The Economic Commission for Latin America and the Caribbean (ECLAC) has revised its economic growth projections for the region for 2016, predicting an average contraction of -0.9 percent for bean this year.
But ECLAC said economic activity is expected to pick up in 2017, with average growth of 1.5 percent.
ECLAC said the projections for 2017 reflect expectations of more auspicious global conditions than in 2015 and 2016.
It said prices for commodities in 2017 will show gains over average-2016 levels, with growth expecting to be stronger in the economies of the region’s trading partners.
As in 2016, ECLAC said growth in 2017 will show “marked differences” between countries and sub-regions.
ECLAC said the economies of South America, which specialize in primary goods — particularly oil, minerals and foods — will post average growth of 1.1 percent in 2017, contrasting with a contraction estimated at –2.2 percent in 2016.
The economies of Central America are expected to register growth of 4.0 percent in 2017, above the 3.7 percent projected for 2016.
For Central America plus Mexico, the projections are 2.5 percent for 2016 and 2.6 percent for 2017, ECLAC said.
In the English- and Dutch-speaking Caribbean, ECLAC said average growth is estimated at 1.4 percent for 2017, contrasting positively with the contraction of -0.3 percent expected for 2016.
According to ECLAC, stronger investment and better productivity are needed in order to maintain a sustained growth path and support the higher growth rates projected for 2017.
“Here, investment in infrastructure and technological innovation must play a key role,” ECLAC said.
At the same time, in order to safeguard the progress made in recent years on the social front, ECLAC calls for policies to maintain social and production investment in “a framework of smart fiscal adjustments.
“Efforts are needed to ensure the sustainability of the region’s public finances, with policies that consider both the impact on long-term growth capacity and the social conditions of the region’s population,” ECLAC said.
In view of the current economic downturn, ECLAC again affirms that the region needs a “progressive structural change with an environmental big push to drive development based on equality and environmental sustainability.
“Public and private investment policies need to be coordinated across different areas to reshape patterns of production, consumption and energy, based on learning and innovation,” ECLAC said. “This will help move the region towards fulfilment of the 2030 Agenda for Sustainable Development and the Sustainable Development Goals.”