A Bumpy Road Ahead - Finance & Development, September 2013

A Bumpy Road Ahead - Finance & Development, September 2013: "Latin America needs large and sustained productivity gains to maintain its recent strong growth

Latin America has enjoyed strong GDP growth in the past decade. The region grew 4 percent a year, almost twice the rate it recorded in the 1980s and 1990s. The strong growth was accompanied by declining inequality, poverty, and public debt levels. The improvement in the region’s living standards was unprecedented—in the past decade, real GDP per capita increased by more than 30 percent, about two times faster than in prior decades.­
The strong growth, however, masks important differences within the region (see Chart 1). The net commodity exporters—that is, the South American countries, which exhibited increasing commodity dependence and an export base highly concentrated in primary goods—have grown, on average, 4.5 percent a year since 2003. But the rest of the region—Mexico, Central America, and the Caribbean—was much less buoyant, growing only about 2.5 percent a year.­"

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