IMF pointed to the growing populism in some Latin American countries as well as corruption scandals as the risks that could have a strong impact on the economic outlook…//
The International Monetary Fund (IMF) ratified the growth prospects for Mexico, but warned that the electoral process is a factor that could worsen the atmosphere of uncertainty.
The organization pointed to the growing populism in some countries of the region as well as corruption scandals, as examples of risks that could have a strong impact on the economic outlook.
In the Regional Economic Perspectives released Friday, the IMF pointed out that the elections that will take place this year in several countries could worsen the economic and political uncertainty.
Among the risks for the region as a whole, the IMF pointed out the populist trends in main economic realms, such as in trade and migration flows, could derail the budding recovery in the region.
In the report Regional Economic Perspectives: Taking Advantage of the Momentum, the importance of strengthening the credibility of central banks and the continuation of efforts to reduce public debt is highlighted.
Because Latin America continues to be the most unequal region in the world, The report called for combating poverty through the increase in income tax collections from individuals and rebalancing public spending to maintain social transfers and investment in infrastructure .
For 2018, the IMF projected positive growth above the historical average of 2.3% and 3% for 2019, the same estimates considered in the World Economic Outlook (WEO) report that was released in April prior to the Spring meetings in Washington, in which an attack on corruption was urged.
However, the momentum that the United States will provide the region will not last, the report warned.
“In the short term, Mexico, Central America and parts of the Caribbean have benefited from the most vigorous growth in the United States, although at the same time the potential implications of the tax reform in that country and the renegotiations of the Free Trade Agreement of North America (NAFTA) are creating uncertainty,” Friday’s report said.
Text: El Universal
