Latin America and the Caribbean (LAC) is expected to record economic growth of 6.3 per cent in 2021, according to the latest edition of the International Monetary Fund’s (IMF) World Economic Outlook released on Tuesday.
It said the LAC should record three per cent in 2022 and that Guyana is expected to register the highest level of economic growth among the 33 countries in the region.
According to the IMF, Barbados is expected to record a 3.3 per cent growth, Jamaica, a 4.6 per cent and Trinidad and Tobago, a 0.1 per cent, Aruba a 12.8 per cent growth, Panama a 12 per cent, Chile a 11 per cent and Peru a 10 per cent growth.
The IMF increased its 2021 economic growth projections for Guyana despite the adverse implications of the nationwide flooding earlier this year.
According to the Washington-based financial institution, Guyana’s real gross Domestic Product (GDP) is now expected to increase by 20.4 per cent this year, higher than an earlier projection 16.4 per cent made in April.
Additionally, the IMF reports that Guyana’s economy is expected to grow by a further 48.7 per cent in 2022, up from the earlier projection of 46.5 per cent.
In its report, the IMF said the ongoing hit from the coronavirus (COVID-19) pandemic and the failure to distribute vaccines worldwide is worsening the economic divide and darkening prospects for developing nations.
Global economic growth this year and next is expected to continue as the recovery solidifies broadly, but the overall figures mask large downgrades and ongoing struggles for some countries.
“The outlook for the low-income developing country group has darkened considerably due to worsening pandemic dynamics,” IMF chief economist Gita Gopinath said.
She said the “great vaccine divide,” will impact the restoration of living standards, and a prolonged pandemic downturn “could reduce global GDP by a cumulative US$5.3 trillion over the next five years.
Output worldwide is expected to grow 5.9 per cent this year, only slightly lower than projected in July, before slowing to 4.9 per cent in 2022, the report said.
But the wave of infections from the Delta variant of COVID-19 and the drastically lower vaccination rate in developing nations, along with supply bottlenecks, have slowed or pushed back the recovery in many economies.
“The dangerous divergence in economic prospects across countries remains a major concern,” Gopinath said.
She said advanced economies are expected to regain “pre-pandemic trend path in 2022 and exceed it by 0.9 per cent in 2024”.
However, in emerging markets and developing economies, excluding China, output “is expected to remain 5.5 per cent below the pre-pandemic forecast in 2024”.
“A principal common factor behind these complex challenges is the continued grip of the pandemic on global society. The foremost policy priority is therefore to vaccinate at least 40 per cent of the population in every country by end of 2021 and 70 per cent by mid-2022.
“This will require high-income countries to fulfil existing vaccine dose donation pledges, coordinate with manufacturers to prioritise deliveries to COVAX in the near-term and remove trade restrictions on the flow of vaccines and their inputs.
“At the same time, closing the US$20 billion residual grant funding gap for testing, therapeutics and genomic surveillance will save lives now and keep vaccines fit for purpose. Looking ahead, vaccine manufacturers and high-income countries should support the expansion of regional production of COVID-19 vaccines in developing countries through financing and technology transfers,” Gopinath said.
