The economic situation is far from the official projection that had been reflected in the Budget presented last year, which pointed to a GDP growth of 2%. At that time, ECLAC had mentioned the historic drought that affected the agricultural sector, inflation, and political tussles as the main factors.
The agency released its annual report today. Economic Survey of Latin America and the Caribbean, 2023. In it, he forecasts that the region’s economies will maintain low levels of growth this year and next, affected by a global economic outlook very complex negative and regional.
According to the report -one of the main economic reports of the institution, which has been published since its inception in 1948- by 2023 a regional average GDP growth of 1.7%. Meanwhile, for 2024 a slight decrease in the growth rate is projected that would lead the regional gross domestic product to increase by 1.5%.
According to the regional organization of the United Nations, the dynamics of the World economy it remains on a path of low economic growth and global trade. Despite the drops in rate of inflation The developed countries will probably continue with their contractive monetary policies, so a significant drop in the prices cannot be expected. interest rates external sources during this year, and financing costs for our countries will continue to be high.
The public debt of the countries of the region, although it has fallen, remains at high levels with respect to GDP, which, together with the increase in foreign and domestic interest rates and an expected fall in tax revenues due to lower growth, leads to limited fiscal space for the region as a whole. In addition, less dynamism is anticipated in job creation, and growing social demands.
growth in the region
By 2023, the ECLAC projects that all subregions will exhibit a lower growth compared to 2022: South America would grow by 1.2% (3.7% in 2022), the group made up of Central America and Mexico by 3.0% (3.4% in 2022), and the Caribbean (not including Guyana) by 4 .2% (6.3% in 2022).
The projections for 2024 indicate that the low economic dynamism in the region. The international context is expected to continue to be unfavorable, with world GDP and trade growth well below historical averages. In turn, in the domestic sphere the limited space for fiscal policy will be maintained, although the reduction in inflation in the region opens more space for monetary policy in the countries. Given these circumstances, an average growth of 1.2% is projected for 2024 for South America2.1% for Central America and Mexicoand 2.8% for the Caribbean (not including Guyana).