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South America far outstrips North in economic recovery
13/09/2010
Economists are exploring why the recent global recession appeared at its weakest in South America and the Caribbean.
The region managed to weather the global economic turmoil largely without the debt defaults, inflationary spirals, bank collapses, capital flight and currency devaluations it was known to suffer during previous worldwide crises.
Augusto de la Torre, the World Bank's chief economist for Latin America and the Caribbean, said institutional and policy reforms in large Latin American economies like Brazil have helped create an "economic immune system'' for the region.
The news came last week that 2010 will be a year of growth for the region, consolidating economic gains that began in mid-2009, to grow appproximately 5.2 per cent, according to the Economic Commission for Latin America and the Caribbean (CEPAL).
Experts attribute the stability to the sounder economic policies in place, the cleaned up public accounts and larger international reserves needed for purchases from abroad.
They have also benefited from China's need for their abundant natural commodities and raw materials, including timber, oil, natural gas, copper, soy beans, and iron ore.
The World Bank highlighted, however, that the continent has not escaped completely unscathed, with around 12 million people in the region thrust back into poverty and about one million made redundant. The fallout from the recession is expected to erode some of the gains made between 2002 and 2008 when 60 million left the ranks of the poor.
The region managed to weather the global economic turmoil largely without the debt defaults, inflationary spirals, bank collapses, capital flight and currency devaluations it was known to suffer during previous worldwide crises.
Augusto de la Torre, the World Bank's chief economist for Latin America and the Caribbean, said institutional and policy reforms in large Latin American economies like Brazil have helped create an "economic immune system'' for the region.
The news came last week that 2010 will be a year of growth for the region, consolidating economic gains that began in mid-2009, to grow appproximately 5.2 per cent, according to the Economic Commission for Latin America and the Caribbean (CEPAL).
Experts attribute the stability to the sounder economic policies in place, the cleaned up public accounts and larger international reserves needed for purchases from abroad.
They have also benefited from China's need for their abundant natural commodities and raw materials, including timber, oil, natural gas, copper, soy beans, and iron ore.
The World Bank highlighted, however, that the continent has not escaped completely unscathed, with around 12 million people in the region thrust back into poverty and about one million made redundant. The fallout from the recession is expected to erode some of the gains made between 2002 and 2008 when 60 million left the ranks of the poor.
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