After growing at an estimated rate of 3.8% in 2022, this year the Latin American and Caribbean countries will experience a sharp slowdown.
Latin America and the Caribbean will grow by only 1.4% in 2023according to calculations presented this Wednesday, January 25, by the United Nations Organization (UN), which warns of a rapid deterioration in the region’s economy and of the difficult decisions faced by the authorities to try to straighten the course .
After growing at an estimated rate of 3.8% in 2022, this year the Latin American and Caribbean countries will experience a sharp slowdown as a result of the complex situation at the global level, inflation that will continue to be very high, added to the low fiscal space and other structural problems.
According to the UN, the largest economies in the region will see very limited growth during 2023affected by both external and internal factors and with significant risks of the situation worsening even more.
In Peru, growth of 2.6% is expected
In Peru steady growth of 2.6% is expected in 2023 and 2024. Exports are forecast to remain a key driver of growth, reflecting expanding copper production. The expansion in consumption will be supported by massive early pension withdrawals and government stimulus measures aimed at helping maintain living standards despite high inflation. Political uncertainty and concerns about the consequences of social unrest (such as mine closures) are likely to weigh on investmentis detailed in the report.
In Brazil, the Gross Domestic Product (GDP) is expected to increase by 0.8% amid strong inflation, higher interest rates and lower export growth. Mexico will grow 0.9% as a result of the economic slowdown in the United States, less access to credit and problems in the supply chain that will limit industrial activity.
In the case of ArgentinaThe United Nations speaks of a “crisis” marked by record levels of inflation and an adjustment in monetary policy that will cause the country to grow by 2%, although with high possibilities that the final figure will be worse.
Inflation, poverty and uncertainty
Although it is expected to start to calm down, inflation will continue to be a serious problem throughout the region in 2023, with a forecast rate of 16.3% for this year, slightly below that of 2022and triggered in the specific case of some countries such as Argentina and Venezuela.
In its report on the outlook for the global economy, the UN stresses that Latin America urgently needs to accelerate its economic growth, which remains at insufficient levels to improve living standards and socioeconomic conditions.
With information from EFE.
Source: Larepublica
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