Inter-American Development Bank
facebook
twitter
youtube
linkedin
instagram
Abierto al públicoBeyond BordersCaribbean Development TrendsCiudades SosteniblesEnergía para el FuturoEnfoque EducaciónFactor TrabajoGente SaludableGestión fiscalGobernarteIdeas MatterIdeas que CuentanIdeaçãoImpactoIndustrias CreativasLa Maleta AbiertaMoviliblogMás Allá de las FronterasNegocios SosteniblesPrimeros PasosPuntos sobre la iSeguridad CiudadanaSostenibilidadVolvamos a la fuente¿Y si hablamos de igualdad?Home
Citizen Security and Justice Creative Industries Development Effectiveness Early Childhood Development Education Energy Envirnment. Climate Change and Safeguards Fiscal policy and management Gender and Diversity Health Labor and pensions Open Knowledge Public management Science, Technology and Innovation  Trade and Regional Integration Urban Development and Housing Water and Sanitation
  • Skip to main content
  • Skip to secondary menu
  • Skip to primary sidebar
  • Skip to footer

Beyond Borders

  • HOME
  • CATEGORIES
    • Asia – LAC
    • Innovation and Technology
    • Investment Attraction
    • Public-Private Alliances
    • Regional Cooperation
    • Regional Integration
    • Trade & Investment Agreements
    • Trade Facilitation
    • Trade Promotion
  • Authors
  • Spanish
e-commerce

Promoting E-Commerce in Latin America and the Caribbean

October 16, 2018 by Rodrigo Andres Contreras Huerta Leave a Comment


E-commerce is an opportunity to make the global trading system more inclusive. It allows micro-, small, and medium-sized enterprises (MSMEs) to access new markets and consumers, break through geographic barriers, and cut down on intermediaries and transaction costs. An increase in e-commerce in Latin America and the Caribbean would improve the region’s competitiveness by allowing it to increase and diversify its exports and attract direct foreign investment.

What is e-commerce?

When we talk about e-commerce, we mean the sale or purchase of goods and services through computer networks, especially ones that are connected to the internet. Online networks are widely used to make and take orders and payments. Some services can also be delivered online, while goods are delivered through physical logistics networks.

E-commerce is made up of five key components: (1) consumers who have access to online information and websites; (2) e-commerce platforms that include effective search functions; (3) commercial enterprises that have reliable internet access to consumers and marketplaces; (4) financial and payment services for verifying transactions and carrying them out; and (5) express-delivery and logistics services providers that can transfer goods from vendors to consumers.

E-commerce in LAC

According to the IDB’s Trade and Integration Monitor 2017, e-commerce in LAC has grown substantially in recent years but still remains marginal. Business-to-consumer (B2C) sales in the region reached US$47 billion in 2015, 24% higher than the previous year.

However, LAC’s share in global B2C e-commerce stands at around 2%, well behind its share in global GDP (7%) and international trade in goods (6%).

Online sales accounted for between just 1% and 1.9% of the region’s total sales in 2016, far lower than the global average of 7%–8.7%. These figures, along with the fact that only half of Latin Americans are online and even fewer have access to broadband connections, show that there is enormous room for e-commerce to grow in the region.

What trade policies would favor the development of e-commerce in LAC?

For LAC to make the most of the available opportunities, it needs to implement trade policies that reduce the barriers to the development of e-commerce both at the national and regional level. This is no mean task: in comparison with traditional approaches to trade liberalization, these barriers are hard to quantify and reduce.

E-commerce is affected by both conventional barriers to trade and new hurdles that are specific to the digital economy and were not contemplated when the World Trade Organization (WTO) agreements and the majority of the region’s current trade agreements were negotiated.

Indeed, even what is known as “traditional” barriers to trade may become more complex because growth in the digital economy has blurred the distinction between trade in goods and services. This is the case, for example, with products such as books, music, and films, which can now be bought online as services.

The “traditional” measures that would favor the development of e-commerce include:

  • Implementing trade facilitation measures, particularly to eliminate hold-ups during customs procedures, cut down on processing times, and speed up goods return processes.
  • Improving logistics and distribution, including by optimizing postal and shipping regimes and strengthening physical transportation infrastructure.
  • Strengthening online payment systems.
  • Liberalizing and facilitating trade in services, with a focus on those that can be supplied digitally—such as education services, ICTs, healthcare, and certain professional services—and those that are especially relevant for the digital economy.
  • Commitments around government procurement and investment.
  • Commitments around market access for goods, especially devices that facilitate internet access such as those included in the WTO Information Technology Agreement, which several LAC countries are signatories to.
  • Nondiscriminatory technical standards.
  • Nondiscrimination commitments for digital products.

The measures that would help overcome the specific challenges of e-commerce include:

  • Developing intraregional infrastructure to improve LAC countries’ interconnectedness and foster greater internet penetration rates.
  • Preparing people and companies for the online economy and developing a digitally oriented agenda for trade promotion and investment attraction.
  • Facilitating the flow of information and data.
  • A balanced intellectual property regime.
  • Consumer protection and cyber security cooperation regimes that guarantee online transactions.
  • A tax regime that favors and facilitates e-commerce.

