Macroeconomic and Automotive Prospects of Select Latin American and Caribbean Countries, Forecast to 2023

Description

This research tracks the economies of Costa Rica, the Dominican Republic, Guatemala, Jamaica, Panama, and Puerto Rico. The research provides insights into the macroeconomic and automotive outlook for these select Latin American and Caribbean economies, with forecasts until 2023. Topic areas analyzed include the gross domestic product (GDP) growth, the labor market, and the light vehicles sales outlook for the countries in focus.
While Costa Rica, Guatemala, Jamaica, and Trinidad and Tobago are expected to see their GDP growth rate marginally rise over the forecast period, the Dominican Republic and Panama are expected to see a marginal dip in GDP growth while nonetheless maintaining strong growth rates of over 5%. Puerto Rico, however, continues to remain in recession, with growth expected to remain negative until 2024.

Emergence from recession is expected by 2025, supported in particular by widespread reform activities. Potential attainment of statehood by 2025 is expected to help bring in more funding and further accelerate medium-term growth. All the countries are expected to see unemployment rates decline in the forecast period. The declining trend in Puerto Rico, however, is not so much a positive sign, because it is largely being driven by migration, with skilled workers in particular migrating from the country in large numbers. Guatemala has the lowest unemployment rate amongst the countries in focus, with an unemployment rate of 2.3% in 2018, that is expected to dip to 2.0% by 2019, supported in particular by a pick-up in economic activity. While Guatemala’s official unemployment is low, informal unemployment rates, however, are high. Trinidad and Tobago saw its unemployment rise in 2018, with unemployment levels expected to slide going forward, since the country has emerged from recession. As a result of the light vehicles sales outlook, Costa Rica, Guatemala, and Jamaica are expected to see sluggish growth over the forecast period while the Dominic Republic, Panama, and Trinidad & Tobago will grow faster primarily due to positive economic conditions. Puerto Rico is not expected to see a spike in sales in the next 5 years.