Bloomberg Línea — Peru’s Economy and Finance Minister Pedro Francke has announced the revision of certain economic projections for 2022, considering that Peru will likely emerge as having been the fastest-growing economy in South America at the end of last year, with definitive figures for 2021 to be released in February. After record 13% GDP, which exceeded the expectations of analysts and the government itself, Francke has lowered economic growth forecasts for 2022 from 4.8% to 3.5%-4%.
And in Venezuela, the collection of signatures required to call for a referendum on the leadership of President Nicolás Maduro will take place on Wednesday, January 26.
Following is a roundup of Monday’s news from our reporters across Latin America.
Argentina
· In the midst of negotiations with the International Monetary Fund (IMF) and in view of the growing uncertainty related to this Friday’s due date on which Argentina must make a debt repayment, President Alberto Fernández stated that it is necessary to “remember” what happened in the 2001 crisis and how the country suffered. The management of inflation is at the center of the discussion and in the next few days the debate on how much gas tariffs should be increased will once again be on the table.
Brasil
· President Jair Bolsonaro kept funds to increase salaries for some public servants in this year’s budget, as growing concerns about government spending ahead of the October election drive investors to revise up their expectations for inflation. Latin America’s largest economy is expected to end the year with a primary fiscal deficit of 79.3 billion reais ($14.55 billion), not taking into account interest payments, according to the 2022 budget Bolsonaro signed into law on Monday.
· Veteran emerging markets investor Mark Mobius warns of a complex situation in Brazil amid an uncertain domestic political environment and rising interest rates. “The scenario for Brazil is a bit murky, with heavy clouds,” said Mobius, who left Franklin Templeton Investments in 2018 to establish Mobius Capital Partners.
Chile
· Chile’s President-elect Gabriel Boric said he will now oppose further withdrawals from the country’s pension funds, after voting in favor of previous withdrawals as a congressman. With withdrawals, “workers’ savings continue to be emptied”, he said in an interview. This change of tone would lower Chile’s risk premium, according to an analysis by Citi (C), although Fitch considers that fiscal prudence remains a challenge for the new government.
Colombia
· Colombian public policy think tank Fedesarrollo reported Monday that business confidence decreased in the last month of 2021, with the industrial confidence index falling in greater proportion (-3.6 percentage points) than the commercial confidence index, which saw a reduction of 0.2 pps. In addition, the National Association for Sustainable Mobility calculated that for every new vehicle that enters into circulation, 4.5 used vehicles are on the country’s roads. Also, Bloomberg Línea spoke exclusively with Miguel Olmi, CEO of discount retailer Justo&Bueno, about the company’s reorganization plan.
Ecuador
· Employment in Ecuador recovered in the last year, rising from 30.4% to 33.9% between December 2020 and December 2021, the National Institute of Statistics and Census reported Monday. And last year, Ecuadorian company Santa Priscila became the world’s leading exporter of shrimp to the U.S.
Mexico
· Mexico’s annual inflation slowed slightly less than expected in early January, but remained well above target, leaving the central bank in a complex situation amid signs that the economy is in recession. Mexico’s manufacturing industry started 2022 with absenteeism and production delays due to the spread of the Omicron variant. During the day, Grupo Televisa (TLEVICPO) received the necessary regulatory approvals to merge its media business with U.S. network Univision Communications.
Peru
· During a presentation on Peru’s economic performance through 2021 and of expectations going forward, Economy and Finance Minister Pedro Francke detailed the revision of certain economic projections for 2022. Peru is likely to have positioned itself as the fastest growing economy in South America at the end of last year, with record 13% growth of GDP expected (with the definitive figures still to be published), which exceeded the expectations of almost all analysts and the government itself, while for 2022 the ministry has revised its projection of economic activity growth downward, from 4.8% to 3.5%-4%.
Venezuela
· The collection of signatures to activate a referendum process against President Nicolás Maduro will take place on Wednesday, January 26. Part of the Maduro regime and its supporters remain silent in view of the recall and a possible successor to Maduro is being considered.
