By Isaac Cohen*
Once again, the Latin American and Caribbean economies are going through another phase of contraction in the commodity export cycle, characterized by low export prices, capital flight, depreciating currencies and meager growth.
Therefore, the International Monetary Fund presented another downward revision to the regional growth projections for 2015, at -0.3 percent, followed by a modest recovery of 0.8 percent for 2016. However, as recognized by the head of the Fund’s Western Hemisphere Department Alejandro Werner, “the outlook is not so gloomy all around.” Some of the major economies are pushing down the regional growth average. For instance, the Brazilian economy is projected to contract -3.0 percent in 2015 and -1 percent in 2016, while the projection for the Venezuelan economy is of a profound contraction of -10 percent in 2015 and -6 percent in 2016.
Even stellar economic performers such as Chile, Colombia and Peru are projected to grow at around 2 percent in both 2015 and 2016, while yearly growth for the Mexican economy, despite its close relation to the United States, is projected this year and next at around 2.5 percent. One exception to this depressive trend is found in the Central American economies, including Panama and the Dominican Republic, in all of them annual growth in 2015 and 2016 is expected at around 4 percent.
*International analyst and consultant. Commentator on economic and financial issues for CNN en Español TV and radio. Former Director, UNECLAC.