A few days after the first sunrise of 2012 kissed the shores of Latin America, it is natural to ask: What does the New Year hold for the region’s economies, especially with Europe still under stress? For sure, a dimmer economic environment, here and abroad. Growth has softened in the larger countries of the region. Looking North, the United States is growing a bit more, but elsewhere activity is softening, including in China—an increasingly important customer for the region’s commodities. Perhaps more importantly, global financial markets are still strained, because many questions about advanced economies remain unanswered. What should countries do in the face of this risky outlook? A lot depends on their current macroeconomic situation.
Coming in to the 2011 Annual Meetings of the IMF and World Bank this past weekend, I had warned of the dangerous new phase for the global economy and had called for bold and collective action. Coming out of the Meetings, I feel strongly that the global community is beginning to respond. Why? Three reasons: a shared sense of urgency, a shared diagnosis of the problems, and a shared sense that the steps needed in the period ahead are now coming into focus. So, looking ahead, follow through—by all concerned—is now even more important. That means taking action not in the years ahead, but in the weeks ahead. And, in that, we are all in this together and we can only get out of it together.