News Column

Latin American Outlook Masks Vigorous Performances

May 3, 2013

Isaac Cohen -- HispanicBusiness.com

south american economic outlook

International organizations such as the Economic Commission for Latin America and the Caribbean, the International Monetary Fund and the World Bank agree that economic growth in Latin America in 2013 will reach 3.5 percent, slightly more than 3 percent in 2012.

The main reason is the persistence of less favorable external circumstances, such as the slowdown in China, lower commodity prices and the European recession, coupled to the slow recovery in the U.S.

Last year, these adverse factors contributed to the drastic fall in the performance of South America's largest economies, with Brazil growing less than 1 percent, while Argentina's growth reached only 2 percent. Both weak performances pushed down the regional average rate of growth in 2012 to 3 percent.

This year's projections are slightly better, because they are based on the expectation that economic growth in Argentina and Brazil will reach at least 3 percent.

The regional average also masks some vigorous performances, which are expected to persist in 2013, despite the adverse impact of international circumstances.

Panama's growth at 8 percent will remain the best performer, followed by Peru with 6 percent, while Bolivia, Chile, Costa Rica and Nicaragua are expected to repeat rates of growth of more than 5 percent.

Growth in the economies of Central America and Mexico in 2013 is projected to remain around the regional average of 3 percent.

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Isaac Cohen is an international analyst and consultant, a commentator on economic and financial issues for CNN en Espaņol TV and radio, and a former director, UNECLAC Washington Office.

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