LAC countries are up against similar such challenges. Furthermore, due to their cross-border nature, a regional approach to these discussions is necessary to prevent the emergence of a fragmented scenario with divergent national regulations.

A regional approach would address the regulatory complexities of e-commerce, which involves multiple sectors and thus requires a significant degree of coordination and cooperation between countries and different government agencies and regulatory bodies within these.

In some cases, this regional approach could lead to regulatory harmonization if commitments and standards are set down in a binding international instrument like a trade agreement. In other cases, however, regulatory cooperation to ensure interoperability or mutual recognition between countries may be sufficient. The aims of these strategies would be to reduce the costs of cross-border transactions, incentivize investment, and increase e-commerce.

Regional integration schemes like the Pacific Alliance and MERCOSUR are ideal spaces for these talks as both are already at work on developing digital agendas. At the IDB, we have supported initiatives to promote e-commerce in the region by working directly with countries and within the Pacific Alliance.

We have also signed an agreement with the Latin American Internet Association (ALAI) to fast-track digital development and we worked with the private sector on policy recommendations through the Americas Business Dialogue. We hope that these and other efforts in the region will play a part in consolidating an ecosystem that promotes the development of e-commerce in LAC, with the support of the private sector and civil society, allowing ever-greater numbers of local firms, especially MSMEs, to become part of the digital economy.


Filed Under: Trade Facilitation, Trade Promotion Tagged With: International trade, Trade Facilitation

Rodrigo Andres Contreras Huerta

Rodrigo Contreras is a trade and integration specialist at the IDB with 15+ years’ experience in the design and implementation of trade and investment policies and regulations, including roles as international consultant, law professor, negotiator of trade agreements, legal counsel, and trade commissioner of Chile to the United States. In its current role, he works in developing and executing integration projects and knowledge products in Latin America and the Caribbean and is the coordinator of the Americas Business Dialogue (ABD), a private sector led initiative comprised of 400+ companies. Rodrigo holds a law degree from Universidad de Valparaiso (Chile) and a LL.M. from Georgetown University.

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Primary Sidebar

Follow Us

Subscribe

Search

Productivity and Trade

This space explores how trade, investment and sustainable development in strategic sectors can boost productivity and strengthen more dynamic, inclusive and resilient economies in Latin America and the Caribbean. From trade facilitation and export and investment promotion to entrepreneurship, the development of public-private synergies, agri-food systems and tourism, we address challenges and opportunities for growth in the region.

Related posts

  • Why can’t I e-buy from my neighbors?
  • How can we make digital trade more inclusive?
  • The state of e-commerce in Latin America
  • The Digital Economy Partnership Agreement, a milestone in trade negotiations
  • Trade globalization and digitalization

Categories

Footer

Banco Interamericano de Desarrollo
facebook
twitter
youtube
youtube
youtube

    Blog posts written by Bank employees:

    Copyright © Inter-American Development Bank ("IDB"). This work is licensed under a Creative Commons IGO 3.0 Attribution-NonCommercial-NoDerivatives. (CC-IGO 3.0 BY-NC-ND) license and may be reproduced with attribution to the IDB and for any non-commercial purpose. No derivative work is allowed. Any dispute related to the use of the works of the IDB that cannot be settled amicably shall be submitted to arbitration pursuant to the UNCITRAL rules. The use of the IDB's name for any purpose other than for attribution, and the use of IDB's logo shall be subject to a separate written license agreement between the IDB and the user and is not authorized as part of this CC- IGO license. Note that link provided above includes additional terms and conditions of the license.


    For blogs written by external parties:

    For questions concerning copyright for authors that are not IADB employees please complete the contact form for this blog.

    The opinions expressed in this blog are those of the authors and do not necessarily reflect the views of the IDB, its Board of Directors, or the countries they represent.

    Attribution: in addition to giving attribution to the respective author and copyright owner, as appropriate, we would appreciate if you could include a link that remits back the IDB Blogs website.



    Privacy Policy

    Copyright © 2025 · Magazine Pro on Genesis Framework · WordPress · Log in

    Banco Interamericano de Desarrollo

    Aviso Legal

    Las opiniones expresadas en estos blogs son las de los autores y no necesariamente reflejan las opiniones del Banco Interamericano de Desarrollo, sus directivas, la Asamblea de Gobernadores o sus países miembros.

    facebook
    twitter
    youtube
    This site uses cookies to optimize functionality and give you the best possible experience. If you continue to navigate this website beyond this page, cookies will be placed on your browser.
    To learn more about cookies, click here
    X
    Manage consent

    Privacy Overview

    This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
    Necessary
    Always Enabled
    Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
    Non-necessary
    Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.
    SAVE & ACCEPT