Latin America and the Caribbean's political systems are experiencing a gradual institutional decay that rarely manifests as outright democratic collapse but instead hollows out governance from within, the UNDP has warned in a new report.
ECLAC trims Latin America's 2026 growth forecast to 2.2%, warning that soaring oil prices, tighter credit and slowing global trade are locking the region into a fourth consecutive year of sluggish expansion.
The Middle East conflict has landed on Latin America at an awkward moment. After two years of gradual progress bringing inflation under control, the region's central banks now face the prospect of that effort being undone by an external conflict.
The IMF raised its 2026 growth forecast for Latin America and the Caribbean by a tenth of a percentage point to 2.3%, while cautioning that the economic consequences of the war in the Middle East will most impact the region's smaller economies.
The World Bank has cut its 2026 growth forecast for Latin America and the Caribbean to 2.1%, down from 2.4% recorded last year, warning that the region faces a toxic combination of weak investment, tight fiscal space, and productivity deficits.