The International Monetary Fund (IMF) improved growth forecasts for the Latin American and Caribbean economy this year, as expects a 6.3% recovery by 2021 and 2.5% by 2022, according to his latest report World economy perspectives, published this Tuesday.
The figures reflect that the international credit organization observes for 2021 a slight increase in the Gross Domestic Product (GDP) of the region compared to what was evaluated in July, when it estimated a rise of 5.8%. However, it expects a growth of 3.2% for the following year, a figure 0.2% lower than that of its previous analysis.
The IMF anticipates a worse performance of Brazil and Mexico, the strongest economies in the region, in relation to the July assessment, both for this year and next. Brazil’s GDP expansion would be 5.2% in 2021 and 1.5% in 2022, (-0.1 and -0.4 percentage points), and that of Mexico, 6.2% and 4.0 % respectively (-0.1 and -0.2 percentage points).
Meanwhile, the Fund slightly lowered its growth projections for the world economy, stating that it will grow by 5.9% in 2021, when last July it expected a 6% rise in economies, which are still conditioned by the prolongation of the coronavirus pandemic.
Likewise, it maintained the estimates for 2022, considering that the global economy will rise by 4.9% in the next period.
“The global recovery continues, but momentum has weakened, hampered by the pandemic”said the IMF chief economist, Gita Gopinath, when releasing the World Economic Outlook (WEO) report on Tuesday, within the framework of the joint annual Assembly of the Fund and the World Bank.
“Powered by the highly communicable Delta variant, the global recorded death from covid-19 has risen to nearly five million and health risks abound, slowing a full return to normal,” Ginopitah noted on the IMF blog. when explaining the results of the report.
As the economist analyzed, this situation of high uncertainty while the pandemic persists, “puts pressure on prices”, both in developed countries and in the rest.
“Pandemic outbreaks in critical links in global supply chains have led to longer-than-expected supply disruptions, resulting in fuels inflation in many countries“Gopinath added.
In this sense, the IMF projected that, “amid high uncertainty, headline inflation will likely return to pre-pandemic levels in mid-2022 for the group of advanced economies and emerging and developing economies,” the economist said. .
Gopinath argued that “Latin America, like other parts of the world, is being affected by some global ‘shocks’, such as the increase in energy prices, the prices of raw materials, the interruption of the supply chain, and that it’s affecting price levels. “
The vaccine gap
The agency also referred to the “great vaccine gap” and the great disparities between economically advanced countries and those considered developing, a difference that slows down the recovery of this second group.
“While more than 60% of the population in advanced economies are vaccinated and some are now receiving booster injections, about 96% of the population in low-income countries remain unvaccinated,” the report highlights.
For these reasons, the IMF maintains that “the outlook for the group of low-income developing countries have overshadowed considerably due to the worsening dynamics of the pandemic“.
In this context, the IMF chief economist stated in her analysis that the world community “must redouble its efforts to ensure equitable access to vaccines for all countries, overcome doubts about vaccines when there is an adequate supply and ensure better economic prospects for all. ”
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