Report on Latin American economic situation

The economic survey of 28 August 2008 issued by the Economic Commission for Latin America and Caribbean ( ECLAC) is positive and optimistic about the prospects of the region. Highlights as follows

- the growth of the region in 2008 is estimated to be 4.7 %, making this year as the sixth consecutive year of growth, a record in the last forty years. Although the growth has come down from 5.7 % in 2007 and is expected to decline to 4% in 2009, the growth figures are good considering the current global scenario of slower world growth and increased volatility and incertainty in the financial markets.
- Brazil´s growth in 2008 is projected as 4.8% in 2008 and 4% in 2009; Mexico´s growth 2.5 % in 2008 and in 2009; Argentina´s 7% in 2008 and 5% in 2009; Colombia´s 5.3% in 2008 and 4.5% in 2009. Peru will have the highest growth in the region with 8.3% in 2008 and 7% in 2009.
- For the fifth consecutive year, the region showed current account surplus which stood at 0.5% of GDP in 2007.
- One of the outstanding points of the region´s macroeconomic performance in 2007 was strong growth in investment, which stood at 21.1% of the GDP.
- External debt dropped to 19.9% of GDP in 2007 from 21.8% in 2006. The total external debt of the region was 720 billion dollars in December 207. The governments have paid off their debt and restructured and improved the terms of their debt with better rates and currency composition.
- Average inflation increased to 8.4% in 2008 from 6.4% in 2007.
- The region has developed greater capacity to withstand external shocks due to its strong macroeconomic fundamentals, fiscal solvency and external surplus.
- Foreign exchange reserves increased by 43% to 460 billion dollars in December 2007.
- Foreign Direct Investment increased by 46% in 2007 reaching a record 106 billion dollars.
- Unemployment has been steadily decreasing since 2003 reaching 8% in 2007 and is expected to go down to 7.5% in 2008.