United Nations Radio

The Economic Commission for Latin America and the Caribbean-ECLAC says the global economic meltdown stands to significantly affect the region next year.

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As a result ECLAC is projecting a modest growth of 1.9 per cent for the region and expects the rate of unemployment to increase from 7.5 per cent to more than 7.8per cent.

In its report Preliminary Overview of the Economies of Latin America and the Caribbean 2008, ECLAC says the cycle of economic bonanza reached its end in 2008, after six years of consecutive growth in the region.

According to ECLAC, the international crisis is impacting Latin America and the Caribbean through two main channels: the real and financial ones.

In the real economy, exports are already decreasing, especially in countries most linked to developed economies in recession, such as Mexico and some Central American nations. The drop in the price of basic products, particularly fuel, metals, and food, will affect the terms of trade in the region, which, although they continued to improve during 2008, are expected to worsen in 2009.

Another effect is the reduction of remittances from migrant workers, which provide significant income to some Caribbean and Central American economies.

Donn Bobb, United Nations Radio

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