ECONOMY: Latin America's 1994 Growth Rate Highest since 1986
SANTIAGO, Dic 20 (IPS) - Latin America's 1994 economic growth rate will reach 3.7 percent, only surpassed since 14 years ago by the 1986 rate, the Latin American and Caribbean Economic Commission (CEPAL) reported on Tuesday.
CEPAL Executive Secretary Gert Rosenthal also reported widespread success in curbing inflation, as well as a general increase in unemployment rates.
"Growth rates lower than four percent are not enough to make significant progress possible in the battle against poverty in Latin America and the Caribbean, nor to keep unemployment and under-employment rates from reaching unacceptable levels," Rosenthal added.
Peru led the region with an 11 percent increase in its Gross Domestic Product (GDP), while only three countries saw a decline in their GDP: Haiti, with a 10 percent drop, Venezuela (4.0 percent), and Honduras (1.5 percent).
The 3.7 percent growth rate in the region's GDP is the highest since 1980, with the exception of a 3.9 percent rate registered in 1986 following the hard-hitting recession of the early 1980s brought on by the foreign debt crisis.
The report attributes the economic growth to a rise in external demand and a sustained increase of both domestic and foreign investment.
Peru was followed by Guyana with an 8.0 percent rate of GDP growth, and Argentina (6.0 percent), Colombia, Panama and El Salvador (5.0), and Brazil, Chile, Uruguay and Costa Rica with a 4.5 percent growth rate.
The lowest growth rates were seen in Nicaragua and Saint Kitts Nevis (2.5 percent) and in Jamaica (1.0 percent).
The average inflation rate in Latin America and the Caribbean dropped from 887.6 percent in 1993 to 465.4 percent this year. However, if Brazil is excluded, the average increase in consumer prices will amount to only 16 percent in 1994, compared to 19 percent in 1993.
Rosenthal pointed out that Brazil began to curb its runaway inflation in the second half of this year thanks to its current economic stabilisation plan, and added that in the future the country will no longer be an exception to the general price pattern.
Also significant is that for the first time the price indexes of eight countries in the region will drop below 10 percent: in Argentina, Barbados, Bolivia, Chile, El Salvador, Mexico, Panama and Trinidad and Tobago.
Contrasting with the region's generalised success at curbing inflation was a rise in the unemployment rates of all countries except Peru, blamed on the growth of the economically active population.
The CEPAL official also stressed that in 1994 the inflow of foreign capital to the region remained high, reaching 57 billion dollars, slightly less than 1993's 65 billion.
Foreign productive and financial investment helped offset a 22.8 billion dollar trade deficit in the region's balance of payments, the result of 171 billion dollars worth of imports compared to 153 billion dollars in exports.
Meanwhile, the region's foreign debt grew only six percent in 1994, reaching 534 billion dollars.
Rosenthal predicted that Latin America's GDP will continue to grow in coming years, and that poverty rates, which remain higher than those experienced in the 1980s, will begin to drop.
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