After the Boom–Commodity Prices and Economic Growth in Latin America and the Caribbean

August 14, 2014

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Format: Chicago

Bertrand Gruss. After the Boom–Commodity Prices and Economic Growth in Latin America and the Caribbean, (USA: International Monetary Fund, 2014) accessed September 18, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

After skyrocketing over the past decade, commodity prices have remained stable or eased somewhat since mid-2011—and most projections suggest they are not likely to resume the upward trend observed in the last decade. This paper analyzes what this turn in the commodity price cycle may imply for output growth in Latin America and the Caribbean. The analysis suggests that growth in the years ahead for the average commodity exporter in the region could be significantly lower than during the commodity boom, even if commodity prices were to remain stable at their current still-high levels. Slower-than-expected growth in China represents a key downside risk. The results caution against trying to offset the current economic slowdown with demand-side stimulus and underscore the need for ambitious structural reforms to secure strong growth over the medium term.

Subject: Commodities, Commodity price fluctuations, Commodity price indexes, Commodity prices, Prices, Production, Production growth

Keywords: Caribbean, Commodity, Commodity export price index, Commodity exporter, Commodity exporters of LAC, Commodity mix, Commodity outlook, Commodity price, Commodity price fluctuations, Commodity price indexes, Commodity price projection, Commodity prices, Commodity spot prices, Commodity supply, Commodity-price VARX, Food commodity, Global, Global VAR (GVAR), Latin America, Output, Output growth, Price outlook, Price scenario, Production growth, WP

Publication Details

Pages:

43
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2014/154
Stock No:

WPIEA2014154
ISBN:

9781498363518
ISSN:

1018-5941

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