Recovery could be ahead for South American economies

Recovery could be ahead for South American economies

Analysts are still looking forward to an economical recovery in 2004 for South American countries. The two major economical organizations in the continent; i.e. Mercosur and the Andean Pact are negotiating for cooperation, lowering trade barriers in an effort to get prepared for potential bigger trade agreements with the northern American countries. Some Latin American countries are still in trouble economically while some are enjoying good news. First of all the weak Argentinean economy is still under cautious measures after the huge crisis. IMF and the World Bank have been providing support but also seriously monitoring the developments. The largest economy in South America is of course the Brazilian economy, but it also possesses huge external debt. Economists hope that the local demand may pick up a little bit next year, but GDP growth is not expected to reach even 1%. Elsewhere, devaluation is a strong possibility in Venezuela, where the GDP per capita has literally eroded during the past few years. High GDP growth rate is nothing more than a dream in Ecuador as the government fails to introduce structural reforms packages. On the other hand, inflation in Colombia looks to be slowing down further with steady economical growth which is promising for the country. Chile is also looking forward to further growth in its GDP and decreasing inflation rates for the next couple of years. Another Latin American country looking ahead smiling could be Peru. Inflation is expected to remain at low numbers and economical growth is forecasted as close to 4%.