2024 Latin American and Caribbean Macroeconomic Report: Ready for Take-Off? Building on Macroeconomic Stability for Growth

Abstract

Latin America and the Caribbean overcame significant economic challenges in 2023 and exceeded growth expectations thanks to the strong macroeconomic fundamentals it laid in recent years. The region was able to cut inflation through large interest rate hikes and unwind steep spending increases it had undertaken due to COVID-19a marked departure from previous crises where expansionary measures proved stubborn to reverse. To build on this success, countries now face additional challenges: lowering interest rates without triggering significant capital outflows, exchange rate depreciation, and an increase in inflation; reducing fiscal imbalances due to higher global interest rates in a politically charged context; and the daunting task of implementing far-reaching reforms to tackle low productivity and set the course for long-term growth. As countries chart their path forward, they can capitalize on their rich natural endowments-from renewable energy sources to minerals and food-to grow their economies on the road toward net-zero emissions. The 2024 Latin America and Caribbean Macroeconomic Report analyzes the opportunities and challenges facing the region as it embarks on this journey.