Posts Tagged ‘financial system’

Latin American Governments

Monday, February 18th, 2013

Why has the crisis impeded the development of the Latin American financial system? Buenos Aires, February 2, 2009 the international financial crisis has taken to Latin America at a time of strong economic growth. Not only the Latin American countries were enjoying an historical period of growth, but also their Governments (at least in most of the countries of the region), were pursuing important reforms and boosting measures aimed at achieving the region’s economic development and sustained growth in the long term. One of the key sectors in which the reforms carried out by Latin American Governments focused was the financial system. The financial system in Latin America has been on several occasions the sector originating in the crises that the region was suffering. But in this new stage, Latin American financial systems are much more solid than in the past and with better prospects to underpin the growth of the economies of the region, transforming Thus in elements that increase the soundness of economies and not elements destabilizing as they used in the past. Linked to the above, an article recently published I was of great interest in the site by America Economia, written by Eduardo Thomson, who remembered the many reform initiatives in financial systems in Latin America that have been suspended because of the current international financial crisis which ended impacting on the region’s economies. So for example, in the case of Colombia, Thomson recalled important financial reform, which would introduce the possibility of that pension funds could offer multi-fund customers in such a way of adapting the supply of funds to the preference of customers against the risk. Thus, according to the level of risk the funds would have different exposure to the markets of fixed and variable income. While a multi-fund system implementation project has been put on hold, it is considered a fact fortunate part of Pedro Flecha, President of the Association of AFP from Peru, who indicated it as the cauda of the reduced impact of the crisis on the profitability of the pension funds in Colombia: by having a single fund with lower exposure to equities, accumulated a six and percentage of profitability.