AI could boost LatAm, Caribbean economy 5.1% but wages may fall, IDB says

NEW YORK, Sept 21 : Broad adoption of artificial intelligence could leave the economy of Latin America and the Caribbean 5.1 per cent larger after a decade, but wages could fall by as much as 20.9 per cent if workers cannot move into jobs expanding with AI, according to forthcoming research from the Inter-American Development Bank.

The IDB’s 2026 flagship report, due in November, estimates that regional GDP could be only 0.3 per cent higher under limited adoption and small productivity gains. Wages could increase by 2.3 per cent to 5.3 per cent if workers move into jobs in expanding sectors, but fall by 13.5 per cent to 20.9 per cent if they cannot.

The IDB is the largest development lender in Latin America and the Caribbean and has 48 member countries, including 26 borrowing members in the region.

IDB President Ilan Goldfajn also 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 and referred to a minimum price for buyers as a “buyers’ club.” 

Goldfajn, who was due to discuss AI and critical minerals with regional leaders and technology executives on Monday, gave no details on how the club or price mechanism would work, who might participate or whether the IDB would provide financial backing.