Improvements in economic prospects for Caribbean/Latin America – IMF

WASH­ING­TON – The In­ter­na­tion­al Mon­e­tary Fund (IMF), says eco­nom­ic prospects for the re­gion are gen­er­al­ly im­prov­ing and mod­est growth is ex­pect­ed in 2018 and 2019.

The IMF, in its Re­gion­al Eco­nom­ic Out­look Up­date for Latin Amer­i­ca and the Caribbean, re­leased on Thurs­day, said the pos­i­tive out­look is sup­port­ed by growth in the Unit­ed States fol­low­ing the re­cent U.S. tax re­form.

How­ev­er, the in­ter­na­tion­al lend­ing agency not­ed that some of the is­lands that were hit hard dur­ing the 2017 hur­ri­cane sea­son face a pro­tract­ed re­cov­ery.

One such coun­try is Do­mini­ca.

“In Do­mini­ca, gross do­mes­tic prod­uct (GDP) is pro­ject­ed to de­cline by 16 per­cent in 2018, be­fore re­bound­ing in 2019 as re­con­struc­tion gath­ers pace.”

The IMF al­so not­ed that over­all, re­cent trends in the world econ­o­my and fi­nan­cial mar­kets are good news for the Caribbean and Latin Amer­i­ca.

“Glob­al growth and trade are on an up­swing, and we ex­pect the mo­men­tum to con­tin­ue in 2018. Stronger com­mod­i­ty prices have al­so helped the re­gion re­bound.”

The re­port said con­sump­tion and ex­ports were the main growth dri­vers last year and the re­cov­ery is broad based across the re­gion.

“En­cour­ag­ing­ly, in­vest­ment is no longer a drag, and is ex­pect­ed to be an im­por­tant fac­tor be­hind the ac­cel­er­a­tion in out­put this year and next. In­fla­tion came down sig­nif­i­cant­ly in 2017 in many coun­tries, pro­vid­ing some scope for eas­ing mon­e­tary pol­i­cy.”

The Wash­ing­ton based lend­ing agency said that while Mex­i­co, Cen­tral Amer­i­ca, and parts of the Caribbean are ben­e­fit­ting from stronger growth in the Unit­ed States, growth in South Amer­i­ca is main­ly dri­ven by the end of re­ces­sions in Brazil, Ar­genti­na, and Ecuador, as well as high­er com­mod­i­ty prices.

It said that in the Unit­ed States, re­forms to U.S. cor­po­rate and per­son­al in­come tax­es passed in De­cem­ber 2017 will like­ly raise pri­vate in­vest­ment and pri­vate con­sump­tion over the short term. (CMC)

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Publish date : 2024-07-30 11:42:00

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