Latin America | IMF Blog

Corruption in Latin America: Taking Stock

By David Lipton, Alejandro Werner, Carlos Gonçalves

September 21, 2017

Versions in Español (Spanish) Português (Portuguese)

Systemic corruption drains public resources and drags down economic growth (photo: People Images/iStock).

Corruption continues to make headlines in Latin America. From a scheme to shelter assets leaked by documents in Panama, to the Petrobras and Odebrecht scandals that have spread beyond Brazil, to eight former Mexican state governors facing charges or being convicted, the region has seen its share of economic and political fallout from corruption. Latin Americans are showing increasing signs of discontent and demanding that their governments tackle corruption more aggressively.

Continue reading “Corruption in Latin America: Taking Stock” »

By IMFBlog| September 21st, 2017|capital markets, commodities, Corporate Risk, corruption, developing countries, Economic outlook, Economic research, Emerging Markets, Global Governance, Government, inclusive growth, International Monetary Fund, Investment, Latin America, Politics|

Stepping up the Fight Against Money Laundering and Terrorist Financing

By Christine Lagarde

July 26, 2017

Versions in ربي (Arabic), 中文 (Chinese), Français (French), Русский (Russian), and Español (Spanish)

Money laundering and terrorist financing threaten economic stability. International cooperation is vital in the fight against misuse of the financial system (photo: CraigRJD/iStock by Getty Images)

Corrupt officials, tax cheats, and the financial backers of terrorism have one thing in common: they often exploit vulnerabilities in financial systems to facilitate their crimes.

Money laundering and terrorist financing can threaten a country’s economic and financial stability while funding violent and illegal acts. That is why many governments have stepped up the fight against such practices, helped by international institutions such as the IMF.

Continue reading “Stepping up the Fight Against Money Laundering and Terrorist Financing” »

By IMFBlog| July 26th, 2017|banking, correspondent banking, corruption, developing countries, Emerging Markets, Finance, Financial markets, financial policy, Financial regulation, Financing, Government, IMF, International Monetary Fund, Investment, Latin America, Low-income countries, Politics, Reform, taxation|

Latest Outlook for The Americas: Back on Cruise Control, But Stuck in Low Gear

By Alejandro Werner

July 25, 2017

Versions in Español (Spanish), Português (Portuguese)

Shopping mall in Viña del Mar, Chile: Latin America is expected to recover gradually as most economies continue to face weak domestic demand (photo: Rodrigo Garrido/Newscom)

After disappointing growth over the past few years, economic activity in Latin America remains on track to recover gradually in 2017–18 as recessions in a few countries—notably Argentina and Brazil—are coming to an end. Our latest projections show the region growing by 1 percent in 2017 and 1.9 percent in 2018.

But amid low confidence, domestic demand continues to remain weak across most economies, and is expected to only recover slowly as actual output catches up to potential and internal sources of growth build strength, based on a decline in political and policy uncertainty across some major economies. Some countries in the region will need clear strategies to adjust further following a permanent loss in commodity revenues. Continue reading “Latest Outlook for The Americas: Back on Cruise Control, But Stuck in Low Gear” »

By IMFBlog| July 25th, 2017|capital flows, capital markets, Caribbean, commodities, Economic outlook, Economic research, education, Employment, Global Governance, Government, growth, inclusive growth, income, infrastructure, International Monetary Fund, labor markets, Latin America, Politics, productivity, structural reforms|

Migration and Remittances in Latin America and the Caribbean: Brain Drain Versus Economic Stabilization

By Svetlana Cerovic and Kimberly Beaton

June 29, 2017

Versions in Español (Spanish) and Português (Portuguese)

People waiting to withdraw money in La Cruz, Costa Rica: emigrants from Latin America send home sizable remittances (photo: Juan Carlos Ulate/Reuters/Newscom)

Many people from Latin America and the Caribbean live and work abroad. Migrants have been motivated to leave their home country in search of better job opportunities and, in some cases, a more secure environment. Their families at home often benefit from the remittances migrants send home, which help improve their standard of living, health care, and education. Remittances also provide financial resources for trade and investment, which helps boost the country’s growth. Continue reading “Migration and Remittances in Latin America and the Caribbean: Brain Drain Versus Economic Stabilization” »

By IMFBlog| June 29th, 2017|banking, capital flows, Caribbean, developing countries, Economic outlook, Economic research, Employment, growth, International Monetary Fund, Investment, labor force, Latin America, Migration, trade, U.S.|

Chart of the Week: Why Energy Prices Matter

By IMFBlog

June 5, 2017

Versions in عربي (Arabic), 中文 (Chinese), Español (Spanish)

(photo: Imagine China/Newscom)

Wind turbines and solar panels generate electricity at power station, Jiangsu, China. Getting energy prices right will help reduce environmental costs and save lives (photo: Imagine China/Newscom)

World Environment Day is an occasion to consider why it’s so important to get energy prices right. The IMF has long argued that energy prices that reflect environmental costs can help governments achieve their goals not only for improving public health but also for inclusive growth and sound public finances.

