Latin America fights financial colds

Dan Grech Apr 4, 2008

TEXT OF STORY

Scott Jagow: As goes the U.S. economy, so goes the global economy. That’s been the prevailing wisdom for many years. This morning, investors around the world are waiting on the March jobs report for another reading on the U.S. economy.

But there are some people who believe Europe and Asia have decoupled from the U.S. And Latin America is trying. One of Latin America’s top banks, the IDB, has a big meeting in Miami today. From our America’s Desk at WLRN, Dan Grech reports.


Dan Grech: We’ve all heard the old saying: When the U.S. economy sneezes, Latin Americas catches a cold. But this time, many think the region has developed an immunity. High commodity prices and low interest rates have helped Latin America’s economy grow by 6 percent a year since 2002.

But economist Ernesto Talvi says Latin America may not be as healthy as it seems:

Ernesto Talvi: Taking the complacent attitude that we’re somehow immune to financial distress in international markets, it’s a little bit misplaced.

IDB economist Alejandro Izquierdo says prudent fiscal policy can help Latin America weather a U.S. downturn.

Alejandro Izquierdo: We need to be cautious in order to keep all the good things that we’ve been able to achieve.

The IDB will be sounding this cautionary note during its five-day annual meeting.

In Miami, I’m Dan Grech for Marketplace.

Marketplace is on a mission.

We believe Main Street matters as much as Wall Street, economic news is made relevant and real through human stories, and a touch of humor helps enliven topics you might typically find…well, dull.

Through the signature style that only Marketplace can deliver, we’re on a mission to raise the economic intelligence of the country—but we don’t do it alone. We count on listeners and readers like you to keep this public service free and accessible to all. Will you become a partner in our mission today?

Your donation is critical to the future of public service journalism. Support our work today – for as little as $5 – and help us keep making people smarter.