MercoPress. South Atlantic News Agency

South America better prepared for US recession challenge

Although the Latin American economy isn't “immune” to the crisis in the United States, it's in a better position than 10 years ago and Central America and the Caribbean will feel the effects more than South American countries, said World Bank vice president Pamela Cox this week in Bogota.

Interviewed by newspaper Portafolio yesterday, Cox said the region in the last five years continued with its good performance and is expected to grow an average of 4.5% this year. "We've been seeing that the region isn't completely immune to the crisis, but it's in a better position than 10 years ago in terms of current account, the handling of fiscal topics and the monitoring of its financial sector. Times are good." Nevertheless, Cox said countries that import raw materials, especially Central America and the Caribbean, "which buy part of their food and fuels abroad, are going to be hit." "These countries as well as Mexico traditionally have had strong links with the US in so far as markets, tourism and remittances. South America on the other hand has a more solid position since its dependency is less", she added. Nevertheless Cox said it was "depressing" to see how in the last hundred years the participation of the region in the global economy has fallen against Southeastern Asia and Eastern Europe and therefore it's vital to ensure annual growth above 4.5 and 5%. "The three great challenges ahead for Latinamerica are: one investment in education; second infrastructure since the region is lagging in this field and rapidly loosing competitiveness and thirdly, the great area of innovation and development" said the WB vicepresident. But she also praised the fall in poverty and indigence percentages in Brazil and Argentina as well as in inequality, "all of which is most encouraging".