Among all regions, Latin America’s economy will experience one of the sharpest declines, growing just 2.6% this year from 6.6% in 2021.
The slowdown Latin American economies will suffer this year and next Most severe among developing country regions according to an analysis conducted by UN experts on the state of the global economy.
“In Latin America and the Caribbean, many countries are enduring increasing pressure on their external debt positions and rising costs of living. It’s a worsening problem. ” said Rebecca Grinspan, Secretary of the United Nations Agency for Trade and Development (UNCTAD) today.
The organization has presented one of the most complete documents ever produced on overlapping factors in recent years. -Pandemic, Supply Chain Disruption, War in Ukraine, Inflation- to create conditions of deep depression.
Among all regions, the Latin American economy experienced one of the steepest declines, recovering just 2.6% this year compared to 6.6% in 2021 (a recovery after bottoming out in 2020 due to the pandemic). Only % grows. According to these projections, 2023 will be even worse with growth of just 1.1%.
Latin America’s panorama follows a pattern determined by its three largest economies. Worst Predictions for Mexico and Brazil the growth rate for this year is calculated to be 1.8% in both cases, while the outlook for the latter in 2023 is even more negative (0.6%).
Argentina, the region’s third largest economy, is expected to grow another 4.1% in 2022. However, in all three cases the growth rate will be less than half that of 2021.
In Central America and the Caribbean, growth will slow to 4.1% this year, compared to 7.8% in 2021, while the economic slowdown will be more severe in South America (excluding Brazil and Argentina), compared to 9.1%. 3.1%.
The external debt burden is one of the factors of greatest concern to UNCTAD regarding Latin America’s near future. With countries on the brink of default (particularly in the Caribbean), other countries are paying very high risk premiums .
The organization’s economists conclude that tightening monetary policy further in Latin America could help mitigate inflation and currency volatility against the dollar, but at the same time it would further constrain domestic demand, pushing the economy into recession and an explosion. that there is a possibility of connection.