Economic Survey for Latin America and the Caribbean 2008-2009

Source: Economic Commission for Latin America and the Caribbean (UN)

The publication of the sixty-first edition of the Economic Survey of Latin America and the Caribbean, corresponding to 2008-2009, comes at a critical point in the economic development of the Latin American and Caribbean region. A growth phase that the region’s recent history cannot equal in nature and duration has come to an end and output is contracting. The toll this state of affairs is taking on the well-being of the population will inevitably be reflected in setbacks in social variables. Two traits set the current situation apart from the many crises that have beset the region in decades past. First, this crisis did not originate in the region or even in another emerging economy, but in the world’s largest economy, whence the effects spread worldwide, albeit with significant differences among countries and regions. Second, since the countries have (albeit with major exceptions) reduced their debt and built up their reserves during the boom years, the region overall is better prepared than in the past, and than other regions this time around, to tackle the crisis. These traits, in turn, have two implications. First, the rate of contraction forecast for 2009 is relatively moderate although, again, with sharp differences among the countries of the region. Second, the recovery depends to a great extent on an upturn in the global economy overall.

The first part of this edition of the Economic Survey looks at the channels through which the crisis is affecting the economies of the region and its impact on variables such as economic growth, employment and external-sector indicators. It also discusses the strengths and weaknesses of the countries in dealing with the fallout from the global crisis and the economic policies they have deployed to this end. The analysis covers the performance of the region’s economy in 2008 and the first semester of 2009 and concludes with a discussion of the outlook for the second half of the year. This chapter draws on an extensive statistical appendix.

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