CEPAL Says Latin American and Caribbean Economy Will Grow in 2004

The Latin American and Caribbean overall economy will take a 3.3 percent jump this year according to estimates reckoned by the Economic Commission for Latin America and the Caribbean (CEPAL is the acronym in Spanish).

The economic going of Latin American nations, though, will hinge heavily on the good health of the U.S. economy.

Around 60 percent of Latin America’s exports are headed for the U.S. market and that nation provides half the number of tourists that visit the region in a single year.

In that sense, CEPAL officials believe there are great expectations placed on a potential Free Trade Agreement between Central America and the United States.

The CEPAL report notes the Costa Rican economy will fare better than the rest, even though growth will slide from 5.6 percent last year to 4.4 percent by the end of 2004.

Panama will soar 4 percent, while the Nicaraguan, Honduran, Guatemalan and Salvadoran economies will accrue 3.7, 3.5, 2.6 and 2.2 percent, respectively.

The regional economy has been bouncing back since 2003 after going through two years of scarce or no growth at all.

The CEPAL study points to significant increments in the prices of most farming commodities. However, higher oil prices will affect exchange terms in the region. Therefore, organizations like the United Nations believe chances for bigger income money are pretty slim.

CEPAL also points out that Chile continues to be one of the steadiest economies in the region with an estimated 4.7 percent growth for the ongoing year.

Regardless of some upbeat notes contained in the report, CEPAL experts warn the economic improvement is basically owed to a rebounding world economy.

“What we see in the region is basically a reflection of a growing world economy, not that things are changing overnight in the region,” the report continues. “We are depending heavily on the good pace of the world economy and the recovery of the American financial system.”