MercoPress. South Atlantic News Agency

Cepal lowers growth estimates

The Economic Commission for Latinamerica and the Caribbean, Cepal, lowered the region's growth prospects for this year from 4 to 3,8%, because of the oil crisis.

"Uncertainty in world markets, influenced by high oil prices and rumours of an increase in US interest rates, makes us think expansion will be closer to 3,8% that 4%", said Jose Luis Machinea Executive Secretary of Cepal.

The price of oil barrel reached this week established new records following insistent rumours of possible terrorist attacks on Middle East plants and pipelines.

During the presentation of Cepal's "Outlook of Latinamerican and Caribbean International Insertion in 2002/03", Mr. Machinea indicated that the good performance of the region's economy at the beginning of 2004 could be threatened by external factors.

"The global escalation of oil international prices and rumours from the US insisting in a coming increase in interest rates by the Federal Reserve, has made us lower our growth estimates to 3,8%", added Mr. Machinea.

Actually Cepal at the end of 2003 forecasted a 3,5% expansion in the region for 2004, but last April increased its estimate to 4%.

The Cepal report indicates that in 2003 the region's exports increased 8,3% but in the first quarter jumped to 17%. For this year Cepal is forecasting exports will expand between 12 and 14%, speared mainly by strong demand from the US and Asian countries particularly China.