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Latin America, Caribbean face sharp economic slowdown, UN agency warns

SANTIAGO, June 6 (Xinhua) -- Latin America and the Caribbean face a sharp economic slowdown, rising inflation, and a slow and incomplete recovery of labor markets, leading to increases in levels of poverty and extreme poverty, the Economic Commission for Latin America and the Caribbean (ECLAC) warned on Monday.

The United Nations agency presented a report at its regional headquarters in Chile's capital Santiago on Monday, showing that 7.8 million more people are likely to join the 86.4 million whose food security is already at risk.

The acting executive secretary of ECLAC, Mario Cimoli, said at a press conference that the current situation should not be seen as an isolated phenomenon, but as a part of setbacks caused by more than a decade of accumulated crises.

Progress in vaccination against COVID-19, the easing of pandemic lockdown restrictions and the reopening of schools will promote a recovery in levels of workforce participation, especially of women, the hardest-hit segment, since women left the labor force in greater numbers during the pandemic, said Cimoli.

However, the combined effect of greater labor participation and lower economic growth, and therefore lower job creation, would lead to a rise in the unemployment rate in 2022, he noted.

According to the report, following the economic expansion seen in 2021 (6.3 percent growth in regional gross domestic product), the region will see an average annual growth of 1.8 percent in 2022, as ECLAC previously reported on April 27.

The region will see a return to the slow growth pattern seen from 2014 to 2019, of "just 0.3 percent annual growth on average, with the resulting decline in GDP per inhabitant," said ECLAC.