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941. Financial Integration and Foreign Banks in Latin America: Do They Amplify External Financial Shocks?

Author:
Liliana Rojas-Suarez, Arturo J. Galindo, and Alejandro Izquierdo
Publication Date:
02-2010
Content Type:
Working Paper
Institution:
Center for Global Development (CGD)
Abstract:
This paper explores the impact of international financial integration on credit markets in Latin America. Using a cross-country dataset covering 17 Latin American countries between 1996 and 2008, the authors find that financial integration amplifies the impact of international financial shocks on aggregate credit and interestrate fluctuations. Despite this pernicious effect, the net impact of integration on deepening credit markets is positive and dominates for the large majority of states of nature. The paper also uses a detailed bank-level dataset covering more than 500 banks in Latin America for a similar time period to explore the role of financial integration—captured through the participation of foreign banks—in propagating external shocks. The authors find that interest rates charged and loans supplied by foreign-owned banks respond more to external financial shocks than those supplied by domestically owned banks. However, this result does not hold for all foreign banks: Spanish banks in the sample behave more like domestic banks and do not amplify the impact of foreign shocks on credit and interest rates. Important policy recommendations to avoid foreign banks' amplification of external financial shocks include the establishment of ring-fencing mechanisms, the development of early-warning systems, and the incorporation for agreements between domestic and foreign supervisors.
Topic:
Economics and Markets
Political Geography:
Latin America and Spain

942. The International Financial Crisis: Eight Lessons for and from Latin America

Author:
Liliana Rojas-Suarez
Publication Date:
01-2010
Content Type:
Working Paper
Institution:
Center for Global Development (CGD)
Abstract:
The international financial crisis of 2008–09 exposed the strengths and weaknesses of the current paradigm of development in Latin America, a paradigm based on liberalized capital accounts and significantly improved macroeconomic conditions. This paper presents lessons derived from the crisis, not only for the region itself, but also for other developing countries that might seek economic growth in the context of greater integration to the international capital markets. Some of the lessons are not new but have been reinforced by the crisis, such as Latin America's imperative need for export diversification (not only in products but in partners). Other lessons break with longstanding myths about the region, such as its inability to undertake counter-cyclical policies—at least on the monetary side. Yet other lessons reflect new developments in the current growth paradigm, such as a renewed assessment of (1) the relative roles of foreign and domestic banks in shielding the financial system against external shocks and (2) the potential costs of adopting blanket international financial regulations that do not account for a country's degree of development. Taken together, the lessons in this paper bring a new sense of optimism for growth in Latin America.
Topic:
Economics, International Trade and Finance, and Financial Crisis
Political Geography:
Latin America

943. Chile\'s outward FDI and its policy context

Author:
Carlos Razo and Álvaro Calderón
Publication Date:
03-2010
Content Type:
Working Paper
Institution:
Columbia Center on Sustainable Investment
Abstract:
Despite the recent financial and economic crisis, Chile\'s outward foreign direct investment (OFDI) in 2009 surpassed the record level of 2008, reflecting the strength of Chilean firms and the country\'s continuous commitment to integrate into the world economy. Two decades ago, Chile was an unlikely foreign direct investor. Today, even with no explicit policies to promote outward investment or the creation of national champions, Chile stands out as the third biggest investor of Latin America in absolute terms and as the first one in proportion to its GDP, even outperforming other emerging economies of similar size in other regions of the world.
Topic:
Foreign Direct Investment and Financial Crisis
Political Geography:
Latin America and Chile

944. Child Budget Initiatives in Latin America

Author:
Alberto Minujin, Louise Moreira Daniels, and Javier Curcio
Publication Date:
01-2010
Content Type:
Working Paper
Institution:
The New School Graduate Program in International Affairs
Abstract:
Children in Latin American (LA) countries were among the most vulnerable groups that suffered from the adjustment policies promoted by the “Washington Consensus” in the 1980s and 1990s. In that context, several organizations started initiatives to ensure and promote resources allocated by public budgets to children and women. This paper describes and analyzes the characteristics and main activities of such initiatives in a dozen LA countries, with in-depth analysis provided for three countries: Argentina, Brazil and Ecuador. A number of lessons are enumerated, which can serve as orientation for other regions, in particular for Africa.
Topic:
Development and Labor Issues
Political Geography:
Africa, Washington, Brazil, Argentina, Latin America, and Ecuador

