UN agency says Latin American countries to see average economic growth of 2.7 percent

UN agency says Latin American countries to see average economic growth of 2.7 percent
# 30 April 2014 03:18 (UTC +04:00)

Baku-APA. Latin American and Caribbean countries will see an average economic growth of 2.7 percent this year, due to the "limited dynamism of the region's principal economies," a United Nations agency said Tuesday, APA reports quoting XInhua.

The Economic Commission for Latin America and the Caribbean ( ECLAC), the United Nations regional commission based in Santiago, Chile, said the growth rate may vary from country to country, but the major economies of the region showed lackluster growth.

The forecast, released as part of the agency's report "Updated Economic Overview of Latin America and the Caribbean 2013," showed regional growth will be slightly higher than in 2013 (2.5 percent), but lower than the rate forecast in December (3.2 percent), due to global factors and lower than expected growth for the region's larger economies, Brazil (2.3 percent) and Mexico (3 percent).

The economic growth forecast for Argentina was reduced to 1 percent, due to measures it took in early 2014 to counter the imbalances of recent years, causing its economy to contract, as was Venezuela's economy, which is expected to contract minus 0.5 percent, as a result of its "complex economic situation," according to the report.

Countries expected to do better include Panama, Bolivia, Peru, Ecuador, Nicaragua and the Dominican Republic, which are projected to see "growth figures equal or higher than 5 percent."

The agency warned of several external factors, primarily that China, one of the region's main trade partners, has "set a minimum growth goal of 7 percent for this year." It also warned that demand for commodities is expected to remain limited, "especially mining and food products, which, combined with currency appreciation in developed countries, would cause commodity prices to drop modestly. The decrease would affect the economies that export these products, like those of South America."

The report said that the United States' recovery would have a positive impact on the economies of its closest neighbors, especially Mexico and Central America.

Caribbean countries as a whole are expected to see a growth of 2.1 percent.

Regional inflation is expected to rise somewhat, as evident from the first two months of the year, said the ECLAC in the report.

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