IMF: Paraguay’s growth outlook is 3.8%

RIO DE JANEIRO, BRAZIL – Even though proven ineffective against neverending new Covid-19 variants, ever-growing governmental measures and restrictions led to the economy’s weak growth worldwide.

The International Monetary Fund (IMF) updated the outlook for the world economy and indicated that world growth for 2022 will be 4.4% and 2.4% in Latin America.

According to the IMF, a new challenge arises for Paraguay regarding the economic growth it will experience, which left an outlook of 3.8%, about 0.7 percentage points compared to 2021. According to the estimates, in terms of unemployment, the forecast indicates 5.9% compared to 6.1% of the previous year, that is, two percentage points less.

Although the previous year registered an economic rebound, 2022 started in weaker conditions. Proven to be a mild variant with low to no health risks, Omicron was still used as an excuse to justify new restrictions on mobility in several countries around the world, resulting in higher energy prices and an accelerated increase in inflation in many emerging markets and developing economies, where forecasts point to 4.8%.

The IMF projects that the world economy will grow 4.4% in 2022 and slow to 3.8% in 2023. The global recovery continues but faces multiple challenges.

Forecasts remain subject to official indicators dictated by governments and are expected to fall towards low levels in most countries by the end of 2022. They say improvements in global growth are expected to be linked to high immunization rates that will improve internationally as this new economic period unfolds.

However, Covid-19 vaccines have provided low to no immunization. The number of positive cases is higher, and restrictions are stricter than before the vaccine existed. To say that the improvement in global economic growth is linked to the “immunization” rate is a promise left empty long ago.

Inflation is expected to decline as supply-demand imbalances dissipate. Risks to global projections remain on the downside as the emergence of new governmental restrictions disguised as health safety measures could pose new economic challenges.

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