945. The Obama Administration and Latin America: Towards a New Partnership?

Author:
Daniel P. Erikson
Publication Date:
04-2010
Content Type:
Working Paper
Institution:
Centre for International Governance Innovation (CIGI)
Abstract:
The presidency of Barack Obama ushered in a welcome honeymoon period in US-Latin American relations following eight years of the Bush administration's polarizing policies towards the region. Early optimism has been tempered by the reappearance of tensions in hemispheric relations. They include the rise of Brazil as a regional power, the role of Venezuela and the continued strain in US-Cuban relations. Regional relations are further complicated by China's growing economic presence in Latin America, increased ties with Iran and Russia, different US and Latin reactions to the June 2009 coup in Honduras, and the crisis response to the January 2010 earthquake in Haiti. Still, the US has potential to advance a strategy of substantive, issue oriented engagement designed to rekindle the early goodwill that resulted from Obama's election to the White House.
Topic:
International Relations and Diplomacy
Political Geography:
Russia, United States, China, Latin America, and Haiti

946. Earthquake Olympics

Author:
John Feffer
Publication Date:
04-2010
Content Type:
Policy Brief
Institution:
Foreign Policy In Focus
Abstract:
The survivors of the devastating earthquakes in Haiti and Chile are still scrambling to deal with the damage. Here, however, pundits are still scrambling to explain the dramatic difference in impact. Haiti's quake on January 12 came in at 7.0 on the Richter scale, leveled the capital city, and left more than 200,000 dead. Chile's earthquake on February 27 registered a magnitude of 8.8, which means it was 500 times more powerful than the Haiti shock. But fewer than 1,000 Chileans died, and the damage to buildings was considerably less.
Topic:
Humanitarian Aid and Natural Disasters
Political Geography:
Latin America

947. Domestic sources of Japanese foreign policy activism: loss avoidance and demand coherence

Author:
Mireya Solís and Saori N. Katada
Publication Date:
01-2010
Content Type:
Journal Article
Journal:
International Relations of the Asia-Pacific
Institution:
Japan Association of International Relations
Abstract:
The conventional view in the field of international political economy – that greater economic interdependence creates an incentive for active foreign policy engagement – is hard to reconcile with Japan's foreign economic policy. To explain this counterintuitive outcome, we develop a new model of domestic demand for policy activism that integrates strands of prospect theory, collective action, and interest aggregation. We argue that both the rationale for mobilization and lobbying capacity are essential elements in understanding the domestic demand for significant foreign policy departures. We apply this conceptual framework to Japanese foreign economic policy in two issue areas: finance (Japan's response to the 1980s Latin American debt crisis and the late 1990s Asian Financial Crisis), and trade (Japan's Free Trade Agreement negotiations with Mexico and South Korea).
Political Geography:
Japan, Asia, South Korea, Latin America, and Mexico

948. Hydrocarbons in the Amazon: Awakening Old Inequalities

Author:
Patricia Vasquez
Publication Date:
04-2010
Content Type:
Policy Brief
Institution:
United States Institute of Peace
Abstract:
Private oil companies invested $800 million in Peru in 2009 alone, and another $1 billion is planned for investments in natural gas developments between 2010-20131, as Peru is rapidly on its way to becoming Latin America's first exporter of liquefied natural gas (LNG).
Topic:
Emerging Markets, Energy Policy, Social Stratification, and Natural Resources
Political Geography:
South America, Latin America, and Peru

949. Billions More for International Institutions? The ABCs of the General Capital Increases (GCI)

Author:
Todd Moss, Sarah Jane Staats, and Julia Barmeier
Publication Date:
06-2010
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
The international financial institutions dramatically increased their lending in 2008–09 to help developing countries cope with the global financial crisis and support economic recovery. Today, these organizations are seeking billions of dollars in new funding. The IMF, which only a few years ago was losing clients and shedding staff, expanded by $750 billion last year. The World Bank and the four regional development banks for Africa, Asia, Europe, and Latin America are asking to increase their capital base by 30 to 200 percent. A general capital increase (GCI) for these development banks is an unusual request. A simultaneous GCI request is a once-in-a-generation occurrence.
Topic:
International Relations, International Monetary Fund, Financial Crisis, and World Bank
Political Geography:
Africa, Europe, Asia, and Latin America

