REVISITING BALANCE-OF-PAYMENTS CONSTRAINED GROWTH 70 YEARS AFTER ECALC’S MANIFESTO: THE CASE OF SOUTH AMERICAIn the period 2014-2018, South American economies experienced a low growth rate in a historical perspective and compared with other developing regions. The paper discusses the structural sources of recent macroeconomic performance in these countries, associated with their specialization on natural resources, inspired by Raúl Prebisch 1949 “Manifesto”. It also poses that the increasing dependence on external borrowing as in the 2014-2018 period derived from the deepening of current account deficits could worsen growth constraints in the coming years, insofar as these financial flows do not contribute to a change in the productive structure, shifting the focus from export weakness to debt sustainability issues.
KEYWORDS:
BOP-constrained growth; trade; debt; structural change; South America
Note: Venezuela has been excluded due to the unavailability of data as of 2016. The export value index is the average value of exports of goods and services in value for the nine South American countries considered with base 100 in 2010.Source: Authors’ elaboration based on data from CEPALSTAT, IMF, World Bank and own calculations.
Source: based on estimates included in ECLAC (2018).
Note: Estimates were made based on exports and world GDP at constant prices, expressed in logarithmic level, and taking data with annual frequency. Fixed effects were included by country. The share of medium and high technology exports in manufacturing exports corresponds to the simple average for the period 1993-2015.Source: Authors’ elaboration and own estimates based on data from ECLAC, the World Bank and the IMF.
Note: 2018 data were calculated from an ECLAC estimate of the gross foreign debt stock and an IMF estimate of GDP in current dollars.Source: Authors’ elaboration based on data from the ECLAC and IMF.
