By NAN Business Editor

News Americas, WASHINGTON, D.C., Mon. Dec. 15, 2025: Caribbean Competition is weak and holding back growth across the region as well as in Latin America, according to a new flagship report released by the Inter-American Development Bank, (IDB). The report, titled Markets for Development: Improving Lives through Competition, forms part of the IDB’s Development in the Americas series, which uses rigorous data and economic analysis to outline policy priorities to boost prosperity in the region.

Competition As A Driver of Growth

FLASHBACK – People travel by bus during a nationwide blackout in Santo Domingo on November 11, 2025. Santa Domingo found itself without electricity Tuesday as the Dominican Republic’s energy company announced a blackout of unspecified scope, caused by a “transmission system failure.” (Photo by Eddy Vittini / AFP) (Photo by EDDY VITTINI/AFP via Getty Images)

One of the report’s central findings is that markets in Latin America and the Caribbean are, on average, about four times more concentrated than those in advanced economies – meaning fewer dominant firms control larger portions of goods and services. This market power translates into higher markups, limited consumer choice, and slower productivity growth, according to the Bank.

If markets across the region operated with the same level of competitive intensity as in advanced economies, the IDB estimates per-capita output (GDP per person) could rise by about 11%, while income inequality might shrink by around 6%.

Strong competition is shown to benefit not only consumers through lower prices but also workers through higher real wages and expanded employment opportunities.

Business Environment Challenges

The report highlights several structural barriers that hinder competition, including:

Market Fragmentation: High logistics costs and poor connectivity within and between markets make it harder for firms to scale and compete.

Regulatory Complexity: Excessive or poorly designed regulations discourage new entrants and protect entrenched incumbents.

Weak Institutions: Many competition authorities in the region have limited resources or independence, reducing their ability to enforce fair market rules.

These conditions contribute to the so-called “missing middle” — a shortage of medium-sized enterprises that, in more competitive economies, help drive innovation and job creation.

Implications for Businesses and Consumers

For business leaders, the findings point to a pressing need for reforms that unlock competitive pressures:

Reducing red tape and simplifying market entry

Investing in infrastructure that lowers transaction costs

Strengthening antitrust enforcement and regulatory oversight

Lower market concentration could empower small and medium-sized firms to grow, broaden supply chains, and stimulate innovation across sectors such as telecommunications, banking, and health care.

Consumers in Latin America and the Caribbean currently face markups that are estimated to be higher than in advanced markets, while workers in many sectors see wages that reflect a weaker competitive environment.

Policy Priorities and Reforms

The IDB calls on governments to pursue reforms that balance regulation with competition enhancement. Priority areas include:

Modernizing competition laws

Investing in logistics and digital connectivity

Empowering competition agencies with greater independence

Streamlining business regulations to reduce barriers for new entrants

According to the report, countries that adopt such policies may attract more domestic and foreign investment, improve productivity, and create better-paying jobs.

A Roadmap For The Region’s Future

Although Latin America and the Caribbean have achieved macroeconomic stability in recent decades, long-term productivity growth has lagged behind global peers. The IDB report provides a data-driven blueprint focused on competition as a central engine for economic dynamism – offering a new lens for policymakers and business leaders seeking to unlock latent growth potential.

For markets across the hemisphere, encouraging fair competition is not just an economic ideal – it may be the most practical path to inclusive growth and heightened prosperity in the coming decade.

By NAN Business Editor

News Americas, NEW YORK, NY, Mon. Dec. 15, 2025: China has signaled a renewed and expanded commitment to the Caribbean with new China – Caribbean Policy, positioning small island states as strategic partners in its evolving Global South diplomacy, according to its newly released Policy Paper on Latin America and the Caribbean.

