MEDELLIN, Colombia, March 28 (Reuters) - Latin America faces probably its 'worst shock' ever in the global credit crisis, but is better positioned to recover than in past economic meltdowns because of improved fiscal preparation, a top IMF official said on Saturday.
The region will slump into negative growth this year, but its recovery depends heavily on industrialized nations unclogging capital, fixing their banks and adequately maintaining stimulus for growth, said Nicolas Eyzaguirre, director for the IMF's Western Hemisphere Department.
'This is probably the worst shock faced by the region ever ... but this time around the level of preparedness is much better,' Eyzaguirre told reporters on the sidelines of the Inter-American Development Bank meeting in Medellin, Colombia.
The crisis is eroding economic advances made by the region after prices on their commodity exports rose over the past several years, and threatens to increase its ranks of poor by 6 million people, according to World Bank estimates.
The global financial credit crunch has slowed demand for exports from Latin America and crimped prices on their vital commodities from oil to copper. The World Bank has said recovery in Latin America and the Caribbean could take as long as the second quarter of next year.
Eyzaguirre said ensuring that recovery by 2010 would depend on industrialized countries maintaining proactive monetary policies, repairing their banks and keeping stimulus measures in place for the time required.
((Reporting by Patrick Markey in Medellin; Editing by Peter Cooney) Keywords: FINANCIAL/LATINAMERICA IMF (e-mail: pat.markey@thomsonreuters.com; +571-634-4139; Reuters Messaging: pat.market.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
The region will slump into negative growth this year, but its recovery depends heavily on industrialized nations unclogging capital, fixing their banks and adequately maintaining stimulus for growth, said Nicolas Eyzaguirre, director for the IMF's Western Hemisphere Department.
'This is probably the worst shock faced by the region ever ... but this time around the level of preparedness is much better,' Eyzaguirre told reporters on the sidelines of the Inter-American Development Bank meeting in Medellin, Colombia.
The crisis is eroding economic advances made by the region after prices on their commodity exports rose over the past several years, and threatens to increase its ranks of poor by 6 million people, according to World Bank estimates.
The global financial credit crunch has slowed demand for exports from Latin America and crimped prices on their vital commodities from oil to copper. The World Bank has said recovery in Latin America and the Caribbean could take as long as the second quarter of next year.
Eyzaguirre said ensuring that recovery by 2010 would depend on industrialized countries maintaining proactive monetary policies, repairing their banks and keeping stimulus measures in place for the time required.
((Reporting by Patrick Markey in Medellin; Editing by Peter Cooney) Keywords: FINANCIAL/LATINAMERICA IMF (e-mail: pat.markey@thomsonreuters.com; +571-634-4139; Reuters Messaging: pat.market.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.