"After a sharp downturn in 2020, only a mild and multi-speed recovery is expected in Latin America and the Caribbean in 2021," is the IMF forecast, according to which the region will grow at an average rate of 4.6 percent, half a point above what was considered in January.
The analysis states that this average growth will be achieved with the region pulled by the large exporting economies, namely Argentina, Brazil, and Peru, countries that have gained air thanks to the upturn in global manufacturing production.
However, the report itself recalls that foreign trade in Latin America had its worst performance in 2020 since the Great Recession (2008) when it plummeted by 13 percent. Still, the drop was 10 points less than expected due to the rebound in demand in the region's main partners, especially China, according to a study by the Economic Commission for Latin America and the Caribbean (ECLAC).
Therefore, the rebound in countries such as Brazil, Mexico, or Argentina should not be taken with too much optimism since their forecasts are made compared to previous very negative indicators. It is estimated that these three countries will grow 3.7, 5, and 5.8 percent, respectively.
Likewise, another factor that impacts the growth forecast and that should not be mistaken for a magical recovery is the effect of the US bailouts that have benefited Brazil and Mexico.
According to IMF spokespersons, this is a package of 1.9 trillion dollars in fiscal stimulus, of which Mexico and Brazil will be the primary beneficiaries.
On the other hand, the Caribbean nations maintain their growth prospects downward, 2.4 percent growth according to IMF forecasts. These nations are highly dependent on tourism and will not enjoy any bailout.
The financial organization states that, along with these projections, what will affect recovery will be the pandemic's evolution, which is why they define its containment as a priority strategy, primarily through vaccines' administration.