MercoPress. South Atlantic News Agency

Mexico and Chile most expensive countries in Latam

Chile is the second most expensive country in Latin America, according to a preliminary report released Monday by the World Bank's International Comparison Program (ICP). Of the 11 Latin American countries included in the study, only Mexico was found to be more expensive than Chile.

Data for the ICP study was gathered in 146 world economies during 2005. In order to determine how expensive economies are in relation to one another, the study analyzed the experience of travellers who made purchases after exchanging their currency at market rates. Chile had a price level index (PLI) of 60 on a scale that placed the United States' economy at 100, while Mexico's PLI was 65. Both countries, like all economies with PLIs lower than 100 have relatively lower prices than the U.S. Bolivia has the least expensive economy in Latin America and one of the cheapest in the world, ranked near Tajikistan, Ethiopia, Gambia, and the Kyrgyz Republic. In what a World Bank press release called "the most extensive and thorough effort ever to measure PPPs (Purchasing Power Parities) across countries," the study also compared the relative purchasing power of the currencies of the 146 participating economies. With a per capita PPP of US$12,277, Chile leads Latin America in this indicator. Behind Chile are Mexico and Argentina whose respective per capita PPPs reach US$11,317 and US$11,076. In all three countries, per capita PPP surpasses the Latin American average of US$9,064. The list follows with Venezuela and US$ 9.888; Uruguay, US$ 9.222 and Brazil, US$ 8.606. The two Latin American economies with the lowest per capita PPPs are Paraguay (US$3,905) and Bolivia (US$3,623), where purchasing power is lower than that of China, but higher than that of India.