ECLAC lowers projections and Latin America will have another weak year.
According to the Economic Commission for Latin America and the Caribbean (ECLAC), Latin America is expected to grow 1,3% this year, less than the 1,7% forecast in December; Brazil and Mexico, the region's two largest economies, had their estimates revised downwards, falling from 2% to 1,8% and from 2,1% to 1,7%, respectively.
247 - The Economic Commission for Latin America and the Caribbean (ECLAC) on Thursday (11) lowered its growth estimates for the region due to external factors, such as a slowdown in global trade, and internal factors, such as lower consumption and investment. According to ECLAC, Latin America is expected to grow 1,3% this year, less than the 1,7% forecast in December. Brazil and Mexico, the two largest economies in the region, had their estimates revised downwards, falling from 2% to 1,8%, and from 2,1% to 1,7%, respectively. The reports were published in newspaper Valor Econômico.
Daniel Titelman, director of the Economic Development Division at ECLAC (Economic Commission for Latin America and the Caribbean), states that the projections were reduced due to the deterioration of external conditions. "There is a change in cycle. If until 2017 we were talking about synchronized acceleration, now we are talking about synchronized deceleration," he says. "This lower growth is accompanied by less dynamic world trade. The World Trade Organization (WTO) cut its trade growth projection from 3,7% to 2,6% this year. This context affects the region's growth."
Alberto Ramos, chief economist for Latin America at Goldman Sachs, expects 2019 to be as "mediocre" as last year's performance. "Unfortunately, it will be more of the same: very low growth for the region's potential. The major economies are in a very weak position, particularly Brazil, which is not gaining momentum even after the end of the recession," he says.