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Ready for Take-Off? Building on Macroeconomic Stability for Growth
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Ready for Take-Off?
2024 Latin American and Caribbean Macroeconomic Report

Coordinated by

  • Arturo Galindo

  • Alejandro Izquierdo

This publication is generative AI enabled. You can have our AI tool summarize the report, list key takeaways, or ask any other question. Click on the Download button above and then the  symbol at the right of the screen.

Highlights
  • Latin America and the Caribbean exceeded growth expectations in 2023 thanks to its strong macroeconomic fundamentals, which helped the region cut inflation and unwind steep spending increases undertaken due to COVID-19.
  • Countries should now focus on lowering interest rates without triggering unintended consequences; reducing fiscal imbalances in a politically charged context; and implementing far-reaching reforms to tackle low productivity and spur long-term growth.
  • To grow their economies and move towards net zero emissions, countries can capitalize on their rich natural endowments, from renewable energy sources to minerals and food.
A New Report Stresses Reforms to Boost Productivity and Seize Markets in an Uncertain World
A New Report Stresses Reforms to Boost Productivity and Seize Markets in an Uncertain World

Ideas Matter - Arturo Galindo - Alejandro Izquierdo

Events
Mar 19 2024
Presentation of the 2024 Latin American and Caribbean Macroeconomic Report: Ready for Take-Off? Building on Macroeconomic Stability for Growth
Inter-American Development Bank | Washington, D.C. | United States of America | 1300 New York Avenue N.W., 2nd Floor | La Plaza

More details here

Ready for Take-Off? Building on Macroeconomic Stability for Growth

Latin America and the Caribbean overcame significant economic challenges in 2023 and exceeded growth expectations thanks to the strong macroeconomic fundamentals it laid in recent years. The region was able to cut inflation through large interest rate hikes and unwind steep spending increases it had undertaken due to COVID-19—a marked departure from previous crises where expansionary measures proved stubborn to reverse. To build on this success, countries now face additional challenges: lowering interest rates without triggering significant capital outflows, exchange rate depreciation, and an increase in inflation; reducing fiscal imbalances due to higher global interest rates in a politically charged context; and the daunting task of implementing far-reaching reforms to tackle low productivity and set the course for long-term growth. As countries chart their path forward, they can capitalize on their rich natural endowments—from renewable energy sources to minerals and food—to grow their economies on the road toward net-zero emissions. The 2024 Latin America and Caribbean Macroeconomic Report analyzes the opportunities and challenges facing the region as it embarks on this journey.

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112 pages
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    DOI
    • http://dx.doi.org/10.18235/0005667
    Previous editions
    Preparing the Macroeconomic Terrain for Renewed Growth

    2023 Latin American and Caribbean Macroeconomic Report

    Preparing the Macroeconomic Terrain for Renewed Growth

    Latin America and the Caribbean faces a triple social, fiscal and growth challenge that is limiting the development of the region and its population. Poverty and inequality levels have worsened, public coffers continue to grapple with the impact of the pandemic, and growth remains below potential. This report explores the main challenges for the region in 2023 in the monetary, fiscal, labor, and financial arenas and identifies public policies that will help policymakers chart a path forward. Latin America and the Caribbean has the tools to address its triple challenge.

    From Recovery to Renaissance - Turning Crisis into Opportunity

    2022 Latin American and Caribbean Macroeconomic Report

    From Recovery to Renaissance - Turning Crisis into Opportunity

    Economic growth in Latin America and the Caribbean was stronger than expected in 2021 but waned at the start of 2022. The surge in commodity prices due to the war between Russia and Ukraine will provide a boost to exporters, while imposing significant costs on commodity importers and pushing up inflation across countries. The ongoing conflict, together with policy normalization in advanced economies, carries significant risks for the region. Volatility in financial markets could depress investment and bring down growth further.

    From Recovery to Renaissance: Turning Crisis into Opportunity

    2021 Latin American and Caribbean Macroeconomic Report

    Opportunities for Stronger and Sustainable Postpandemic Growth

    The year 2020 will be remembered as one of the most challenging in modern history. Latin America and the Caribbean lost 7.4% of GDP, the largest drop on record in a single year. The region is expected to recover in 2021 but faces a hazardous time ahead. Most countries will require some type of adjustment to maintain fiscal sustainability.

    Policies to Fight the Pandemic

    2020 Latin American and Caribbean Macroeconomic Report

    Policies to Fight the Pandemic

    The novel coronavirus is taking a huge toll across the world, and governments in Latin America and the Caribbean are right to take aggressive measures to save lives. Within a matter of weeks, the macroeconomic outlook for the region has changed dramatically. Financing costs have risen, commodities fallen, and large losses of GDP now seem unavoidable.

