Declining export competitiveness: LatAm needs a quality leap

In the first quarter of 2018, the value of exports from Latin America and the Caribbean grew at a year-on-year rate of 9.7% in comparison with the same period in 2017, according to a new report from the Inter-American Development Bank (IADB).

But this growth has come amid signs that the region is becoming less competitive amid rising economic risks and global trade tensions.

The growth in exports was driven by increases in the prices of commodities such as oil and copper. In contrast, the volume of exports slowed to 3.1% during the same period, which speaks to the region's loss of market share due to declining competitiveness and the lack of high-quality exports from many countries in the region.

To estimate the loss of competitiveness, the study measures the variation in market share between 2011 and 2016, with an emphasis on intraregional exports. The region's competitiveness dropped by 7.4 percentage points during the period, which accounts for 22% of the decrease in exports.