ECLAC REVISES LATIN AMERICA, CARIBBEAN GROWTH DOWNWARD

San Salvador, August 29 (Reuters)- Latin America and the Caribbean will expand less than expected this year due to softening internal demand and weaker demand for exports, a United Nations agency said yesterday.

Alicia Barcena, head of the UN's Economic Commission for Latin America and the Caribbean (ECLAC), said the body now sees regional growth of 3.2 percent to 3.3 percent this year, down from the previous forecast of 3.7 percent, confirmed in June.

The revision marks a steeper slowdown from the 4.3 percent growth the region achieved in 2011, amid worries about the euro zone debt crisis and a slowdown in China, a major trade partner for many Latin American countries.

"We have reduced (the forecast) a bit, especially because there has been a very marked deceleration most of all in internal demand, of demand in general in Europe and in the United States," Barcena told Reuters on the sidelines of ECLAC's biennial meetings.

"This has meant that trade figures have decreased and that tells us that the deceleration will be a bit stronger”.

Brazil, Latin America's biggest economy, would not reach the 2.7 percent growth ECLAC had forecast for this year, Barcena said, without giving a specific number.

Data due on Friday is expected to show Brazil's economy struggled to gain momentum in the second quarter despite massive government stimulus and better farming conditions. Economists in a Reuters poll tipped year-on-year growth of 0.7 percent.

ECLAC also saw lower-than-expected growth in Argentina at 2.5 percent this year, Barcena said, down from the previous forecast of 3.5 percent.

But in Mexico, the region's number two economy, growth could even exceed the 4 percent ECLAC forecasts due to a brighter outlook in the United States, its main trading partner.

<