Latin America's economy exceeds expectations and stabilizes after the pandemic

EFE.- ECONOMY OF COUNTRIES Latin America It grew more than expected 2023 This allowed the destruction left behind to be overcome International distribution from COVID-19This was revealed in a report released by the Inter-American Development Bank (IDB) on Monday.

The region saw an economic growth of 2.1% year-on-year the frontA number is doubled Predictions That the bank did it.

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“After two years VolatileWe've landed gently and now we're ready take offEric Barado, IDB's chief economist, explained in an interview EFE.

The report elaborated on the fiscal policies adopted by countries in the region to deal with its consequences International distributionAlong with general growth in the global economy, it provided the necessary impetus to the recovery being experienced.

Also, the IDB highlights the “timely” reaction Banks centers of the facing region inflammationThis also paved the way for last year's data to exceed expectations, according to him.

“The region's central banks acted on time long ago Countries was created and with rates curiosity Much more High“Latin America's banking systems were part of the solution, not part of the problem as they were in the past,” Parrado added, in response to the effects the pandemic left on the economies.

The interest rate hike has eased average annual inflation to 3.8% in December last year, and the primary fiscal deficit has been balanced by spending cuts created by Covid-19, the report said.

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The regional growth recorded last year was driven by the expansion of economies in countries such as Mexico and rising commodity prices. Lessons PrincipalThe growth rate is around 3%.

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Impact of “El Niño” in Latin America

The report also highlights the impact of the weather phenomenon “”.NINor” in some countries in the region, particularly those in the Southern Cone such as Argentina and Uruguay.

According to the World Meteorological Organization (WMO), this weather event will last until April this year droughts In the southern countries of the continent, it affected production Lessons Principal.

Therefore, the report estimates that “El Nino” could cause a 3% increase debt The bank recommends that governments allocate public resources to “adaptation and mitigation” of climate change to mitigate these adverse effects on the economy, as a percentage of the region's gross domestic product (GDP) over three years.

Recession and uncertainty in 2024

IDB estimates for this year envisage economic growth in the region decelerating to 1.6% and then to 2% in 2025, however, this highlights that factors are at play. Uncertainty That includes measures taken by the US Federal Reserve against inflation, which could affect forecasts.

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The IDB Chief Economist indicated that multilateralism believes Washington Go down rates of curiosity It has been doing so, but recommended that countries in the region not make decisions about their own rates until they know what the United States will do.

The report also warned that the escalation of conflict in the Middle East is “likely to increase”. Volatility Prices of raw materials”, creating uncertainty in the regional economy.

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The IDB Macroeconomic Report was presented after the conclusion of the organization's annual meeting in Punta Cana (Dominican Republic), where the bank approved a series of institutional reforms aimed at attracting more private capital to the bank..

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