Central America and Caribbean Economic Outlook
Regional growth will fall below its 2023 level this year as investment and private spending lose steam. That said, the region will outperform its prior 10-year average on rebounding exports, plus declining inflation and interest rates. Political instability and extreme weather events are downside risks, while a stronger-than-expected U.S. economy is an upside risk.
Central America and Caribbean Inflation
Inflation rose from April in May in most regional economies, barring Nicaragua, where it stabilized, plus Jamaica and Panama where it fell. Regional price pressures should average above current levels but cool from 2023 in 2024 as a whole on softer growth and the delayed effect of previous interest rate hikes. Weaker-than-expected regional currencies are an upside risk.
This chart displays Economic Growth (Real GDP, ann. var. %) for Central America and Caribbean from 2010 to 2020.
| 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|
| Public Debt (% of GDP) | 49.2 | 62.5 | 58.1 | 54.3 | - |
| Merchandise Imports (USD bn) | 121.0 | 100.2 | 137.1 | 170.6 | 164.0 |
| International Reserves (USD bn) | 61.6 | 74.2 | 80.6 | 79.5 | 84.3 |
| External Debt (% of GDP) | 66.0 | 76.5 | 71.4 | - | - |
| Merchandise Exports (USD bn) | 77.5 | 68.5 | 91.6 | 109.9 | 100.4 |
| GDP per Capita (USD) | 5,649 | 5,217 | 5,764 | 6,403 | - |
| Economic Growth (Real GDP, ann. var. %) | 2.2 | -7.3 | 7.6 | 4.7 | - |
| 3.3 | - | - | - | - | |
| 1.2 | - | - | - | - | |
| Unemployment (% of active population, aop) | 7.7 | 11.2 | 8.9 | 7.2 | - |
| Fiscal Balance (% of GDP) | -3.1 | -7.5 | -3.8 | -2.2 | - |
| Inflation (CPI, ann. var. %, aop) | 2.1 | 2.1 | 3.9 | 7.6 | 4.3 |
| Policy Interest Rate (%, eop) | 3.57 | 2.06 | 2.46 | 6.35 | 5.65 |
| 110 | 115 | 146 | 134 | 139 | |
| Current Account Balance (% of GDP) | -0.3 | 0.4 | - | - | - |