950. The Washington Consensus: Assessing a Damaged Brand

Author:
Nancy Birdsall, Augusto de la Torre, and Felipe Valencia Caicedo
Publication Date:
05-2010
Content Type:
Working Paper
Institution:
Center for Global Development (CGD)
Abstract:
In this paper we analyze the Washington Consensus, which at its original formulation reflected views not only from Washington but also from Latin America. We trace the life of the Consensus from a Latin American perspective in terms of evolving economic development paradigms. We document the extensive implementation of Consensus-style reforms in the region as well as the mismatch between reformers' expectations and actual outcomes, in terms of growth, poverty reduction, and inequality. We then present an assessment of what went wrong with the Washington Consensus-style reform agenda, using a taxonomy of views that put the blame, alternatively, on (i) shortfalls in the implementation of reforms combined with impatience regarding their expected effects; (ii) fundamental flaws—in either the design, sequencing, or basic premises of the reform agenda; and (iii) incompleteness of the agenda that left out crucial reform needs, such as volatility, technological innovation, institutional change and inequality.
Topic:
Economics
Political Geography:
Washington and Latin America

951. Conflict and cooperation in local water governance–Inventory of local water-related events in Tiraque District, Bolivia

Author:
Vladimir Cossio, Rocío Bustamante, and Thomas Skielboe
Publication Date:
06-2010
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
Recent years have witnessed an increasing focus on water as a source of conflict. So far, much of the focus has been on the risk for transboundary water conflicts. Our current knowledge on local water conflicts is however more limited, and tends to be based on sporadic accounts of local water conflicts rather than on systematic empirical evidence. At the same time, the extent and nature of local water cooperation is often overlooked, just as we know little about the particular role of the poorest in water conflict and cooperation.
Topic:
Conflict Resolution, Regional Cooperation, and Natural Resources
Political Geography:
Latin America

952. Cooperación y Conflicto en torno a la Gestión Local del Agua en el municipio de Condega, Nicaragua

Author:
Helle Munk Ravnborg, Roberto Rivas Hermann, Tania Paz Mena, and Ligia Gómez
Publication Date:
06-2010
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
La investigación internacional “Competencia por el agua: Entendiendo el Conflicto y la Cooperación en torno a la Gestión Local del Agua” llevaba a cabo en los países de Bolivia, Mali, Vietnam, Zambia y Nicaragua, tiene como objetivo principal “Contribuir a la gestión local sostenible del agua, en beneficio de los pobres rurales y otros grupos en desventaja en los países en desarrollo, a través de un mayor conocimiento de la extensión y la intensidad de los conflictos y la cooperación local por el agua”. Como resultado de la investigación se pretende la elaboración de recomendaciones de políticas internacionales, nacionales y locales para la mejora en la gestión del agua para lo cual se realizan diferentes esfuerzos investigativos en el tema como el caso del presente documento.
Topic:
Conflict Resolution and Natural Resources
Political Geography:
Latin America

953. Cocaine and Instability in Africa: Lessons from Latin America and the Caribbean

Author:
Davin O'Regan
Publication Date:
07-2010
Content Type:
Policy Brief
Institution:
Africa Center for Strategic Studies
Abstract:
The dollar value of cocaine trafficked through West Africa has risen rapidly and surpassed all other illicit commodities smuggled in the subregion. Experience from Latin America and the Caribbean demonstrates that cocaine traffic contributes to dra¬matically higher levels of violence and instability. Co-opting key government officials is the preferred modus operandi of Latin American cocaine traf¬fickers. African governments need to act urgently to protect the integrity of their counternarcotics institutions to prevent this threat from developing deeper roots on the continent.
Topic:
Crime and Narcotics Trafficking
Political Geography:
Africa, Latin America, and Caribbean

