Rethinking Bretton Woods | Fri, Dec 11, 2009
On September 2009, in Caracas, Venezuela, the Hemispheric Working Group on Trade-Finance Linkages, in cooperation with UNCTAD and Sistema Economico para Latinoamerica y el Caribe (SELA) held a regional consultation on the theme "Financial Crisis and Trade: Towards an Integrated Response in Latin America and the Caribbean." This is the third in a series of regional consultations that Center of Concern has been carrying out this year (previous consultations on the same topic were held this year with African and Asian governments).
The consultation relied on the generous support of the Ford Foundation and the Swedish Ministry for Foreign Affairs, as well as in kind contributions of SELA and UNCTAD. The meeting brought together near forty participants from governments, intergovernmental organizations, academics and civil society, including Ministers and senior officials from Latin American and Caribbean governments.
Goals of the meeting were to assess the role that trade structures and their linkages with finance have played in the unfolding of the crisis in Latin American/ Caribbean countries and ensure such assessment is included in the responses and to explore the practical applications that an integrated approach to trade and financial policies could have on improving specialised policy‐making on both the trade and the macroeconomic and financial fields, domestically and internationally.
In his opening words for the event, the head of SELA, Amb. Jose Rivera, after referring to the 6 years of uninterrupted high growth in the region that preceded the crisis, expressed concern that, “in contrast with the encouraging situation in our countries before the crisis, recent estimates point to a less than 2 percent average GDP growth for our region in 2009. Social impacts will be severe and the region will be poorer and more unequal.”
The concerns were certainly echoed in the Outcome Document adopted by the participants. This document is divided in six sections that correlate with the six areas addressed in the consultation (Financial and Exchange Rate volatility and Trade; Financial markets and specialization in international trade; The role of Aid for Trade in addressing trade disadvantages; The role of trade and investment in capital accumulation for development; Fiscal space for infrastructure, indebtedness and trade; Trade capacity and access to credit).
Among other recommendations, the document highlighted the potential of regional policies to face the crisis on the financial front, support development and reduce external vulnerability in the region; the need for the public sector to continue to play a fundamental role as supplier, investor and regulator in infrastructure investment projects and the urgency for developing countries to neutralize the impacts that third country markets and financial regulations play in prices of exported commodities via monetary, exchange rate and taxation tools.
Read more documentation and papers delivered at the consultation.