ECLAC anticipates expanded spending based on oil and debt

The Economic Commission for Latin America and the Caribbean (ECLAC) keeps its growth estimates for the region at 3.7% in 2012 versus 4.3% in 2011, due to a somewhat slower growth.

In its "Macro-economic report on Latin America and the Caribbean, June 2012," the United Nations regional organization points out that the impact of the European crash, China's slowdown and the low expansion in the United States will be different as per countries and their exporting structure.

The ECLAC estimates that large economies in the Latam region will continue growing, yet at different rates.

On the Venezuelan case, the report brings forward some general attributes of the recent performance.

The paper notes that in 2011 Venezuela's Gross Domestic Product (GDP) raised by 4.2%, while inflation rates remained high at 27.6%.

By 2012, the organization forecasts a quicker GDP, up to 5%, concomitantly with a bigger tax and monetary push, resulting in expanded private and public consumption.

The increasing expenditure of public consumption will be backed by relatively high oil prices; more indebtedness and available funds from the Chinese-Venezuelan Joint Fund and the National Development Fund (Fonden).