150 specialists from 15 countries participated in the analysis of the so-called Economic Climate Index (ICE) of Latin America.
The climate for business in Latin America fell for the third consecutive quarter and stood between July and September 2022 at its lowest level in the last 2 yearsaccording to the indicator released this Monday by the Brazilian center for economic studies Fundación Getulio Vargas (FGV).
Chile, meanwhile, was among the economies that are in a “critical” zone, along with Peru, Mexico and Argentina. In the opposite zone -that is, favorable- it was positioned Uruguay.
According to the FGV, which consulted 150 specialists from 15 countries, the so-called Economic Climate Index (ICE) of Latin America stood at 54.7 points in the third quarter, its lowest level since the second quarter of 2020, when The crisis generated by the covid pandemic plunged the indicator below 50 points.
The indicator is gradually falling from the 101.4 points it reached in the third quarter of 2021, when the region seemed to have overcome the serious economic crisis caused by the pandemic.
The worsening of the business climate once once more placed the indicator below pre-pandemic levels (85.9 points in the first quarter of 2020) and almost 13 units below that registered in the second quarter of this year (67.3). points).
According to the study, the drop in the indicator is mainly the result of the pessimism with which economists face the future, and not so much regarding the economic situation in the region.
While the Current Situation Index (ISA), which reflects the situation, fell less than 5 points, from 48.8 points in the second quarter to 44.3 points in the third, the Expectations Index (IE), which measures projections for the next 6 months, lost more than 20 points (from 87.2 to 65.5).
“The worsening of expectations sets off a warning signal because it indicates that specialists expect an economic slowdown for the coming months”, according to the FGV.
According to the study, the business climate only increased in the third quarter in 2 countries (9.9 points in Paraguay and 1.7 points in Bolivia), while it fell sharply in the others, starting with Uruguay ( -27.0 points).
Despite this sharp drop, Uruguay continues to be the country with the best business climate in the region, with 122.6 points, followed by Paraguay (101.1 points). These two economies are the only ones in which the indicator is in the area considered favorable (above 100 points).
Lastly, in the unfavorable zone Colombia was located, with 72.6 points following having lost 23.1 units, Ecuador (70.5), Bolivia (67.6) and Brazil (54.5), and in the most critical area Peru (49.7), Mexico (48.7), Chile (36.2), Argentina (25.8) and Venezuelawhich ceased to be evaluated.