Latin American countries by GDP

The following is a list of Latin American and Caribbean countries ordered according to their gross domestic product (GDP) at purchasing power parity (PPP) values, which represents the sum of all final goods and services produced by a country in a year, adjusted to its purchasing power parity. This indicator economic was introduced in the early 1990s by the International Monetary Fund to compare more realistically the standard of living among different Latin American countries.
Purchasing power parity is one of the most appropriate measures for comparing standards of living, in contrast to per capita gross domestic product, since it takes into account changes in prices . This indicator eliminates the currency illusion related to fluctuations in the exchange rates , so that a appreciation or depreciation of a currency will not affect the purchasing power parity of a country, since the inhabitants of that country receive their wages and make their purchases in the same currency. In other words, it allows the exchange rates between the various currencies to be such that a currency has the same purchasing power anywhere in the world during the same year.
It should be noted that the data used by the International Monetary Fund correspond to economic prospects or forecasts, while the information provided by the World Bank is definitive and used by the UN . To analyze a country's economic development and living conditions, data from the World Bank are usually used, while for long-term analysis and with a macroeconomic focus, it is preferable to use data from the IMF .
The International Comparison Program (ICP), in which the Economic Commission for Latin America and the Caribbean (ECLAC) participates, today published the new Purchasing Power Parities (PPP) for the 2021 cycle.
According to the results, Latin America and the Caribbean represents 7.3% of the global Gross Domestic Product (GDP) and 8% of the world's population. This report is based on data collected during the 2021 cycle, in collaboration with ECLAC.
The results show that the size of the world economy was nearly $152.4 trillion measured in PPP terms. More than half of the world's total output came from low- and middle-income economies.
The world's largest economy in 2021 was China, with a GDP measured in PPP of $28.8 trillion, representing 18.9% of world GDP. The United States ranked second, with almost $23.6 trillion (15.5% of world GDP), while India ranked third, with $11.0 trillion, representing 7.2%. These three economies accounted for 41% of the world's population and 42% of world GDP based on PPP.
In Latin America and the Caribbean, Brazil, with US$3.7 trillion, and Mexico, with US$2.7 trillion, were the two largest economies in the region. Together, they contributed 57% of regional GDP, which, in turn, contributed 7.3% of global GDP.
The ICP is one of the most important global statistical initiatives, coordinated by the World Bank under the auspices of the United Nations Statistical Commission. The 2021 cycle of the ICP is the tenth comparison since the initiative was launched more than 50 years ago and provides information on 176 participating economies, including 39 countries in Latin America and the Caribbean.
ECLAC has coordinated the implementation of the Program in the region since 2011, although its participation dates back to 2005.
According to these results, globally, the average real GDP per capita for all participating countries was approximately $20,271 in 2021. The highest level was found in North America (over $69,423), while the lowest was recorded in Sub-Saharan Africa (just over $4,430). About three-quarters of the global population lives in economies with per capita expenditure below the world average.
For the Latin America and Caribbean region, GDP per capita averaged US$18,560, below the global average of US$20,271, and with wide heterogeneity among countries.
The report adds that average material well-being, calculated by Effective Individual Consumption (AIC) per capita, was US$13,842 for the region, slightly above the world average of US$12,948.
In addition, detailed information is presented on other spending components, such as investment. In per capita terms, high-income economies spent 2.6 times the world average on investment, while upper-middle-income economies were slightly above the world average. Lower-middle-income economies spent about one-third, and low-income economies less than one-tenth of the world average per capita investment spending.
The complete set of data referring to GDP and its main components (household and government consumption expenditures, gross fixed capital formation and domestic absorption) can be found on the World Bank's website  dedicated to ICP results.
During the second half of 2024 ECLAC will publish a detailed analysis with the results of this cycle for the Latin American and Caribbean region, which will include a description of the methodologies used.

Written by Luis