Chinese President Xi Jinping (L-2) speaks during a meeting with Dominica’s President Sylvanie Burton (R-2) at the Great Hall of the People on October 14, 2025 in Beijing, China. (Photo by Ichiro Banno – Pool/Getty Images)

While much global attention has focused on China’s ties with major Latin American economies, the policy document makes clear that Caribbean nations are central beneficiaries of Beijing’s long-term development, climate, and infrastructure agenda – particularly in areas where island states face acute vulnerability and capital constraints.

A Strategic Shift Toward Small Island States

China explicitly acknowledges the Caribbean’s unique status as Small Island Developing States, (SIDS), committing to tailor cooperation frameworks that reflect climate exposure, limited fiscal space, and reliance on external trade and tourism.

Rather than a one-size-fits-all approach, the policy outlines support mechanisms designed to accommodate smaller economies, including concessional financing, development assistance without political conditionality, and targeted infrastructure investment.

This positioning signals an effort by China to distinguish its engagement from traditional Western development models, which Caribbean leaders have often criticized as restrictive or slow-moving.

Climate Resilience and Disaster Response Take Center Stage

One of the most consequential pledges for the Caribbean lies in climate adaptation and disaster resilience.

China commits to expanded cooperation in:

Disaster prevention, early warning systems, and post-disaster reconstruction

Climate-resilient infrastructure

Coastal and marine ecosystem protection

Renewable energy development, including solar, wind, and hydropower

For hurricane-prone Caribbean states facing mounting reconstruction costs and insurance gaps, these pledges could translate into tangible relief if executed at scale.

China also signals openness to supporting Caribbean climate initiatives within global frameworks, reinforcing SIDS advocacy on climate finance and loss-and-damage mechanisms.

Infrastructure, Ports and Digital Connectivity

China’s policy reinforces its interest in Caribbean infrastructure — not only roads and utilities, but also ports, logistics, digital networks, and smart city development.

The document highlights cooperation in:

Transportation and port logistics

Telecommunications and digital infrastructure

Energy grids and water systems

Housing and urban development

For Caribbean economies seeking to modernize ports, reduce shipping costs, and improve regional connectivity, Chinese-backed infrastructure could play a transformative role – particularly where traditional financing remains limited.

Trade, Investment and Market Access

On the economic front, China pledges to expand trade with Caribbean nations, especially in:

Agricultural products

Specialty goods

Energy and resource-related exports

Beijing also encourages Caribbean participation in major Chinese trade expos and investment forums, offering potential market access for Caribbean exporters seeking diversification beyond North America and Europe.

Additionally, China expresses interest in expanding financial cooperation, including local currency settlements and partnerships with regional financial institutions – a move that could reduce foreign exchange pressures for Caribbean economies.

Education, Training and People-to-People Exchanges

China’s commitments extend beyond economics into human capital development.

The policy outlines:

Scholarships and training programs for Caribbean students and professionals

Cooperation in vocational education and digital skills

Media, cultural, and academic exchanges

Support for tourism cooperation and two-way travel facilitation

For Caribbean states grappling with skills shortages and youth unemployment, these programs may offer long-term workforce benefits.

Geo-political Implications for the Caribbean

China’s expanded engagement comes as Caribbean nations navigate a shifting global order, balancing longstanding ties with the United States and Europe while exploring South-South partnerships.

By emphasizing sovereignty, non-interference, and unconditional development assistance, China positions itself as an alternative partner at a time when Caribbean governments are seeking greater diplomatic and economic autonomy.

However, the scale and impact of these pledges will depend on implementation — a point regional analysts note will be critical in distinguishing policy ambition from practical outcomes.

What Comes Next

The policy paper signals intent, not timelines. For Caribbean governments, the next phase will involve translating these pledges into:

Project-level agreements

Financing structures

Transparent procurement frameworks

Sustainable debt management

If executed effectively, China’s commitments could reshape Caribbean development pathways over the next decade, particularly in climate resilience, infrastructure modernization, and economic diversification.

For now, the message from Beijing is clear: the Caribbean is no longer peripheral in China’s Global South strategy — it is firmly on the map.