Ecuador, Paraguay, and Argentina are the Latin American countries that could suffer the greatest negative economic impact in 2026 due to the climate phenomenon known as El Niño, the World Bank (WB) warned.
According to the "Latin America and the Caribbean Economic Outlook" report published by the organization this week, droughts linked to El Niño could disrupt production and drive up food and energy prices.
"El Niño poses additional downside risks, as droughts in some parts of the region and floods in others could affect production and increase price pressures, with Ecuador, Paraguay, and Argentina potentially facing the greatest impacts," the document explains.
The World Bank detailed that the intensification of El Niño threatens economic activity through multiple channels, ranging from droughts affecting hydroelectric generation and agriculture to episodes of excessive rainfall, prompting several countries to implement preventive plans such as issuing early warnings to vulnerable municipalities, preparing emergency supplies for rapid deployment, and securing contingent disaster financing.
The agency noted that there is a high probability of El Niño reaching its peak in late 2026. "This event, historically associated with volatility in commodity markets, carries asymmetric regional risks, as varying patterns of drought and excessive rainfall are projected for the region," it stated.
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