Global market mayhem evokes mixed reaction in Latin America

October 8th, 2008 - 2:59 pm ICT by IANS  

Mexico City, Oct 8 (Xinhua) Latin American countries have reacted differently to the current world financial crisis with some governments urging more support from developed nations and some others taking active measures against it. Brazilian President Luiz Inacio Lula da Silva criticised the so-called “casino set in the US economy”, adding that the poorest countries cannot afford financial adventures.

The so-called casino economy is a system of investment in shares, securities, bonds and derivatives that earns money in the shape of interest, rather than in actual physical production that generates jobs.

Lula said that he had tried to discuss the crisis with G-8 countries twice, but they did not come up with any solution.

The president said that Brazil had prepared to cope with the crisis but rich countries were the one who should solve the problem.

Argentina’s Central Bank chief Martin Redrado ruled out the possibility that the country could suffer a similar economic crisis like the one at the end of 2001.

Redrado said that Argentina had “a hard and flexible currency and financial system. We are on course not only to keep the stability but to protect our economy in this change of context.”

Chilean Treasury Minister Andres Velasco said that Chile would address the current world financial crisis with “solidity and tranquility”.

“Chilean financial system is a solid conjunction, it is well regulated and well capitalised, but this does not mean that we should not pay attention, we must be very alert.”

The government has taken measures to face the global crisis and “the fundamentals of the Chilean economy allow us to be tranquil”, Velasco said.

“For years the rich countries and international financial centres taught lessons to Latin America on how to organise and modernise its markets and now we see those rich countries are on crisis for lack of regulations,” Chilean President Michelle Bachelet said.

The Shares Selective Price Index (IPSA) from Santiago, main index of the Santiago bourse, Tuesday registered a drop of 2.34 percent.

Venezuelan businessmen said Tuesday that they were concerned about the effects of the US financial crisis on Venezuelan economy.

“Venezuela will not be immune to the world crisis and our economy is not armoured for the effects of a global recession,” said Jose Manuel Gonzalez, president of the Fedecamaras Organisation which groups regional commerce and industry associations.

“Colombia will not have a recession and it will evade the international financial crisis,” Colombian Treasury Minister Oscar Zuluaga said.

Ecuadorian government said that it would seek resources and new export markets for such products like flower, cacao, banana and shrimp, which are affected by the US financial crunch.

Ecuadorian Agriculture Minister Walter Poveda said “the direct qualitative and quantitative effects of the US crisis is still not known, but this will not create a crisis in these sectors.”

Meanwhile, Particio Pena, president of the Stock Bourse of Quito, said that the US financial crisis would affect Ecuador, mainly on exports, remittances reception of the Ecuadorian immigrants and even employment.

Some 50 percent of the Ecuadorian exports go to US market, according to Pena.

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