Economic Survey of Latin America and the Caribbean 1988

image of Economic Survey of Latin America and the Caribbean 1988

In 1988, the economic crisis of Latin America and the Caribbean took a dramatic turn. For the first time since the 1981-1983 recession, the per capita product declined to a level equivalent to that of 1978; inflation almost quadrupled to an unprecedented average of 760%, and real incomes declined in most of the countries.



The international context

When 1988 began, the world was still feeling from the effects of the October 1987 stock market collapse in the industrialized countries. The Latin American and Caribbean region was expected to face a particularly difficult external economic climate as a result of this situation, the persistent fiscal and trade deficits of the United States of America and the corresponding trade surpluses of the Federal Republic of Germany and Japan, together with the general forecasts of a considerable decline in the growth of industrialized countries (which did not even discount the possibility of a recession).


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