Caribbean’s economies continue recovering from a challenging period. According to forecasts by the IMF and the UN’s Economic Commission for Latin America and the Caribbean (ECLAC), regional GDP growth is projected around 2.4–2.5%, slightly below global averages.
Nevertheless, alongside moderate economic growth, political instability persists, reducing investment appeal and slowing reforms.
Main Economic Trends in 2025
- GDP growth around 2%, with South America at 2.5%, and Central America and Mexico near 1%.
- Ongoing recovery in consumer demand fuels economic activity.
- Investments remain low, with small signs of revival.
- Inflation gradually declines but varies across countries.
- Employment shows positive trends despite low labor participation and gender inequalities.
Key Economic Indicators for Latin American Countries (2025)
| Country | GDP Growth Forecast, % | Inflation | Main Economic Drivers |
|---|---|---|---|
| Brazil | 2.3 | Moderate | Recovery of domestic demand |
| Mexico | 1.2 | Low | Export and consumer activity |
| Argentina | 4.3 | High | Industrial and consumption rebound |
| Panama | Around 4 | Low | Service sector development, export of services |
| Venezuela | Negative growth | Very high | Economic crisis and political instability |
Political Instability and Impact
- Mass protests and social tensions remain in some countries.
- Shifting political landscape complicates long-term reforms.
- Corruption and weak institutions limit effective policy.
- External risks and trade disputes add uncertainty.
Major Economic Risks for the Region
- Rising global trade tensions and tariff changes.
- Commodity price volatility critical to revenues.
- Challenges adapting to climate change and natural disasters.
- Limited funding and weak infrastructure.
Latin America in 2025 is on a path of slow but steady economic growth amid a complex political environment. Investment, institutional reforms, and effective social management are essential to strengthen the region’s position.