Positive outlook for economy in Latin America and Caribbean.

In 1996, Latin America and the Caribbean returned to the path of moderate growth with stable prices that characterized the regional economy in the nineties before the eruption of the Mexican financial crisis at the end of 1994, according to estimates contained in a preliminary overview of the region's economy, released on 19 December 1996 by the Economic Commission for Latin America and the Caribbean (ECLAC).

Countries in the Latin American and Caribbean region registered an average growth in the region of some 3.5 per cent (1.5 per cent per capita) for 1996, and average inflation fell to 20 per cent. More than half the countries registered single-digit price increases or very little more. Growth was due to a sustained expansion of exports and to greater access to external finance; the increase in the volume of exports was almost three times the growth of the gross domestic product (GDP).

The region is improving its ability to attract external finance, both in volume and type, although most such finance still goes to the larger economies.

Prices of the commodities most important for the region evolved unevenly For example, prices of many metals and coffee fell, while grain prices rose. Oil prices were higher than in previous years, which favoured exporters, but created difficulties for importers. Average regional inflation continued to fall in 1996 - to 20 per cent - the lowest rate since the beginning of the 1970s. Economic stability remained a priority for the majority of the Governments of the region.

Great variations in economic performance characterized the region in 1995 - Mexico and Argentina contracted, while other countries continued to expand. With 1996 showing greater homogeneity, Mexico and Argentina registered positive growth, although not enough to counteract the fall of the previous year. On the other hand, several economies expanded more slowly in 1996, due to the adoption of policies aimed at reducing inflation (Brazil, Chile, Costa Rica and Colombia), or due to avoiding balance of payments problems (Peru). As a result, growth fluctuated between 3 and 5 per cent in most countries, only surpassing those rates in Barbados, Chile, Guyana, Nicaragua and the Dominican Republic. The more favourable evolution of growth has not been translated into increased employment.

On the contrary, unemployment continued to rise after a considerable increase in 1995 and is becoming...