World Economic Outlook: IMF revises GDP predictions for LATAM and the Carribbean

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Written on Apr 16, 2024

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Brazil’s growth anticipation for 2024 is 2.2%, which is 0.5% more than the January estimate.
Mexico’s growth anticipation is 2.4%, which is 0.3% less than the estimations made in January.
In Argentina, the IMF predicts the GDP growth reductions to further deteriorate to -2.8% in 2024.

In today’s World Economic Outlook, the International Monetary Fund (IMF) revised its 2024 economic growth predictions for Latin America and the Caribbean to 2% from its previous estimate of 1.9%. Regardless of this upgrade, the IMF expects a slowdown of these countries’ economies.

Overall GDP slowdown

The 2% increase in GDP growth anticipation for 2024 is in contrast with the 2.3% increase growth in 2023, and a forecast of 2.5% for 2025. This slowing of growth is because of smaller growth rates in Latin America’s most growing economies.

Region-specific GDP anticipation

Brazil’s growth anticipation for 2024 is 2.2%, which is 0.5% more than the January estimate.

Mexico’s growth anticipation is 2.4%, which is 0.3% less than the estimations made in January. In 2023 however, the growths were at 2.9% and 3.2% for Brazil and Mexico respectively.

The IMF states Brazil’s GDP growth is expected to slowdown to 2.2% in 2024 because of fiscal consolidation, the lingering effects of a tight monetary policy and less contribution from the agricultural sector.

The IMF also stated that a decline in manufacturing would result in a slower economic growth for Mexico; however, increased government spending will play a pivotal role in substantiating this year’s estimated growth.

In Argentina, the IMF predicts the GDP growth reductions to further deteriorate to -2.8% in 2024 as compared to the previous year’s -1.6%.

Chile, Peru, and Colombia’s GDP growth rates are higher than the previous year’s. Chile’s economy is expected to grow by 2% from 0.2% in 2023. Peru is expecting a growth of 2.5% after experiencing a 0.6% deceleration in 2023. This year, Colombia’s GDP grew by 1.1%, whereas in 2023 it grew by 0.6%.

Central America’s economy is expected to grow by 3.9% as compared to 4.2% in 2023, and the Caribbean can anticipate a growth of 9.7% this year as compared to 8.3% in 2023.

The World Bank last week revised its growth projections for Latin America and the Caribbean down to 1.6% for this year.