Latin American economy to grow 3.7 percent in 2012: UN panel

Santiago, Dec 22 (IANS/EFE) Latin American and Caribbean nations will enjoy growth of 3.7 percent in 2012 after expanding 4.3 percent this year, the UN Economic Commission for Latin America and the Caribbean says in a report released here Wednesday.

The region's prospects are being dimmed by a slowing in the world economy and heightened volatility in global financial markets, ECLAC said.

The 2011 figure masks sharp divergences within the region, as while both South America and Central America grew at better than 4 percent, the Caribbean managed only 0.7 percent growth.

Among individual countries, this year's strongest performers are Panama, up 10.5 percent; Argentina, 9 percent; Ecuador, 8 percent; Peru, 7 percent; and Chile, whose economy expanded 6.3 percent.

The region's economic powerhouse, Brazil, grew a more modest 2.9 percent after setting a torrid pace in 2010.

The overall unemployment rate for the countries monitored by ECLAC fell from 7.3 percent last year to 6.8 percent in 2011 and is expected to remain at that level in 2012.

Latin America and the Caribbean grew 5.9 percent in 2010 and remained vigorous into the first half of this year before slowing as a consequence of the worsening global situation.

'Besides the impact of the increasingly complex external context, the smaller growth in 2011 is explained by the measures applied in Brazil to cool domestic demand and avert an overheating arising from the strong expansion in 2010,' the ECLAC document says.

The region is not immune to the pervasive global uncertainty, the panel warned.

Latin America and the Caribbean are better prepared to cope with a global recession, thanks to substantial international reserves, sound public finances and moderating inflation, according to ECLAC.