    Building Opportunities for Growth in a Challenging World

    2019 Latin American and Caribbean Macroeconomic Report

    Building Opportunities for Growth in a Challenging World

    This report analyzes the potential consequences for the region of selected negative external shocks. It considers how countries can strengthen macroeconomic policy frameworks to mitigate these events and the monetary, fiscal, and debt management policy choices available. However, it also considers opportunities. More and better-targeted infrastructure investments can enhance growth prospects. And while public investment is constrained by tight budgets, the window of opportunity to pursue private financing to boost investments remains open as interest rates are still relatively low.

    2018 Latin American and Caribbean Macroeconomic Report

    2018 Latin American and Caribbean Macroeconomic Report

    A Mandate to Grow

    The 2018 Macroeconomic Report, A Mandate to Grow, revisits the growth debate that has been raging in the region for the past half century. Viewing the debate from this long-term perspective allows for a focus on the structural factors that have prevented Latin America and the Caribbean from reaching the growth potential required to keep pace with faster growing regions and to fulfill the aspirations of its population.

    2017 Latin American and Caribbean Macroeconomic Report

    2017 Latin American and Caribbean Macroeconomic Report

    Routes To Growth In A New Trade World

    The 2017 Macroreport considers recent developments in the global economy and how they may affect Latin America and the Caribbean. It reviews how countries are adapting to external conditions and how those policies may be improved. This year, the report focuses particularly on deeper and smarter regional integration as an attractive route to boost productivity and growth.

    2016 Latin American and Caribbean Macroeconomic Report

    2016 Latin American and Caribbean Macroeconomic Report

    Time to Act: Latin America and the Caribbean Facing Strong Challenges

    The commodities boom that once buoyed the region’s economies is over, and countries have less fiscal space to undertake counter-cyclical policies than they did during the global financial crisis. This year’s Latin American and Caribbean Macro Report surveys the challenges facing the region in a new economic era and offers guidance on how policymakers can reduce long-term risks in a period of lower growth.

    2015 Latin American and Caribbean Macroeconomic Report

    2015 Latin American and Caribbean Macroeconomic Report

    The Labyrinth: How Can Latin America and the Caribbean Navigate the Global Economy

    The 2015 Latin American and Caribbean Macroeconomic Report argues that the region is in the midst of a labyrinth and must navigate several global and domestic obstacles—including lower commodity prices and new types of financial risks—to ensure strong and sustainable growth. The report suggests that many countries must make fiscal adjustments to avoid higher debt without compromising the significant social gains of recent years, and details both the types and speed of policies that may be adopted.

    2014 Latin American and Caribbean Macroeconomic Report

    2014 Latin American and Caribbean Macroeconomic Report

    Global Recovery and Monetary Normalization: Escaping a Chronicle Foretold?

    Monetary normalization may be a chronicle foretold, but countries still have the power to influence the outcome for their own economies. This report focuses on the risks Latin American and Caribbean countries face and how they can reduce vulnerabilities and enhance opportunities.

    2013 Latin American and Caribbean Macroeconomic Report

    2013 Latin American and Caribbean Macroeconomic Report

    Rethinking Reforms: How Latin America and the Caribbean Can Escape Suppressed World Growth

    Global growth projections have waned since last year and growth may be suppressed below potential for several years to come. Lower global growth will, all things being equal, imply lower growth in Latin America and the Caribbean. At the same time, clear limits to the potential use of monetary and fiscal policy measures pose another constraint. Consequently, countries should consider further structural reform measures to enhance economic prospects and to escape suppressed global growth.

    2012 Latin American and Caribbean Macroeconomic Report

    2012 Latin American and Caribbean Macroeconomic Report

    The World of Forking Paths: Latin America and the Caribbean Facing Global Economic Risks

    This report details the divergent paths that the world economy may take and their potential effects on Latin America and the Caribbean. Scenarios are constructed employing a modeling exercise that captures the trade, financial and other linkages between the region and the rest of the world. While vulnerabilities remain and external shocks have been and remain critical, the region enjoys many strengths and has developed a growing arsenal of policy tools. What is the balance of vulnerabilities versus strengths? How can countries address the existing vulnerabilities?

    Meet the Editors
    Arturo Galindo

    Arturo Galindo

    Arturo José Galindo Andrade is a Principal Economist at the Research Department of the Inter-American Development Bank in Washington DC. Prior to joining the Research Department in 2021 he was a member of the Board of Directors of the Central Bank of Colombia.

    Alejandro Izquierdo

    Alejandro Izquierdo

    Alejandro Izquierdo is Deputy Director and Head of the Macro Group at the IDB Research Department. He previously held positions as Chief Economist and Manager a.i. of the Research Department, Regional Economic Advisor for Mexico and Central America and Principal Economist.