954. Improving Security Policy in Colombia

Publication Date:
06-2010
Content Type:
Policy Brief
Institution:
International Crisis Group
Abstract:
President Álvaro Uribe's eight-year military campaign against the Revolutionary Armed Forces of Colombia (FARC) has taken a heavy toll on Colombia's largest insurgent organisation. The government is now working to consolidate security gains by expanding state presence in several of the formerly most conflict-ridden regions. This strategy faces numerous challenges, not least because FARC's command and control structure has not collapsed. The insurgents are adapting to military pressure through guerrilla warfare tactics, aggressive recruitment among rural populations, broadened involvement in drug trafficking and alliances with other armed groups and drug trafficking organisations. Colombia's next president, Juan Manuel Santos, will take office on 7 August. As part of an integrated conflict resolution strategy, his government must increase the country's law enforcement and military capability against all illegal armed groups, including FARC. It also has to strengthen institutions, expand the rule of law, rigorously protect human rights, reduce poverty and design the political/negotiations component of a successful conflict resolution strategy. Security consolidation can only take root if Colombia tackles its pervasive problems of organised violence, criminality and illegality in an integrated manner.
Topic:
Political Violence, Armed Struggle, and Insurgency
Political Geography:
Latin America

955. Guatemala: Squeezed between Crime and Impunity

Publication Date:
06-2010
Content Type:
Working Paper
Institution:
International Crisis Group
Abstract:
The 1996 peace accords formally ended Guatemala's civil war but failure to address the conflict's root causes and dismantle clandestine security apparatuses has weakened its institutions and opened the door to skyrocketing violent crime. Guatemala is one of the world's most dangerous countries, with some 6,500 murders in 2009, more than the average yearly killings during the civil war and roughly twice Mexico's homicide rate. Under heavy pressure at home, Mexican drug traffickers have moved into Guatemala to compete for control of Andean cocaine transiting to the U.S. The UN-sanctioned International Commission against Impunity in Guatemala (CICIG) has brought hope by making some progress at getting a handle on high-level corruption. However, in June 2010 its Spanish director, Carlos Castresana, resigned saying the government had not kept its promise to support CICIG's work and reform the justice system. President Álvaro Colom needs to consolidate recent gains with institutional reform, anti-corruption measures, vetting mechanisms and a more inclusive political approach, including to indigenous peoples.
Topic:
Conflict Resolution, Security, Political Violence, and Crime
Political Geography:
Latin America

956. Conference report: New Power Relations in Latin America and their Global Influence

Author:
Augusto Varas
Publication Date:
03-2010
Content Type:
Working Paper
Institution:
Norwegian Centre for Conflict Resolution
Abstract:
Significant changes have taken place in the distribution of political power in Latin American countries over the past decade, at both national and hemispheric level. A growing trend toward trans-regionalisation is evident in the political and trade relations of these countries. Changes in regional power dynamics have been further hastened as Latin American countries have distanced themselves from the United States. Moreover, the weakness of US hemispheric policy, resulting from the loss of strategic regional influence, has been compounded by the political and ideological changes in Latin America over the past decade.
Topic:
International Relations, Foreign Policy, Globalization, Political Economy, and Power Politics
Political Geography:
United States and Latin America

957. Sexual Violence in Latin America and the Caribbean: A Desk Review

Author:
Juan Manuel Contreras, Sarah Bott, Elizabeth Dartnall, and Alessandra Guedes
Publication Date:
03-2010
Content Type:
Working Paper
Institution:
The Sexual Violence Research Initiative (SVRI)
Abstract:
The World Health Organization defines sexual violence as “any sexual act, attempt to obtain a sexual act, unwanted sexual comments or advances, or acts to traffic, or otherwise directed, against a person's sexuality using coercion, by any person regardless of relationship to the victim, in any setting, including but not limited to home and work” (Jewkes et al., 2002). A limited but growing body of evidence suggests that sexual violence is a serious problem throughout Latin America and the Caribbean (LAC) – both as a public health problem and a violation of human rights. This document reviews what is known about sexual violence in the LAC region. It aims to explore the magnitude, patterns and risk factors associated with sexual violence, as well as the legal and policy frameworks, women's responses to sexual violence, access to services and service responses, promising interventions, research gaps and priorities for future research. Over two hundred published and unpublished documents were reviewed to prepare this document. Grey literature was identified through internet-based searches and from experts working in the region. The scope of this review is primarily based on research produced between 2000 and the present. While an effort has been made to cover the entire Latin American and Caribbean region, research is not available for all countries in the region. As such, this document should be considered the first phase in an ongoing process of consolidating the existing evidence and identifying research gaps and priorities for this culturally, racially and geographically diverse region.
Topic:
Health, Human Rights, Human Welfare, and Developing World
Political Geography:
Latin America and Caribbean

