The Economic Commission for Latin America and the Caribbean reported Thursday that the region’s economic slowdown will worsen next year
The Economic Commission for Latin America and the Caribbean (ECLAC) reported Thursday that, by 2023, the Dominican economy will grow 4.6%, meaning a slight decrease from the 4.7% forecast in October.
The report also indicated that the economic slowdown in the region will worsen in 2023 and that the growth rate will be 1.3%, 0.1% less than estimated in October.
The United Nations agency, based in Santiago de Chile, estimates that regional GDP will close this year with a 3.7% expansion, higher than the 3.6% forecast three months ago and far from the 6.7% registered in 2021.
According to ECLAC, the slowdown began in the second half of 2022 and reflects both “the end of the rebound effect in the recovery in 2021”, as well as “the effects of restrictive monetary policies, greater limitations in fiscal spending, lower levels of consumption and investment, and the deterioration of the external context”.
“In a context of rising global inflation, the monetary policy responses adopted at the global level have led to increases in financial volatility and risk aversion levels and, therefore, have induced lower capital flows to emerging economies,” the institution said.
In the Preliminary Overview of the Economies of Latin America and the Caribbean 2022 presented this Thursday, ECLAC points out, however, that “the expected reduction in global inflation for 2023 will tend to moderate the increases in the monetary policy rates of the main central banks.”
Avoiding another “lost decade”
The report also highlights that the recovery process of labor markets “has not allowed to eliminate the traditional gaps between men and women” and that during 2022 “both an increase in casual work and a fall in real wages have been seen.”
Debt levels also remain high, “so the fiscal space is expected to continue influencing the trajectory of public spending.”
The report added that “the risk of rising interest rates, currency depreciation and increased sovereign risk will make it difficult to finance government operations in 2023.”
To avoid a new lost decade like the one seen in 2014-2023, ECLAC calls for “innovative public policies in the productive, financial, commercial, social and care economy.”
Venezuela in the lead and Chile behind
According to the report, Venezuela (12%), Panama (8.4%) and Colombia (8%) will lead economic growth this year, followed by Uruguay (5.4%), the Dominican Republic (5.1%) and Argentina (4.9%).
In the middle of the table are the Caribbean islands (4.5%), Costa Rica (4.4%), Honduras (4.2%), Guatemala (4%), Nicaragua (3.8%), Bolivia (3.5%), Mexico (2.9%) and Brazil (2.9%).
Trailing behind are Ecuador (2.7%), Peru (2.7%), El Salvador (2.6%), Chile (2.3%), Cuba (2%), Paraguay (-0.3%) and Haiti (-2%), according to the balance.
For 2023, Venezuela continues to lead the forecasts (5%), followed by the Dominican Republic (4.6%), Panama (4.2%), Paraguay (4%), the Caribbean Islands (3.3%), Guatemala (3.2%), Uruguay (2.9%), Bolivia (2.9%), Honduras (2.7%), Costa Rica (2.6%), Peru (2.2%), Nicaragua (2.1%) and Ecuador (2%).
The countries that will grow the least next year are El Salvador (1.6%), Colombia (1.5%), Cuba (1.5%), Mexico (1.1%), Argentina (1%), Brazil (0.9%), Haiti (-0.7%) and Chile (-1.1%), according to ECLAC.
Source:
Diario Libre
