Weekly Report - 2 March 2004

COLOMBIA | Best results since '97. Final GDP figures for 2003 show a growth rate of 3.64%, the highest in six years and 1.64 points above what the government had projected. The national statistical institute, Dane, noted that if illegal (drug) crops are excluded from the calculation, the growth rate rises to 3.96%. The figures are encouraging after two years of growth rates below 2%. However, President Alvaro Uribe has been saying that Colombia needs higher rates of growth to reduce unemployment and pull people out of poverty. This is aimed at the ultra-cautious central bank, which until 20 February had held its `intervention' rate unchanged for 10 consecutive months.

BOLIVIA | Gas leads export expansion. After decades of export earnings stuck at about US$1.2bn a year, in 2003 Bolivia saw them increase to a record US$1.57bn. The biggest boost came from exports of natural gas, which expanded by 43%, to US$381m (despite Brazil taking much less than had been expected). This has made gas the premier export product, overtaking soya, which last year brought in US$336.5m (up 7.6%). Third came zinc, with US$123m (barely above the previous year). At a lower level, another item to experience rapid expansion in 2003 was fuels, which earned US$95.4m (up 46%).

PERU | Last IMF test cleared. Last week the IMF announced that Peru had passed the fourth and last performance review under its 2-year US$380m standby agreement (which has not been drawn upon). Deputy managing director Agustí­n Carstens, amid fulsome praise for Peru's achievements, suggested that `work should continue to broaden the consensus for the elimination of regional and sectoral tax exemptions, and the impact of the financial transaction tax will need to be monitored closely.' Among the aspects of Peru's strategy singled out for praise was the government's effort to `de-dollarise' the economy.