John Nash

Augusto de la Torre

Emily Sinnott

"The question of how to treat commodity production and how to manage recurrent cycles of booms and busts has always been a challenge for policymakers in commodity-dependent countries, including many in the LAC region. These challenges have led to allegations of a "commodity curse'' that retards development in these countries, but as of yet, there is no consensus as to whether such a curse exists, and if so, how can negative effects be minimized. This book contributes to this debate. Much of the report is focused on an examination of specific channels through which commodity dependence may affect the economic and institutional development of countries. This includes broadly 4 sets of concerns: one set dealing with the direct economic effects of commodity dependence and the implications for long-term growth; one dealing with the interactions between commodity production and the rents it generates on the one hand, and a country's institutions on the other; a third dealing with the macroeconomic challenges of managing the volatility of revenue flows, including the distributional implications at the household level posed by cyclicality of social spending; and a final set associated with potential negative environmental and social impacts. The book finds that some commonly accepted negative effects of dependence on natural resources are largely myths, while some are realities. But all can be managed, and the book draws on the best available information in existing literature as well as original analysis to provide practical advice on how to do so. It also presents descriptive facts and analysis of the impacts in LAC of the recent commodity boom, helping the reader understand the implications for the region's development and policies. It should be of great interest to policy-makers and analysts, as well as laypersons interested in the economics of commodity markets and their role in economic development."

Beyond Booms and Busts?

Natural Resources in Latin America and the Caribbean

Samuel Pienknagura

Eduardo Levy Yeyati

This semiannual report examines the short and medium-term challenges for Latin America and the Caribbean (LAC) as the external factors that were instrumental in the region s recent performance recede. In particular, we address the role of the exchange rate as a counter-cyclical policy tool to buffer adverse external shocks.

Latin America s Deceleration and the Exchange Rate Buffer

LAC Semiannual Report, October 2013

Guillermo Beylis

Tatiana Didier

Carlos Rodriguez Castelan

Sergio Schmukler

As usual in this series, Chapter 1 reviews the configuration of global risks and assesses the outstanding short term opportunities and challenges facing the LAC region. We document the significant slowdown in economic activity across the region, and explore the possibility of this being the ‘new normal’. In Chapter 2 we assess if the major social gains achieved during the ‘Golden Decade’, in particular the decline in inequality, will hold in this less supportive environment, and discuss alternative policy responses to preserve and further the equity gains in the region.

Inequality in a Lower Growth Latin America

LAC Semiannual Report October 2014

This semiannual report — a product of the Office of the Chief Economist for Latin America and the Caribbean Region of the World Bank — examines the short and medium-term challenges for Latin America and the Caribbean (LAC) as the external factors that were instrumental in the region’s recent performance recede. Chapter 1 gives an overview of the global economy and its implications for the short- and medium-term prospects of the LAC region. Chapter 2 provides a detailed analysis of the general patterns of domestic demand and supply observed in LAC over the last decade. In particular we document the steady increase in LAC’s domestic demand, especially its investment component, as a share of GDP over the 2000s. Moreover, we show that the rise of domestic demand has occurred in tandem with an expansion of the services sector. We assess what are the pitfalls and challenges for LAC’s growth pattern in a less benign global environment.

In Search of Higher Growth (LAC Semiannual Report, April 2013)

Latin America and the Caribbean as Tailwinds Recede

Este informe semestral, producido por la Oficina del Economista Jefe para América Latina y el Caribe del Banco Mundial, examina los retos a los que América Latina y el Caribe (LAC por sus siglas en inglés, Latin America and the Caribbean) se enfrentan en el corto y medio plazo conforme pierden fuerza los factores externos que resultaron decisivos para el desempeño reciente. En concreto, el informe analiza el papel del tipo de cambio como herramienta contra-cíclica para amortiguar los choques externos negativos. Como es costumbre en esta serie, el Capítulo 1 repasa el estado de la economía mundial y sus implicaciones para las perspectivas de corto y medio plazo de LAC. Además, examina las vulnerabilidades de la región en un periodo en que los vientos favorables están amainando. El Capítulo 2 describe el nuevo papel del tipo de cambio en LAC como amortiguador de choques en el marco de las transformaciones importantes que la región ha realizado en el frente macrofinanciero durante la última década. Finalmente, el Capítulo 3 analiza pormenorizadamente las políticas de intervención para suavizar el tipo de cambio.

La desaceleración en América Latina y el tipo de cambio como amortiguador

LAC Informe Semestral, Octubre 2013

Alain Ize

Sergio L. Schmukler

During the 1980s and 1990s, financial sectors were the Achilles heel of economic development in Latin America and the Caribbean (LAC). Since then, these sectors have grown and deepened, becoming more integrated and competitive, with new actors, markets, and instruments springing up and financial inclusion broadening. To crown these achievements, the region s financial systems were left largely unscathed by the global financial crisis of 2008 09. Now that the successes of LAC s macrofinancial stability are widely recognized and tested, it is high time for an in-depth stocktaking of what remains to be done. Financial Development in Latin America and the Caribbean: The Road Ahead provides both a stocktaking and a forward-looking assessment of the region s financial development. Rather than going into detail about sector-specific issues, the report focuses on the main architectural issues, overall perspectives, and interconnections. The report s value added thus hinges on its holistic view of the development process, its broad coverage of the financial services industry beyond banking, its emphasis on benchmarking, its systemic perspective, and its explicit effort to incorporate the lessons from the recent global financial crisis. Financial Development in Latin America and the Caribbean: The Road Ahead builds on and complements several overview studies on financial development in both LAC countries and the developing world that were published in the past decade. It will be of interest to policy makers and financial analysts interested in improving the financial sector in the LAC region.

The Road Ahead

Financial Development in Latin America and the Caribbean

Pablo Fajnzylber

There is an increasing consensus in the scientific community that climate change is a real and present threat. Despite the large uncertainty on the timing, magnitude and even the direction of some of the physical and economic effects of this phenomenon, it is widely accepted that the differences are regional and that developing countries as well as lower income populations tend to suffer the most. In this context, it is critical for Latin American countries to develop strategies for adapting to the various impacts of climate change, and for contributing to global efforts aimed at mitigation. Climate Change in Latin America contributes to these efforts by addressing a number of questions related to the causes and consequences of climate change in the case of Latin America. What are the likely impacts of climate change in the region? Which countries and regions will be most affected? What can governments do to tackle the challenges associated with adapting to climate change? What role can Latin America play in the area of climate change mitigation? While the book does not attempt to provide definitive answers to these questions, it contributs new information and analysis that could help to inform the public policy debate on this important issue.

Augusto de la Torre

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