Redefining global trade patterns: BRICS, G7, and technological trade in Latin America

Abstract

In 2024, new members joined the original BRICS countries, reinforcing their aspirations as a relevant global actor. This study examines Latin American countries' export structures orientation towards BRICS versus G7 markets. Using a unique dataset and a structural gravity model, we estimate the determinants of export intensity with a focus on the technological content of traded goods and assess whether integration with these two blocs offers distinct pathways for upgrading into higher-value segments of trade. Our findings reveal persistent structural constraints: while both blocs demand resource-intensive exports from Latin America, opportunities to expand midand high-tech exports remain limited. Results suggest that R&D activities and domestic technological capacities do not translate into greater high-tech export performance, highlighting structural difficulties of Latin American economies moving up the value chain and that global trade remains shaped more by the nature of demand in destination markets than by technology adoption at home.