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Latin America Macroeconomic Outlook: A Global Perspective
Report

Latin America Macroeconomic Outlook: A Global Perspective

Macroeconomic Vulnerabilities in an Uncertain World: One Region, Three Latin Americas

Ernesto Talvi
Brookings Institution, 2014
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Editorial Rating

7

Qualities

  • Analytical
  • Overview

Recommendation

From 2004 to 2011, Latin America experienced uniformly robust growth, save for one year during the Great Recession. The more recent past, however, has been less auspicious, with the region’s economic performance diverging into three tiers. Economist Ernesto Talvi highlights the “one region, three Latin Americas” phenomenon in this concise, user-friendly overview of the continent’s prospects. Though the report sometimes skimps on detail and can be repetitive, it succinctly lays out what Latin American countries must do to ensure their economic futures. getAbstract recommends this astute analysis to executives and investors with interests in the region.

Summary

From a macroeconomic perspective, the LAC-7 – that is, the seven countries that account for 93% of Latin America’s GDP – operates at three speeds. Chile, Colombia, Peru and Mexico are running the fastest, with strong liquidity, low inflation, prudent fiscal management and unfettered access to global capital markets. Estimates suggest that these four nations will register growth higher than the predicted 3.3% average LAC-7 rate for 2014 to 2018. Brazil, which can tap international financial markets but suffers from fiscal mismanagement, is in the middle of the pack, and...

About the Author

Ernesto Talvi is a nonresident senior fellow and the director of the Brookings Global-CERES Economic and Social Policy in Latin America Initiative.

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