The annual growth rate in 2022 should, according to the government, be limited to 1.6%.
Chile’s gross domestic product (GDP) rose 5.4% in the second quarter, down from the previous quarter, confirming a slowing economy, according to figures released Thursday by the Central Bank. After the record growth of 2021, when activity increased by 11.7%, supported by public aid to deal with the pandemic, the market was anticipating a rise of 5.7% between April and June. It was 7.4% in Q1.
In seasonally adjusted data, however, activity was nil in the second quarter. Between January and March, GDP contracted by 0.6% quarter-on-quarter, leading economists to estimate that the Chilean economy has already entered a phase of deceleration, close to entering a “technical recession”. .
“Technical recession”
“Seasonally adjusted GDP for the second quarter of 2022 showed no change from the first quarter, which puts it very close to a technical recession, a situation that should occur in the second half of the year,” explained to AFP Francisco Castañeda, economist at Mayor University. Same opinion for Jorge Selaive, chief economist of BBVA Research and professor at the University of Chile on his Twitter account: “It is confirmed that Chile is entering a technical recession”.
The annual growth rate in 2022 should, according to the government, be limited to 1.6% and will be compared with the exceptional year 2021, when nearly 90 billion dollars had been injected into the economy between direct aid from the State and several withdrawal authorizations in private pension funds. Another worrying factor is inflation. In July, the consumer price index (CPI) rose by 1.4%, bringing year-on-year inflation to 13.1%, a 28-year high.
Chilean exports in the second quarter fell (-0.3%), mainly affected “by the drop in copper shipments”, a metal of which Chile is the leading producer, with almost a third of the world supply. . The contribution of copper mining to the Chilean GDP is estimated between 10 and 15%.