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The region most affected by the pandemic maintains inflationary pressure, also caused by blockages in the supply chain, political instability and even climate change.
A region without rest. The post-pandemic economic recovery has been slowed down in recent months by global inflationary pressures that are impacting the largest economies in Latin America.
The report ‘Preliminary Balance of the Economies of Latin America and the Caribbean’ of the Economic Commission for Latin America and the Caribbean (ECLAC), reported a general inflation of 7.2% for the region in 2021, not including countries with inflation chronic as Argentina, Haiti, Suriname and Venezuela.
According to ECLAC, the economy of Latin America, considered the region most affected by the pandemic, grew by 6.2% in 2021 and 2022 is expected to be marked by asymmetries between countries and a slowdown caused by uncertainty.
“The pandemic has inflicted lasting damage on the growth of the economies in much of the region, which is aggravated by the structural problems that our region has had since before the crisis, these problems of low investment, low productivity and informality. ”, affirmed Alicia Bárcena, executive secretary of ECLAC.
Brazil, Mexico, Chile and Colombia, the largest economies in Latin America, performed above the ceiling of the central banks’ target range, while in Argentina and Venezuela the structural factors prior to the crisis persisted.
For the Colombian Daniel Velandia, chief economist of the financial holding company Credicorp Capital, he assured that “over the past year there were a series of factors that ended up putting pressure, such as the breakdown of supply chains in logistics due to the shortage of supplies and maritime transport, the world container crisis added to the measures of the governments since each country in the region faced climatic and political factors that led to a depreciation of the exchange rate, strikes and social protests”.
In Brazil, the Consumer Price Index, CPI, was 10.06% in 2021, higher than the Central Bank’s goal of 3.75% and surpassed that of the previous year, which was 4.52%. The strongest drought in 100 years occurred there, which increased the price of fuel by 49.02% and electricity by 21.21%.
For its part, Mexico registered an inflation of 7.36%, after a significant rise in food and energy costs, while Chile registered 7.20% motivated by the delivery of economic aid and early withdrawals of 10 % of pension funds.
In Colombia, the CPI in Colombia closed at 5.62%, marked by the rise in food prices. “Increased demand coupled with supply chain disruptions and rising international energy and food prices have exacerbated the impact on prices,” said Eric Parrado, chief economist at the Inter-American Development Bank ( IDB).
For Hernando Zuleta, professor at the Faculty of Economics at the Universidad de Los Andes, “the costs that Venezuela and Argentina have suffered are associated with the loss of identity of independence, the Executive ends up deciding how monetary policy is carried out. The challenge for the future for these two countries is a little more independence”.
with EFE
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