By: Staff Writer
August 8, 2025
The Economic Commission for Latin America and the Caribbean (ECLAC) in their Economic Survey for Latin America and the Caribbean (LAC) 2025 said that financial resource mobilization is taking on a critical role in a post-pandemic world.
The report said: “The aftermath of the coronavirus disease (COVID-19) pandemic, tightening global financial conditions, geopolitical tensions and the effects of climate change have exacerbated the region’s structural vulnerabilities. In this context, financial resource mobilization takes on strategic importance, not only for sustaining economic stability but also for catalysing more productive, inclusive and sustainable development.
“At the Fourth International Conference on Financing for Development, held recently in Seville, Spain, the international community reaffirmed its commitment to achieving its sustainable development aspirations and increasing financing to that end, which is an opportunity that the region must seize.”
The report also said: “The region’s expansive and diverse ecosystem of development banks comprises multilateral and subregional entities in addition to more than 100 development finance institutions.
Regional and subregional development banks in Latin America focus primarily on infrastructure financing, while national banks concentrate on the financial inclusion of MSMEs, key sectors for employment and productive diversification. Development finance institutions, meanwhile, have increased their involvement in projects linked to climate action, green financing and sustainability, though national investment in these areas remains limited.
“The impact of many national banks is hampered by operational, financial and governance-related challenges. Hence, improved coordination among multilateral, regional, subregional and national development banks will be key to the alignment of efforts to meet objectives.”
Adding: “In 2025, Latin America and the Caribbean will face added external account pressures arising from emerging global risks. The correction in the current account that began in 2022 is expected to continue despite a slight deterioration of its balance, with a projected deficit of 1.1% of GDP in 2025.
“The goods and services trade balance will remain fragile, with no clear sign of stronger exports on the horizon and still-anaemic domestic demand curbing economic growth.
“Net factor income outflows will continue to squeeze the current account owing to the burden of interest payments in line with borrowing needs. Remittances will lessen this strain, helping to mitigate external imbalances, but this will only go so far amid rising factor income pressures, which are further intensified by high interest rates in an uncertain environment.”
Meanwhile the report also said that Global GDP growth is expected to slow from 3.3 percent in 2024 to around 3 percent in 2025, the lowest rate in the years following the coronavirus disease (COVID-19) pandemic. The slowdown will be widespread, affecting advanced and developing economies alike, amid heightened uncertainty and growing trade tensions. “Latin America and the Caribbean will go through another economic slowdown in 2025. After rebounding in the first two quarters of 2024, regional GDP growth lost momentum towards the end of the year, and annual growth is expected to dip from 2.3 percent in 2024 to 2.2 percent in 2025. This trend is in line with a decade of low growth: at an average of just 1.2 percent for the period 2016–2025, GDP growth is even lower than it was in the 1980s,” the report also said.