Digital trade could drive next growth wave in Latin America and the Caribbean | Report

Digital trade in Latin America and the Caribbean has quintupled over two decades to nearly $90 billion, emerging as a powerful engine of growth that is opening new opportunities for businesses, workers, and entrepreneurs across the region. The finding comes from a joint analysis released by the Inter-American Development Bank (IDB), the World Trade Organization (WTO), and the World Bank Group, according to a press release. Titled Digital Trade in Latin America and the Caribbean: Connecting Markets, Powering Growth, the report examines how digital technologies are reshaping trade flows. It also identifies the policies needed to unlock their full potential. The publication frames digital trade as central to boosting growth and competitiveness in the region.

Digital trade refers to international trade that is ordered or delivered online. The region’s exports of digitally delivered services nearly quintupled from $18.5 billion in 2005 to $87.7 billion in 2024. The report notes the growing weight of these services in the region’s overall trade performance and economic growth. Digital services are lowering barriers to international markets, reducing costs, and accelerating innovation. Digital platforms are also enabling small businesses, entrepreneurs, and women-led firms to reach customers worldwide.

Despite this progress, the region captured only 2% of global exports of digitally delivered services in 2024. Brazil, Mexico, Costa Rica, and Argentina have emerged as regional leaders in this area. Foreign direct investment in digitally enabled industries is helping strengthen capabilities and competitiveness across the region. The report also highlights room for deeper regional integration, noting that in 2023 only 8.4% of exports of digitally deliverable services stayed within the region. That share remains well below levels seen in Europe and Asia.

“Latin America and the Caribbean countries have substantially increased their exports of digitally delivered services in recent decades, but there is still significant potential to expand them further,” said Fabrizio Opertti, manager of the Productivity, Trade and Innovation Sector at the IDB. He added that countries need to improve connectivity, modernize regulatory frameworks, and streamline and digitalize border procedures. He also pointed to the need to reduce information barriers through stronger trade promotion. Strengthening the digital capabilities of firms and workers was cited as another priority. Persistent challenges include fragmented regulations, limited payment system interoperability, customs bottlenecks, digital skills shortages, and insufficient financing for innovative firms.

To address these gaps, the report calls for action in eight key areas. These include expanding digital infrastructure, strengthening and modernizing regulations, and improving payment interoperability. The agenda also covers streamlining trade procedures, promoting digital exports, and strengthening digital skills. Increasing access to finance and improving the measurement of digital trade round out the priorities. The report concludes that governments, businesses, and international organizations must work together to expand the region’s participation in digital trade.