From Realtà Mapei International n° 78 - 1/21/2020
In 2019, growth in the Latin American economy still hasn’t been able to be kick-started after a more or less stagnant 2018. The forecasts of the IMF (International Monetary Fund) have “trimmed” estimates even further to reach more or less 0%. The economic and financial problems Argentina is facing, political turmoil in Venezuela coupled with a collapse in trade (-35% for the GDP in 2019 and -10% in 2020), the uncertainties in Brazil and the weakness in investments in Mexico are all impacting the situation.
But Latin America is travelling at two different speeds. The brake put on growth by the major economies is being counteracted by the dynamic economic positions of the “smaller” countries, such as Peru and Colombia, where the economy is forecast to grow in spite of the period of general stagnation of the continent.
Within this not particularly brilliant overall picture, the unfavourable economic slump in the construction sector needs to be highlighted, which in 2018 recorded the worst trend at global level with a strong drop in investments. Signs of an inversion in this trend, albeit rather weak, are expected in 2020. In fact, in the two-year period 2019-2020, investments in residential constructions are forecast to grow by 2.3% across the continent as a whole, with an expansion cycle driven by Chile and Peru which, along with an upturn in the Brazilian market, will all play their part in bringing the dynamics of investments back into positive, in spite of the decline of the Argentinian market well into 2019.