International financial cooperation in the face of Latin America's economic crisis
May 8, 2020
This essay argues that the current global economic crisis will be remembered not only for being the worst since the Great Depression and one in which the domestic policies adopted by the developed countries were ambitious, but also by the limited multilateral financial cooperation agreed, in particular to support middle-income economies. The Latin American countries have benefited from the improvement in the IMF emergency credit lines, although with modest resources, and can access other credit facilities of that institution. Members of the Latin American Reserve Fund (FLAR) also have the possibility of accessing the resources of this regional body. The multilateral development banks have taken various important measures to support the countries of the region, but the programmed resources have so far been limited. The programmes announced by the Inter-American Development Bank and the Development Bank of Latin America (CAF) are important, but these banks are at the limit of their lending capacity and need to be capitalized. The World Bank has increased its credits to the region, but these are still lower than those that it financed during the previous crisis. The dynamic of the Central American Bank for Economic Integration stands out thanks to its recent capitalization.