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IMF Anticipates Lowest Growth Rates in Latin America Since 2009

By: PanAm Post Staff - Oct 8, 2014, 4:03 pm

EspañolThe International Monetary Fund (IMF) estimates Latin-American economies will continue to grow in 2014, but at a lower rate than the previous year.

According to the Global Economic Perspectives report, which the IMF publishes every 3 months, Latin-American countries will grow at an average rate of 1.3 percent. This figure not only represents a 0.7 percent drop from July’s projections, it is also the lowest projected growth rate since 2009.

The IMF also predicts an average growth rate of 2.2 percent for 2015, a 0.4 percent drop since the previous forecast.

Individual Latin-American economies will experience mixed results in 2014. While Panama (6.6 percent) and Bolivia (5.2 percent) sit atop the list of countries with the highest projected growth rates, the IMF says Venezuela and Argentina will experience negative growth rates of 1.7 and 3 percent, respectively.

The report projects a meager 0.3 percent growth rate for Brazil in 2014, although it is expected to jump to 1.4 percent in 2015. Brazil’s economic stagnation is attributed to a “lack of competition,” along with the “weakness of private sector investment,” and “moderation of consumption.”

The IMF reduced the expected economic growth rate in Argentina due to “deepening macroeconomic imbalances and economic polices that have produced high inflation, negative growth rates, and a widening of the gap between the parallel exchange rate and official exchange rate.”

The report attributes Venezuela’s economic troubles to “profound distortions in policies that have generated widespread scarcity, a collapse in growth, and a current inflation rate that is higher than 60 percent.”

Negative corrections made to projections for Chile (2 percent) and Peru (3.6 percent) are said to be a result of “contraction of internal demand.”

Source: Infolatam.