The International Monetary Fund (IMF) expects the Latin American economy to grow by 1.9% in 2023, which represents an improvement of three tenths compared to the latest projections of the organization published last April.

This upward revision of growth prospects for the region is due to stronger than expected growth in some large countries such as Brazil or Mexico, whose economies have been driven by the agricultural sector or the service sector.

However, this increase in the Gross Domestic Product (GDP) of Latin America is much lower than that registered by the region in 2022, when it was 3.9 %. The year-on-year decline is due to the recent moderation of rapid growth in 2022 due to the reopening after the pandemic, as well as declining commodity prices.

Meanwhile, looking to 2024, the IMF estimates that the Latin American economy will grow by 2.2 %, the same figure that it calculated last April. It was on that occasion that the forecast for 2024 improved by two tenths.

Latin America will thus be one of the regions that grows the least in both 2023 and 2024 within the group of emerging market and developing economies. However, globally, it will have a better economic performance than the Eurozone, whose GDP will increase by 0.9 % in 2023, or higher than that of the United States, which will grow by 1.8 %.

By country, it is worth noting the improvement in the forecasts for Brazil, whose estimated growth in 2023 is 2.1 %, well above the 0.9 % estimated last April. Among others, this increase in the figure is due to the good performance of its GDP in the first quarter of the year.

Meanwhile, Mexico will also exceed the 2 % figure and reach up to 2.6 % expansion at the end of this year, although it will grow less than expected in 2024, staying at 1.5 % (one tenth less than in April). The resilient demand from the United States and the ‘nearshoring’ effect are boosting the Mexican economy.

Source: dpa

(Reference image source: BID, Europa Press / dpa)

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