New financing trends in Latin America: a bumpy road towards stability

BIS Papers No 36
February 2008

In May 2007 the Bank for International Settlements (BIS) and the Federal Reserve Bank (FRB) of Atlanta hosted a meeting in Mexico City on "New financing trends in Latin America: a bumpy road towards stability". The meeting, which was chaired by Philip Turner of the BIS, brought together senior officials from central banks, finance ministries, the private sector, multilateral institutions and academia to discuss issues and challenges from the most recent financing developments observed across the region.

Five main issues were addressed at the meeting: recent trends in Latin America, the influence of certain idiosyncratic features on financial developments in the region, the benefits and challenges of the development of domestic local currency bond markets, the implications for monetary policy and the coordination of debt management policies between central banks and finance ministries and, finally, the implications for financial stability.

This meeting was a "first" as a collaborative effort between the BIS and the FRB Atlanta, and was organised at the initiative of the BIS Representative Office for the Americas (inaugurated in 2002) and the FRB Atlanta Americas Center (created in 2005). Given the significance of the topics discussed in the meeting, we decided to publish in this BIS Papers series the contributions by José Antonio Ocampo (United Nations Under-Secretary General for Economic and Social Affairs) and Professor Barry Eichengreen (University of California, Berkeley), a contribution by the Bank of Spain, and the background documents prepared for the meeting.

JEL classification: E4, E5, E6, F0, F2, F3, G1, G3, H6, O1

Keywords: capital flows, financial markets, domestic bond markets, macroeconomic policies, financial stability, public debt, corporate governance, transmission of monetary policy, Latin America

Chapters

New financing trends in Latin America
Financing trends in Latin America
Policy space and the changing paradigm in conducting macroeconomic policies in developing countries
Latin America's local currency bond markets: an overview
Financial stability implications of local currency bond markets: an overview of the risks
Local debt expansion and vulnerability reduction: an assessment for six crisis-prone countries
Plumbing for Latin American capital markets
Domestic securities markets and monetary policy in Latin America: overview and implications