Tentative recovery expected in 2010

Contrary to previous expectation, Latin America will not escape a recession in 2009, according to credit insurer Coface. While very few of the regional countries seem exposed to either a monetary or financial crisis, Latin America has shown a certain capacity to withstand the global crisis, but with Central and North America suffering greatly, experts are predicting a 2% decline that will give way to a tentative recovery in 2010. The foreign trade pattern of Latin America is characterised by a relative dichotomy. Highly dependent on North American demand, Mexico, Central America and the Caribbean have been severely affected by the recession in the United States. “Conversely South America benefits from more geographically diversified trading partners with its natural wealth making it particularly attractive to Asian countries, especially China,” according to Coface. Coface predicts that the situation in the region will prove to be manageable for most of the large economies like Brazil, Colombia, Mexico and Peru. Costa Rica, El Salvador and Guatemala will not be so lucky.