Latin America outlook: Issues to watch in 2024

Summary:

This year's EPRS outlook for Latin America focuses on key developments in the region, a partner of significant importance for the European Union (EU). As part of its efforts to foster alliances around the globe, the EU has been striving since 2022 to revive relations with Latin America and the Caribbean (LAC) and 2023 was crucial for EU relations with the Community of Latin American and Caribbean States (CELAC). The leaders' summit that took place in Brussels on 17-18 July 2023 under the Spanish Presidency of the Council of the EU – eight years after the last fully fledged bi-regional summit – tried to give new impetus to the bi-regional partnership. 2024 will be a key year for the EU and its partners in terms of keeping up momentum and following up on the summit's commitments. Latin America will see six presidential elections in 2024: in El Salvador, Panama, the Dominican Republic, Mexico, Uruguay and Venezuela. The 2023 trend to vote out incumbents in favour of anti-establishment candidates, seen recently in Argentina and Guatemala, is unlikely to continue. Another focus of this year's outlook is the security situation in the Andean region, in particular Ecuador and Colombia. Ecuador, a long-time anchor of stability in the region, has experienced an explosion of violence caused by internationally operating narco gangs. For Colombia, 2024 will be decisive as regards President Gustavo Petro's 'total peace' plan. Analysts will also be keeping a close eye on how Argentina – Latin America's third-largest economy and G20 member –develops under the country's new president, right-wing populist Javier Milei. The main question is whether Argentinians will accept drastic austerity reforms, or whether these and hyperinflation will push the country towards mass demonstrations and political turmoil. Lastly, as to the economic outlook for Latin America, forecasts do not foresee any big leaps in 2024. Overall, the LAC countries are expected to stay on a path of low growth.

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