Latin America faces massive development challenges, says CAF

Alejandra Botero, Director of Investments and Financial Institutions at the Development Bank of Latin America and the Caribbean (CAF), highlighted significant developmental hurdles facing the region during the Milken Institute Global Investment Symposium 2026.

Botero noted that Latin America struggles with an informal economy of approximately 50 percent and stagnant productivity, with regional growth prospects hovering around 2.0 percent. She pointed out a critical infrastructure gap, stating that while the region should invest roughly 4.0 percent of its GDP in infrastructure, current investment levels remain below 2.0 percent.

Despite these challenges, Botero expressed optimism regarding artificial intelligence (AI) as a tool to boost productivity, particularly for micro, small, and medium-sized enterprises (MSMEs). She suggested AI could transform competitive sectors such as agri-food, energy transition, critical minerals, logistics, and infrastructure.