958. Bases, Bullets, and Ballots: The Effect of U.S. Military Aid on Political Conflict in Colombia

Author:
Oeindrila Dube and Suresh Naidu
Publication Date:
01-2010
Content Type:
Working Paper
Institution:
Center for Global Development (CGD)
Abstract:
Does foreign military assistance strengthen or further weaken fragile states facing internal conflict? We address this question by estimating how U.S. military aid affects violence and electoral participation in Colombia. We exploit the allocation of U.S. military aid to Colombian military bases, and compare how aid affects municipalities with and without bases. Using detailed political violence data, we find that U.S. military aid leads to differential increases in attacks by paramilitaries (who collude with the military), but has no effect on guerilla attacks. Aid increases also result in more paramilitary (but not guerrilla) homicides during election years. Moreover, when military aid rises, voter turnout falls more in base municipalities, especially those that are politically contested.
Topic:
Arms Control and Proliferation, Democratization, and Foreign Aid
Political Geography:
United States, Colombia, and Latin America

959. Regional Trade Blocs: The Way to the Future?

Author:
Alejandro Foxley
Publication Date:
09-2010
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
While middle-income countries have pursued regional trade agreements since the 1960s, these ties are becoming more important as the global economic crisis curtails demand from the United States and other major markets. With the Doha Round of multilateral trade talks stalled, regional trade agreements (RTAs) offer an alternative approach to increase trade, spur stronger economic growth, and lower unemployment rates in participating countries.
Topic:
Economics and International Trade and Finance
Political Geography:
United States, Asia, and Latin America

960. Learning from Dependency and World System Theory : Explaining Europe's Failure in the 'Lisbon Process'

Author:
Almas Heshmati and Arno Tausch
Publication Date:
11-2010
Content Type:
Journal Article
Journal:
Alternatives: Turkish Journal of International Relations
Institution:
Center for International Conflict Resolution at Yalova University
Abstract:
The current paper investigates the cross-national relevance of Latin American 'dependencia theory' for five dimensions of development (democracy and human rights, environment, human development and basic human needs satisfaction, gender justice, redistribution, growth and employment) on a global scale and tries to confront the very basic pro-globalist assumptions of the 'Lisbon process', the predecessor of the ongoing EU-2020 strategy, which was the policy target of the European leaders since the EU's Lisbon Council meeting in March 2000 to make Europe the leading knowledge-based economy in the world with a 'Latin American perspective'. A realistic and politically useful analysis of the 'Lisbon process' has to be a 'Schumpeterian' approach. First, we analyze the 'Lisbon performance' of the world economy by multivariate, quantitative means, looking into the possible contradictions that might exists between the dependent insertion into the global economy and other goals of the 'Lisbon process'. Dependency from the large, transnational corporations, as correctly predicted by Latin American social science of the 1960s and 1970s, emerges as one of the most serious development blockades, confronting Europe. Secondly, we analyze European regional performance since the 1990s in order to know whether growth and development in Europe spread evenly among the different regions of the continent. It emerges that dependency from the large transnational corporations is incompatible with a balanced, regional development. Finally, we discuss cross-national and historical lessons learned from the views of dependency and Schumpeterian perspectives for current policy-making in Europe, and opt for an industrial policy approach in the tradition of former EU-Commission President (1985-1995) Jacques Delors.
Topic:
Economics
Political Geography:
Europe and Latin America