MercoPress. South Atlantic News Agency

Rare praise for Argentina’s economy performance from the World Bank

Economist de la Torre: “relatively endogenous engines of growth are subsisting in the country”

Argentina will grow at an enviable rate compared to other countries in the region, Chief Economist for the World Bank’s Latin America and Caribbean Office Augusto de la Torre said this week, commenting on the institution’s projections for next year.

“This year, Argentina is above the region’s average in terms of growth,” the economist stated, adding the number “rates fairly favourably in comparison” with the collective estimate of 2.5% for Latin American and Caribbean countries as whole.

On Tuesday, the IMF brought down its World Economic Outlook report forecast figures for Latin American growth to 2.7%.

Both institutions’ projections for Argentina are below the Kirchnerite administration’s optimistic forecast of 6.2% economic growth next year, according to the 2014 Budget.

Despite slashing growth rates, the World Bank described the region as resilient in the face of an adverse international climate.

Describing Argentina’s situation as “similar to what is seen in Chile and Colombia, De la Torre argued that such growth “means that relatively endogenous engines of growth are subsisting in the country.”

“Depreciation of currencies has helped soften the blow of adverse international economic circumstances,” he added, noting that it not only helps lower the cost of exports but also raise the cost of imports, making the export and local industries more competitive and boosting job creation.

The report adds that the region’s giants, Brazil and Mexico, are growing below the average, with Mexico’s growth falling below 2% despite the ongoing wave of reforms fuelling investor optimism.

But low growth, coupled with a less supportive global environment, will not, as sceptics warn, translate into 1990s-style financial distress, the report states.