Last Updated: October 12, 2023
• A group of countries in Latam is preparing a regional agreement to address inflation, a problem common to most nations in the region.
• The initiative is being spearheaded by Mexican president Andres Lopez Obrador and will allow the exchange of products with high prices between the states.
• Argentina, Brazil, Colombia, Cuba, and Mexico are all participating in this agreement to counter inflation.
Latam Countries Unite Against Inflation
A group of Latin American countries are uniting to fight against one of their biggest problems: inflation. Spearheaded by Mexican President Andres Lopez Obrador, Argentina, Brazil, Colombia, Cuba and Mexico have agreed to sign an agreement that would help counter rising prices in each country’s economy.
The agreement proposed by President Obrador would create a clearing system that would allow for fast exchange of products between the countries if certain items become more expensive in one nation than another. This could involve exchanging clothes for raw materials such as soybeans if there is an unusual increase in price for certain items within a country. It also means that no dollars would need to be exchanged in order for these transactions to take place.
Inflation Levels Across Latam
Currently Argentina has the highest levels of inflation in Latam with almost 100% rise registered during 2022 and devaluation taking its fiat currency (the Argentine peso) to historic lows. Cuba and Colombia have also experienced high levels of inflation recently but this new agreement should help lessen the effects on all participating countries.
Summit Set For March 17th
Ministers from each country have already begun organizing the structure of this anti-inflation mechanism and there is set to be a summit on March 17th where they will further discuss how it will work and what role each nation will play within it.
This new regional agreement between several Latin American countries could prove incredibly useful when it comes combating one of their biggest economic issues – inflation – across multiple nations at once if implemented correctly. There is still much planning and discussion that needs to take place before then however so it’s important to wait until after the March 17th summit before making any final judgements on its potential success or failure.