neutral and greater numbers signifying positive sentiment.
Moderate recovery in Latin American and Caribbean economies The economies of Latin America and the Caribbean are seen experiencing a moderate recovery in 2018 and growing 2.2%, after notching 1.3% growth on average in 2017, ECLAC indicated in its report Preliminary Overview of the Economies of Latin America and the Caribbean 2017. These projections for economic activity in the region come about in a more favourable international context than in the last few years. According to the report, in 2018 it is expected that the global economy will expand at a rate close to that of 2017 (around 3%) and that emerging economies will show greater dynamism than developed ones. In the monetary sphere, the current situation of ample liquidity and low international interest rates is seen holding steady. In addition, domestic demand will play an important role in the acceleration
of growth in 2018, although with variations among its components. Private consumption continues to be the motor of domestic demand, but in 2018, investment will make a greater contribution thanks to a recovery in gross fixed capital formation, ECLAC indicated. “Although there is reduced fiscal space in the region, we need to promote active public policies to sustain the expansion cycle. These include strengthening regulation, productive development, tax collection and intraregional trade,” ECLAC’s most senior authority stated. “Spending that has a greater impact on growth and inequality must be prioritised, along with avoiding sharp adjustments in public investment to protect growth in the medium term.” Despite the more favourable international context, ECLAC noted that some challenges and latent risks persist that could affect the consolidation of growth in the medium term. In the financial arena, there is uncertainty regarding normalisation of the monetary conditions that have been
implemented or announced by the US Federal Reserve, the European Central Bank and the Bank of Japan. This is compounded by the trend towards greater financial deregulation (laws to reform Wall Street and consumer protection in the United States). A possible tax reform in the United States could bring with it greater financial volatility due to an increase in capital flows to that country. There are also geopolitical risks, especially those stemming from the increased protectionism seen in some countries and reflected in growing support for antiglobalisation parties in some European nations, as well as the vote in favour of Brexit in the United Kingdom. The 2018 regional growth figure can be partly explained by greater dynamism in Brazil’s economic growth (2%, compared with 0.9% in 2017). In addition, several countries that were growing at moderate rates will see their economic activity accelerate. For example, Chile will rise from a rate of 1.5% in 2017 to 2.8%; Colombia, from 1.8% to 2.6%; and Peru, from 2.5% to 3.5%.
THE AMERICAS Global Awards 2018
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