Present Gains and Past Glories

The Economic Commission for Latin America and the Caribbean predicts that the region’s per capita Gross Domestic Product will repeat last year’s result and grow by 4 per cent in 2005. ECLAC reports that the region’s economy grew by 5.5 per cent in 2004, a figure which has surprised everyone and is the region’s best result since 1980.

The current regional recovery has been largely due to GDP growth accompanied by a surplus in the balance of payments current account; at the same time there has been a rise in output, despite large capital outflows (almost $20 billion net). In 2004, regional inflation stood at 7.3 per cent with combined exports of over $460 billion and imports of almost $399 billion. There seems to be less dependency on international capital markets and sovereign risk premiums have been lowered. The level of external debt last year fell from 42.8 per cent of GDP in 2003 to 37.2 per cent. The demand, particularly in Latin America, for labour has seen a marked increase in