Paraguay tops the list for the highest economic growth in the region, according to the World Bank

The economic outlook for Latin America and the Caribbean by the World Bank places Paraguay once again at the top of the ranking for 2024, with a projected growth of 3.8%.

Following Paraguay are Uruguay, with a potential growth of 3.2%; Peru, 2.9%; Chile, 2.6%; Brazil, 2.2%; and Bolivia, 1.5%. In contrast, according to the recently released report, Argentina is expected to experience a decline of -3.5% in its economy.

The World Bank noted that in the final stretch of 2023, economic growth in the Latin America and Caribbean region slowed due to the persistent effects of monetary tightening. It highlighted that while there were some signs of economic consolidation at the beginning of 2024, the recovery has been uneven across the region. Overall, inflation rates are decreasing, and central banks have begun to reduce official interest rates from the high levels of 2023.

The report states that this year’s projections indicate that commodity prices will support the region’s exports, although weak growth in China could limit the demand for major commodities.

Paraguay is opening new markets for its agricultural and livestock exports. Recently, it sent its first beef shipment to Canada, emphasizing the progressive increase in exports to the North American market.

Additionally, other initiatives have been launched to sell electric power to Brazil, contributing to the country’s growth, along with other economic measures promoted by the current government.

The World Bank report notes that forecasts are exposed to several downside risks. These include the possibility of tighter global financial conditions, high levels of local debt, and a slowdown in China’s growth, which will impact the region’s exports. It also mentions that extreme weather events related to climate change represent a risk.

The report concludes that while the Latin America and Caribbean region will face economic challenges in 2024, it is expected to show gradual recovery in 2025, supported by decreasing inflation and accommodative monetary policy.

«The economic performance of the region will depend on a combination of internal and international factors, and commodity prices and global demand will play a moderate role in this outlook,» emphasizes the multilateral organization.

Source: Agencia de Información Paraguaya

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