SANTIAGO, Chile, Thursday April 9, 2015, CMC – The Economic Commission for Latin America and the Caribbean (ECLAC) has revised slightly downward its 2015 economic growth projection for the region, forecasting now a one per cent increase in the Gross Domestic Product (GDP).
ECLAC said that the revision “reflects a global environment characterized by less economic dynamism than what was expected at the end of 2014”.
With the exception of the United States, ECLAC noted that industrialized countries have revised their growth estimates downward, adding that emerging economies continue to decelerate.
According to ECLAC’s annual report “Preliminary Overview of the Economies of Latin America and the Caribbean 2015,” the region is expected to keep economic growth at 1.1 per cent, the same level as in 2014.
In the sub-regions, ECLAC forecasts growth of nearly zero per cent for South America, while Central America and Mexico should reach 3.2 per cent and the Caribbean 1.9 per cent.
In addition to lower growth in the global economy, there is also an impact from greater international financial volatility due to very expansive monetary policies in Europe and Japan, combined with expectations that the United States will raise interest rates, ECLAC said.
It said the end of the so-called “super cycle” in commodity prices is affecting several countries in the region negatively.
“The particularities of the region’s economies, in terms of their economic structures and their modes of insertion in the global economy, account for the significant heterogeneity in the magnitude and way in which external shocks have affected them,” ECLAC said.
It said the growth forecasts for economies specialized in commodities production, particularly oil and minerals have seen the biggest declines, pointing to South America and Trinidad and Tobago.
At the same time, ECLAC said those with greater links to the US economy, and which benefit from lower crude prices, have the best forecasts: Central America and the English-speaking Caribbean.
ECLAC said the countries that will lead the region’s expansion during 2015 are Panama with a six per cent increase in its GDP, Antigua and Barbuda 5.4 per cent, and Bolivia, Nicaragua and the Dominican Republic at five per cent.