Title

International Trade Outlook for Latin America and the Caribbean

Date of Publication

2021 12:00 AM

Security Theme

Economic Stability

Keywords

srhreports, economicstability, Latin America, Caribbean, economic stability, trade, regional trade, global trade, trade partnerships, China, post-pandemic economy, regional exports, total exports

Description

"This edition of International Trade Outlook for Latin America and the Caribbean covers 2020 and is divided into three chapters. Chapter I reviews the performance of global and regional trade following the outbreak of coronavirus disease (COVID-19) in January 2020. The rapid spread of the virus and the drastic measures taken by governments to reduce the risk of contagion have hit the global economy hard, and in 2020 it will experience its worst recession since the 1930s. In this context, global trade in goods and services contracted heavily in the first half of the year, although an incipient recovery began to take shape in the second half. For the year overall, the volume of world trade in goods is projected to fall by nearly 9%, not as sharp a fall as occurred in 2009 during the global financial crisis (-13%). Although the region’s external trade in both goods and services has been hit hard by the pandemic, there has been a recovery in goods exports since June, driven mainly by an upturn in demand in China and the United States. Conversely, imports have yet to show signs of significant upturn, reflecting the severity of the recession in the region. For the year overall, the Economic Commission for Latin America and the Caribbean (ECLAC) projects falls of 13% and 20%, respectively, in the value of regional exports and imports of goods. Intraregional trade, which will be particularly badly affected, is projected to fall by 24% in value terms, with highly adverse impacts on the region’s manufacturing exports. Chapter II analyses the evolution of intraregional trade from a long-term perspective. The share of this category of trade in total exports from Latin America and the Caribbean has tended to fall since 2014, and is projected to dip to 12% in 2020. The analysis shows that integration of the region’s value chains is limited and concentrated in a few countries. In addition to low growth in the region, this has to do with the fragmentation of the regional economic space, the lack of solid institutional arrangements, the emergence of China as a trading partner and the centrifugal force exerted by trade agreements with extraregional partners. At the same time, underinvestment in infrastructure has prevented closure of provision, quality and access gaps with regard to transport infrastructure services, hampering growth, integration and competitiveness.The weakening of intraregional trade is very worrying, since for most Latin American and Caribbean countries this is the type of trade most conducive to productive and export diversification. In this context, ECLAC proposes targeting three fronts: convergence in trade facilitation; improvement of regional transport and logistics infrastructure to support a shift in investment towards more resilient, efficient and sustainable works; and cooperation on digital matters. These three areas have clear synergies and offer the potential to support the environmental big push that ECLAC has proposed for the region. Chapter III examines how international trade, supported by the right policies, can contribute to gender equality. The links between the two may be attributed in part to the intersection between productive and trade specialization, gender-based labour segregation and the sexual division of labour in different countries. Changes in the intensity of trade, in the export and import structure, and in the prices of traded products and services have differentiated distributive effects between men and women, and between different groups of women.This chapter presents new findings on the very different situations existing among export sectors with respect to female employment and its conditions. It shows that the gender wage gap is wider in export-intensive sectors than in less export-intensive ones.The COVID-19 pandemic and the temporary closure of retail commerce has affected female employment in several global value chains, in particular in tourism and the clothing industry. Chapter III also looks at how the countries of the region have gradually incorporated gender equality into their trade policies, particularly in trade agreements and in the programmes and instruments of trade promotion agencies. At the fourteenth session of the Regional Conference on Women in Latin America and the Caribbean, held in January 2020, the countries of the region agreed to implement policies and mechanisms to promote, strengthen and increase production and international trade, with a gender approach, as a pillar of countries’ economic development, and to pursue programmes to foster the creation of quality employment for women and female-led enterprise in international trade, conducting assessments of the impact on human rights of trade and investment policies and agreements from a gender equality perspective."

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Jan 1st, 12:00 AM

International Trade Outlook for Latin America and the Caribbean

"This edition of International Trade Outlook for Latin America and the Caribbean covers 2020 and is divided into three chapters. Chapter I reviews the performance of global and regional trade following the outbreak of coronavirus disease (COVID-19) in January 2020. The rapid spread of the virus and the drastic measures taken by governments to reduce the risk of contagion have hit the global economy hard, and in 2020 it will experience its worst recession since the 1930s. In this context, global trade in goods and services contracted heavily in the first half of the year, although an incipient recovery began to take shape in the second half. For the year overall, the volume of world trade in goods is projected to fall by nearly 9%, not as sharp a fall as occurred in 2009 during the global financial crisis (-13%). Although the region’s external trade in both goods and services has been hit hard by the pandemic, there has been a recovery in goods exports since June, driven mainly by an upturn in demand in China and the United States. Conversely, imports have yet to show signs of significant upturn, reflecting the severity of the recession in the region. For the year overall, the Economic Commission for Latin America and the Caribbean (ECLAC) projects falls of 13% and 20%, respectively, in the value of regional exports and imports of goods. Intraregional trade, which will be particularly badly affected, is projected to fall by 24% in value terms, with highly adverse impacts on the region’s manufacturing exports. Chapter II analyses the evolution of intraregional trade from a long-term perspective. The share of this category of trade in total exports from Latin America and the Caribbean has tended to fall since 2014, and is projected to dip to 12% in 2020. The analysis shows that integration of the region’s value chains is limited and concentrated in a few countries. In addition to low growth in the region, this has to do with the fragmentation of the regional economic space, the lack of solid institutional arrangements, the emergence of China as a trading partner and the centrifugal force exerted by trade agreements with extraregional partners. At the same time, underinvestment in infrastructure has prevented closure of provision, quality and access gaps with regard to transport infrastructure services, hampering growth, integration and competitiveness.The weakening of intraregional trade is very worrying, since for most Latin American and Caribbean countries this is the type of trade most conducive to productive and export diversification. In this context, ECLAC proposes targeting three fronts: convergence in trade facilitation; improvement of regional transport and logistics infrastructure to support a shift in investment towards more resilient, efficient and sustainable works; and cooperation on digital matters. These three areas have clear synergies and offer the potential to support the environmental big push that ECLAC has proposed for the region. Chapter III examines how international trade, supported by the right policies, can contribute to gender equality. The links between the two may be attributed in part to the intersection between productive and trade specialization, gender-based labour segregation and the sexual division of labour in different countries. Changes in the intensity of trade, in the export and import structure, and in the prices of traded products and services have differentiated distributive effects between men and women, and between different groups of women.This chapter presents new findings on the very different situations existing among export sectors with respect to female employment and its conditions. It shows that the gender wage gap is wider in export-intensive sectors than in less export-intensive ones.The COVID-19 pandemic and the temporary closure of retail commerce has affected female employment in several global value chains, in particular in tourism and the clothing industry. Chapter III also looks at how the countries of the region have gradually incorporated gender equality into their trade policies, particularly in trade agreements and in the programmes and instruments of trade promotion agencies. At the fourteenth session of the Regional Conference on Women in Latin America and the Caribbean, held in January 2020, the countries of the region agreed to implement policies and mechanisms to promote, strengthen and increase production and international trade, with a gender approach, as a pillar of countries’ economic development, and to pursue programmes to foster the creation of quality employment for women and female-led enterprise in international trade, conducting assessments of the impact on human rights of trade and investment policies and agreements from a gender equality perspective."