Latin America’s GDP is projected to grow by 5.2% in 2021 and 2.9% in 2022, according to the latest (October 2021) Economic Survey of ECLAC ( UN Economic Commission for Latin America and the Caribbean)
The growth is coming back after a GDP contraction of 6.8% in 2020. The region is recovering slowly after having suffered disproportionate deaths and devastation caused by covid.
GDP growth:
country | 2021 | 2022 |
Brazil | 5.2 | 2.2 |
Mexico | 6.2 | 3.2 |
Argentina | 7.5 | 2.7 |
Colombia | 7.5 | 3.8 |
Peru | 10.6 | 4.4 |
Chile | 9.2 | 3.2 |
Venezuela | -4.0 | 1 |
Central America | 5.5 | 4.6 |
Venezuela is expected to show a positive GDP growth of 1% in 2022.
What a pleasant surprise !
What a relief !.. after seven consecutive years of GDP contraction.
Venezuela has suffered an astonishing -124.4% GDP contraction cumulatively since 2014. The economy shrank by a brutal -30% in 2020, -28% in 2019, -19.6% in 2018, -15.7% in 2017 and -17% in 2016.
The rise in international price and demand for commodities exported by Latin American countries will help in the recovery and growth.
Average Inflation of the region was 5.4% in June 2021 on a year-on-year basis. The region has managed to keep the rate of inflation in single digits in recent years. The exceptions are Venezuela and Argentina.
Venezuela’s inflation stood at 2719% in June 2021. It has come down from a sky-high 132,060 % in 2019. Argentina’s inflation continues to be in double digits of over 25% in the last several years.
Venezuela’s economic catastrophe is compounded by its political crisis and the crippling US sanctions. Argentina is again staring at large external debt and inadequate reserves to meet the payments.
Brazil, which has suffered excessive covid deaths due to the irresponsible policies of the extreme rightist Bolsonaro, is in for political crisis in 2022 when Bolsonaro is likely to challenge his expected defeat in the next year’s elections.
Except for Argentina and Venezuela, the other 17 countries of Latin America show relatively positive and encouraging macroeconomic fundamentals.
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