"After a period of rapid economic growth associated with high commodity prices, the Latin America and
Caribbean region has again entered a phase of lackluster performance. Overall this slowdown seems more
self-inflicted than imported, and the outlook for the region is not encouraging either. A tepid export
response constrains the prospect of growing through external demand whereas limited fiscal space leaves
little room to stimulate domestic demand. The outlook could deteriorate further if the international
environment became less conducive.
This report explores whether inward-looking development strategies could be one of the reasons for slow
growth in Latin America and the Caribbean. Trade barriers are higher than in other developing regions, and
while numerous preferential trade agreements have been signed, many of them are intra-regional. The
report shows that South-North agreements are associated with increases in economic complexity and
faster economic growth than South-South agreements. It illustrates
