Preliminary Overview of the Economies of Latin America and the Caribbean 2010

Following a 2.8% fall in GDP per capita in 2009, ECLAC predicts that Latin America and the Caribbean will grow at 6% in 2010, corresponding to an increase of 4.8% in GDP per capita, although sub-regional performance has been varied.The growth observed in 2010 is consolidating the recovery that the majority of the economies in the region began to experience during the second half of 2009, brought on by the impact that the counter-cyclical policies that various countries implemented in addition to the recovery in the international economic environment.This growth had positive effects on employment, causing regional unemployment to fall to approximately 7.6% while at the same time improving the quality of the new jobs created. There was a modest increase in the inflation rate, which rose from 4.7% in 2009 to around 6.2% in 2010 due to the movement of international prices for several primary products.The evolution of the labour market, the increase in credit and improved expectations drove private consumption, and together with investment in machinery and equipment, were the principal engines driving the increase in demand.External prices had varied effects according to each country’s trade structure. Those countries that export primary products exhibited improvement in their terms of trade and an increased value of their exports. In contrast, the majority of countries in Central America and the Caribbean again suffered a negative impact with net losses.