A number of countries such as Egypt, Indonesia, Mexico, and Saudi Arabia have recently taken important steps to increase energy prices towards market levels. Some others, such as India and China have made important strides in cost-effective renewable energy sources—and reduced their reliance on fossil fuels. Still, undercharging for fossil fuel energy remains pervasive and substantial and can cause severe health effects from pollution, particularly in densely populated countries. Continue reading “Chart of the Week: Why Energy Prices Matter” »

By IMFBlog| June 5th, 2017|Advanced Economies, Environment, Fiscal policy, growth, health, IMF, infrastructure, Investment, technology, Uncategorized|

How Flexible Exchange Rates Helped Latin America Adjust to Commodity Price Shocks

By Yan Carrière-Swallow, Nicolás Magud, and Juan Yépez

May 25, 2017

Versions in Português (Portuguese), and Español (Spanish)

(photo: Ivan Alvarado/Reuters/Newscom)

As world prices for Latin America’s key exports—oil, metal, and agricultural products—fell from their super-cycle peak in 2011 and demand from trading partners weakened, export revenues have dropped sharply. Across most of South America, export revenues have fallen by one-third, and by more than half in the case of Venezuela. The size of these shocks has been historic in some cases, ranking among the largest trade price busts faced by emerging economies around the world since 1960. Continue reading “How Flexible Exchange Rates Helped Latin America Adjust to Commodity Price Shocks” »

By IMFBlog| May 25th, 2017|banking, currency, developing countries, Emerging Markets, exchange rates, exports, Financial markets, Latin America, South America|

Navigating Through Global Cross Currents: Latest Outlook for Latin America and the Caribbean

Event only By Alejandro Werner

Versions in Português (Portuguese), and Español (Spanish)

The global landscape has changed since our last update in October 2016. These changes have been mainly shaped by:

An anticipated shift in the U.S. policy mix, higher growth and inflation, and a stronger dollar. In the United States—while potential policy changes remain uncertain—fiscal policy is likely to become expansionary, while monetary policy is expected to tighten faster than previously expected because of stronger demand and inflation pressures. As a result, growth is projected to rise to 2.3 percent in 2017 and 2.5 percent in 2018—a cumulative increase in GDP of ½ percentage point relative to the October forecast. The expected change in the policy mix and growth has led to an increase in global long-term interest rates, a stronger dollar in real effective terms, and a moderation of capital flows to Latin America.

Improved outlook for other advanced economies and China for 2017–18, reflecting somewhat stronger activity in the second half of 2016 as well as projected policy stimulus.
Some recovery in commodity prices, especially metal and oil prices, on the back of strong infrastructure and real estate investment in China, expectations of fiscal easing in the United States, and agreement among major petroleum producers to cut supply.

Continue reading “Navigating Through Global Cross Currents: Latest Outlook for Latin America and the Caribbean” »

By IMFBlog| January 23rd, 2017|Economic outlook, growth, IMF, International Monetary Fund, structural reforms|

What the Fed Rate Rise Means for Corporate Debt in Emerging Markets

By Adrian Alter and Selim Elekdag

Versions in عربي (Arabic), and Español (Spanish)

In December 2016, the U.S. Fed raised interest rates for the first time in a year, and said they planned more increases in 2017. Emerging market currencies took a bit of a dive, but overall investors didn’t overreact and run for the doors with their money. For the bigger picture, you can read IMF Chief Economist Maurice Obstfeld’s blog that outlines how the U.S. election and Fed decision will impact the global economy. Continue reading “What the Fed Rate Rise Means for Corporate Debt in Emerging Markets” »

By IMFBlog| January 9th, 2017|Emerging Markets, International Monetary Fund, monetary policy|

Redesigning Argentina’s Economic Landscape

By Roberto Cardarelli

Versions in Português (Portuguese), and Español (Spanish)

Most people know Argentina as the land of tango, Malbec, and some of the greatest soccer players of all times. But Argentina is also famous for being home to some of the most diverse and extreme landscapes of the world—from subtropical rainforests and Iguazu Falls in the north to the glaciers of Perito Moreno in the south, and from the lowest site in South America (Laguna del Carbón) to the highest elevation in the Americas (Aconcagua mountain).

Continue reading “Redesigning Argentina’s Economic Landscape” »

By IMFBlog| November 21st, 2016|Economic research, Fiscal policy, Government, growth, inflation, International Monetary Fund, Reform|

Addition by Subtraction: How Diasporas Can Boost Home-Country Growth

By Pritha Mitra

Version in عربي (Arabic)

Every year, millions of people leave their countries of birth in search of better opportunities abroad. Often, these migrants are among the most talented workers in their home countries. At first glance, this is a loss for the home countries, which invested considerable time and money in educating and developing these people, only to watch them leave. But look again.

Continue reading “Addition by Subtraction: How Diasporas Can Boost Home-Country Growth” »

By IMFBlog| May 18th, 2016|Emerging Markets, Employment, Government, growth, International Monetary Fund, Investment, Migration, technology, Uncategorized|

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