International Comparison Program: 2021 cycle in Latin America and the Caribbean. Methodological document and main results

Comparison of economies is essential for public policymaking but considerably hindered by the fact that statistics expressed in local currencies are not directly comparable. Market exchange rates give a distorted view, as they do not reflect the differences in price levels between countries. To overcome this challenge, the International Comparison Program (ICP), coordinated by the World Bank, produces purchasing power parities (PPP). These indicators eliminate price differences, allowing for comparison of real GDP volumes and calculation of the real size of economies. Thirty-six economies of Latin America and the Caribbean participated in the 2021 cycle of ICP under the coordination of ECLAC and OECD, overcoming the challenges of the pandemic to provide quality data. The results confirm PPP as crucial to the measurement of the real economy and material well-being. Thus, ICP has proved to be a strategic instrument for guiding public policies, fostering international cooperation and supporting achievement of the Sustainable Development Goals.