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Tuesday, July 5, 2022

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World Bank maintains growth projection for the Dominican Republic

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The Dominican Republic is one of the few countries in Latin America and the Caribbean for which the World Bank did not change -nor did it decrease, as it did for almost two dozen nations- its growth projection for this 2022, in its most recent report “Perspectives world economics”.

The multilateral organization maintains the country’s growth projection at 5.0% for this 2022 and also for next year, as indicated in a similar report published in January of this year.

However, it projects a drop of -0.4% for the Haitian economy in 2022, of which it did not indicate any growth in its report in January.

The World Bank notes that, “compounding the damage caused by the COVID-19 pandemic, the Russian invasion of Ukraine has exacerbated the slowdown in the world economy, which is entering what could become a prolonged period of low growth. and high inflation.

It warns that this context increases the risk of stagflation (a period of high inflation combined with economic stagnation), “with potentially damaging consequences for both middle-income and low-income economies.”

In its latest report, the bank forecasts global growth to slow from 5.7% in 2021 to 2.9% in 2022. This is down from the 4.1% it forecast in January.

It also anticipates that it will oscillate around that rate during the 2023-2024 period, as the war in Ukraine affects activity, investment and trade in the short term; pent-up demand dissipates, and accommodative fiscal and monetary policies are phased out.

Latin America and the Caribbean

The World Bank maintains practically unchanged its economic growth forecast for Latin America and the Caribbean this year. The percentage of growth forecast for the region fell by only one tenth: from the 2.6% projected in January to the current 2.5%.

But, it reduced the forecast for the next 2023, which it had placed in January at 2.7% and lowered it to 1.9%, before rebounding slightly to 2.4% in 2024.

For the Caribbean alone, it projects growth of 6.9% in 2022 and 6.5% in 2023, favored by the recovery of tourism.

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