World Bank Forecasts an Average Growth of 1.2% for Latin America in 2014

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    The Costa Rica News (TCRN) – By teleconference this week, World Bank officials predicted an average growth of 1.2% for Latin America, with a rise to 2.2 % in 2015, as stated in the semiannual report, Inequality in Latin America With Lower Growth.

    Augusto de la Torre, World Bank chief economist for Latin America and the Caribbean, said that this is a low figure compared to the last decade when the region grew an average of 4%.

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    However, this slowdown is different, predicts the economist, in terms that the equity in Latin America today is not the same as the 80s or 90s, which is good news.

    “For the first time in recent history, the region is no longer a cycle of booms and busts that used to generate an economic decline for many years, especially hurting the poor,” he said

    The report, published ahead of the annual meetings of the World Bank Group and IMF, discovered great heterogeneity within the region.

    Panama leads with an impressive growth of 6.6% this year and it’s expected that Bolivia, Colombia, Ecuador, Guyana, Nicaragua, Paraguay, Dominican Republic and Suriname will grow more than 4%, well above the regional average .

    Meanwhile large economies such as Venezuela and Argentina are into negative territory, with -2.9% and -1.5% respectively, and the regional giant, Brazil is expected to grow only 0.5%.

    To maintain the pro-growth path over the last decade, reforms to productivity should be complemented by policies that increase the quality and coverage of education in line with the growing demand for skilled labor.

    The economist noted that some countries in the region have at their disposal tools such as counter-cyclical monetary policies with flexible exchange rates, as well as ample room to borrow, which will help keep jobs without compromising the long term increase of productivity needed to grow. (Crhoy)

    The Costa Rica News (TCRN)

    San Jose, Costa Rica

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