Slow growth for Latin American and Caribbean economies, ECLAC says
Santiago – The Economic Commission for Latin America and the Caribbean (ECLAC) warned on Tuesday of the challenges to be faced by countries in the region when they move to reactivate investment and growth in a context of growing external and internal restrictions.
In its latest annual report titled, “Economic Survey of Latin America and the Caribbean 2022”, the United Nations organisation referred to the dynamics and challenges of investment to promote a sustainable and inclusive recovery, in which it projects economic growth for the current year of 2.7 per cent average.
It said such growth will occur in a context of strong macroeconomic restrictions that are hitting the economies of the region.
But the report stated the Caribbean (not including Guyana) was the only sub-region to grow more than last year by 4.7 per cent, compared to four per cent in the previous year.
The report noted that in the case of the Caribbean, while income has increased “it has a precarious situation with many countries such as Barbados and Belize continuing to have a huge debt”.
“So in this context of strong external restrictions, we are projecting that the region will grow 2.7 per cent, which is less than half of what it grew last year and so it will continue with that low growth path as we have seen and this year we are expecting 2.7 per cent growth and we expect that the slowdown will continue to feature,” the ECLAC report stated.
ECLAC indicated Haiti will be the only Caribbean country that will register a minus 0.2 growth.
According to the report, which was presented at a news conference in Chile, a sequence of crises has led to the scenario of low growth and inflationary acceleration presented by the global economy, which together with the lower growth of trade, the appreciation of the United States dollar, and the tightening of global financial conditions will negatively affect the countries of the region.
“In a context of multiple objectives and growing restrictions, a coordination of macroeconomic policies is required to support the acceleration of growth, investment, the reduction of poverty and inequality, while facing inflationary dynamics,” ECLAC acting executive secretary, Mario Cimoli said.
The report stated that the countries of Latin America and the Caribbean face a complex economic panorama this year and in the years to come.
Added to the lower economic growth are strong inflationary pressures, low dynamism in job creation, falls in investment, and growing social demands.
According to the report, this situation has translated into great challenges for macroeconomic policy, which must reconcile policies that promote economic reactivation with policies aimed at controlling inflation and making public finances sustainable.