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| ECLAC’s executive secretary Alicia Bárcena |
SANTIAGO,
Chile, Wednesday December 12, 2012 - The Economic Commission for Latin America
and the Caribbean (ECLAC) says the region will see stronger economic growth in
2013, despite ongoing uncertainties at the international level, particularly
the difficulties faced by Europe, the United States and China.
According
to the Preliminary Overview of the Economies of Latin America and the Caribbean
2012 the region will experience economic growth of around 3.8 per cent next
year.
ECLAC’s
executive secretary Alicia Bárcena said the region will end 2012 with Gross
Domestic Product (GDP) growth of 3.1 per cent, “which is higher than the expected
figures for world growth (2.2 per cent), but lower than the 4.3 per cent posted
in 2011.
“This
shows that the world economic crisis had a negative but not dramatic impact on
the continent, as the region maintained a certain resilience to external shocks
throughout the year,” she said.
ECLAC
said that Latin American and Caribbean economies remain largely dependent on
world economic trends in 2013 and that the most likely scenario is that slow
growth, and even recession in some cases, will continue in Europe during 2013,
“although this might also give rise to agreements that could gradually lead to
a resolution of the financial, fiscal and competition imbalances that are
currently in place”.
The
ECLAC document notes that in the United States, the probability of fiscal
agreement increased following the recent presidential elections.
It
states China could post higher growth rates this year or maintain current
levels, depending on the extent to which it manages to boost internal demand
and keep inflationary pressure under control, at the same time as recovering
export growth.
It
is hoped that oil will not become an additional cause of instability for
geopolitical reasons, it added.
The
overview notes that continuously buoyant internal demand in many of the
region's economies will result from improved labour indicators, increased bank
credit to the private sector and rising commodity prices that will not fall
significantly despite high external uncertainty.
But
it warns that Caribbean countries will “remain fiscally fragile, and will
require reforms accompanied by external support to ensure sustainable fiscal
consolidation trajectories”.
According
to Bárcena, the challenge for Latin America and the Caribbean is still to
“increase and stabilize investment growth, and not to depend exclusively on
consumption as a means of driving structural change with equality,
incorporating technical progress and delivering sustainable growth”.
Bárcena
said the main impact of the deterioration on Latin America and the Caribbean is
in the trade sphere, as growth in the region's export values fell sharply from
23.9 per cent in 2011 to an estimated 1.6 per cent in 2012.
According
to ECLAC, Panama will remain the region's fastest growing economy in 2012,
followed by Peru 6.2 per cent, Chile 5.5 per cent and Venezuela 5.3 per cent.
It
says Paraguay, St. Kitts and Nevis and Jamaica will contract by -1.8 per cent,
-0.8 per cent and -0.2 per cent, respectively; while Mexico will grow by 3.8
per cent.
The
overview says Central America as a whole will grow by 4.2 percent, South
America by 2.7 per cent and the Caribbean by 1.1 per cent.
The
study adds that given weakened external demand in the wake of the international
crisis, the region's growth is based on expanding internal demand on the back
of rising wages and credit, which is partly attributable to monetary or fiscal
policy in most countries. (CMC)
SOURCE: http://www.caribbean360.com/index.php/business/644288.html#ixzz2EswUUyYP
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