BASSETERRE, St. Kitts - THE Inter American Development Bank (IDB) has reported that the Caribbean and Latin American region has seen small growth in their economies in 2013 due to increased productivity, as Loans, Grants and Guarantees totalled approximately $14 billion.
In its yearend round up, the IDB explained that the economic performance of Latin America and Caribbean economies were affected by a “high degree of volatility that rattled international financial markets and the fall in prices for basic goods took a toll on the region’s GDP growth, which averaged 2.7 percent. In 2014, the growth forecast for the economies of Latin America and the Caribbean as a whole is 3.0”.
However, IDB President Luis Alberto Moreno explained that the external environments would play an integral role in regional economy, but in 2014 the region should not be dependent on the international markets to push growth.
“A less favorable external environment, along with weak external demand over the mid-term and latent risks in international financial markets will require the region to accelerate growth without depending on the external conditions that helped us in the past decade,” IDB Moreno said.
“Therefore, our priority is to increase potential output over the medium term through reforms focusing on bottlenecks that are restricting growth in productivity, internal savings and investment,” he added.
Moreno was at the time presenting his yearend report to the Bank’s Board of Executive Directors.
He made calls for improvement in the quality of education being provided in the Latin American region, noting that the region’s performance in the Programme for International Student Assessment (PISA) test was not as good as those in other regions around the world.
“In the 2013 PISA test, Latin American youths did not perform nearly as well as students from other regions of the world!” he said exclaimed.
Moreno stressed that both the Latin America and Caribbean regions have greater developmental works to do on their infrastructure, as a gap currently exist between “the region and the world richest and most dynamic countries”.
“Besides modernising their highways, ports and airports, the countries of Latin America and the Caribbean must improve infrastructure and logistical services in order to lower transaction costs and make their industries more competitive,” Moreno explained.
The IDB in 2013
According to the Inter American Development Bank’s preliminary data, in 2013 the institution approved some 167 financing packages worth some $14 billion, a figure surpassed only by that of 2009. And during the financial crisis the bank financing hit a whopping $15.9 billion.
As for resources, new operations centered on high-priority sectors such as institutional development (37 percent), infrastructure and the environment (33 percent), social welfare programmes (21 percent) and regional integration and overseas trade (9 percent).
Among the loans and guarantees approved by the IDB in 2013, private-sector operations (without a sovereign guarantee) totalled $2.1 billion.
