IDB Study: AI Could Lift LatAm-Caribbean GDP 5.1%, but Wages Risk Falling
IDB research due in November projects AI could enlarge Latin America and Caribbean economies by 5.1% after a decade, but warns wages could fall sharply without worker mobility.
Broad adoption of artificial intelligence could leave the economy of Latin America and the Caribbean 5.1% larger after a decade, according to forthcoming research from the Inter-American Development Bank, though the same shift could push wages down by as much as 20.9% if workers are unable to move into jobs that expand alongside AI.
The IDB's 2026 flagship report, scheduled for release in November, also estimates that regional GDP would be only 0.3% higher under limited adoption and small productivity gains. On wages, the findings point in two directions: pay could rise by 2.3% to 5.3% if workers transition into growing sectors, but could fall by 13.5% to 20.9% if they cannot.
The IDB is the largest development lender in Latin America and the Caribbean, with 48 member countries, including 26 borrowing members in the region.
Separately, IDB President Ilan Goldfajn called for more financing, long-term purchase contracts and minimum-price protection for critical-minerals supply chains. He said minerals produced in ways that respect labor conditions and the environment should be differentiated from supply produced without those safeguards, describing a minimum price for buyers as a "buyers' club."
Goldfajn was due to discuss AI and critical minerals with regional leaders and technology executives on Monday. He did not provide details on how the club or price mechanism would work, who might participate, or whether the IDB would provide financial backing.