Argentina And Venezuela Lead Latin America’S Recession Tally
Date
10/8/2024 8:19:42 AM
(MENAFN- The Rio Times) Argentina and Venezuela have been identified as the most recession-prone economies in Latin America over the past 70 years, according to data from The conference Board.
Argentina has faced 25 economic downturns since 1951, securing the second spot globally for recession frequency. Venezuela follows suit, ranking ninth worldwide with 20 economic declines during the same period.
The global recession rankings paint a diverse picture of economic struggles across continents. Libya tops the list with 29 economic contractions, while Syria and Iraq from the Middle East occupy the third and fourth positions, respectively.
European nations Ukraine and Moldova also feature prominently, alongside African countries like the Democratic Republic of Congo, Chad, and Sudan.
Within Latin America, Argentina and Venezuela stand out for their frequent economic woes. Other regional economies have shown more resilience, with Mexico experiencing eight downturns and Brazil seven since 1980.
Chile follows with six recessions, Ecuador with five, and Colombia impressively maintains its stability with only two economic contractions during this period.
Economic Stability in Colombia vs. Argentina's Challenges
Colombia's economic performance has remained relatively stable due to its focus on internal production and exports. Clara Inés Pardo, an economics professor at Universidad del Rosario, attributes this strength to Colombian businesses driving sustained growth.
This approach has helped the country maintain a positive economic trajectory despite regional challenges. Argentina's economic struggles stem from unstable macroeconomic policies that promote volatility rather than stability.
Andrés Giraldo Palomino, an economics expert from Universidad Javeriana, identifies several factors contributing to Argentina's frequent recessions.
These include the erosion of central bank independence, monetary emissions to finance public spending, and disorderly fiscal policies. Additionally, high public debt, persistent fiscal deficits, and hyperinflation have plagued Argentina's economy.
The country's high protectionism and limited international competitiveness beyond agricultural products have further hindered economic growth. These factors combined have created a challenging environment for sustained economic stability.
President Javier Milei has taken office with a pledge to lead Argentina out of its economic crisis. His approach includes reducing monetary financing of public spending, which has led to both social and economic costs.
The success of Milei's economic plan hinges on achieving positive outcomes, such as debt reduction and resource generation.
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