ECLAC Warns of Worrying Rise in Basic Good Prices

Santiago de Chile, May 23 (Prensa Latina) The UN Economic Commission for Latin America and the Caribbean warned of the harmful impact on the region of the latest rise in prices for basic goods.

Such volatility is triggering uncertainty and represents an obstacle to investment and the sustained accumulation of technological and productive capacities in these countries, said ECLAC executive secretary Alicia Barcena.

In a lecture on the issue at a G20 minister-level workshop in Buenos Aires, Barcena referred particularly to the rise in prices of agricultural, mining and energy products, and said the magnitude of this phenomenon in every country depends on whether they are net exporters or importers country of these commodities.

She said that these price hikes generally tend to push inflationary pressure up, reduce food consumption by the poor and generate unsustainable imbalances in a country´s current accounts.

The likely effects of climate change also constitute another source of uncertainty that discourages investment, said Barcena.

The UN official recommended the implementation of policies to palliate the rise in prices in the sectors of commerce, production and macroeconomy.

Such practices would be oriented to prevent food shortage in importing countries, reduce vulnerability in consumption demand and preserve industrial competitiveness, promote employment and control inflation.

According to ECLAC, the rise in wheat and corn prices exceeded 90 and 60 percent, respectively, in June-December 2010, while prices for minerals and energy rose much more rapidly.

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