Regional Economic Outlook: Western Hemisphere - Heating Up in the South, Cooler in the North, October 2010 -- Table of Contents

Western Hemisphere, October 18, 2010

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Canonical URL: Regional Economic Outlook: Western Hemisphere - Heating Up in the South, Cooler in the North, October 2010 -- Table of Contents

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Bibliographic details

Published: October 18, 2010
Series: Western Hemisphere

Overview

Title: "Heating Up in the South, Cooler in the North"
Date: October 2010
Press Release date: October 19, 2010
Broad theme: Mixed environment—slow recovery in the United States and other advanced economies, strength in Asia—produces divergent outlooks across Latin America and the Caribbean.
Focus areas:
- Financial issues in Latin America: managing credit expansion safely and macroprudential financial policies amid low global interest rates and capital flows to emerging economies.
- Caribbean economies: drivers and obstacles affecting growth.

Contents and Key Analytical Themes

Preface
Executive Summary

Chapter 1: Global, U.S., and Canadian Outlook
- The Global Backdrop—A Recovery Still Led by Emerging Economies
- United States—Recovery Is Still Policy Driven
- Canada—Strong Recovery with Elevated Risks
- Implications for the Latin American and Caribbean Region

Chapter 2: Latin America and the Caribbean: Recent Developments and Outlook
- Growth to Normalize from Recent Highs
- Wide Divergence in the Regional Outlook
- Diverse Policy Challenges
- South America—Ensuring a Soft Landing
- Withdrawing Policy Stimulus Amid Ample Global Liquidity
- Favorable Terms of Trade Continue to Offset Limited Market Access
- Mexico and Central America—Recovery Gathers Strength Despite Headwinds from the United States
- Mexico: Fiscal Consolidation Amid Weak Trading Partner Outlook
- Central America: Rebuilding Policy Buffers
- The Caribbean—Turning the Corner Amid Vast Challenges
- Securing Growth
- Reducing High Debt Burdens
- Strengthening the Financial Sector

Chapter 3: Looking at the Last Credit Cycle to Better Manage the Next One
- An Overview of the Financial System
- Learning from the Last Financial Cycle
- How Big Was the Recent Cycle?
- Shifts in Funding and Asset Structure
- Differences in Bank Behavior: Foreign and Public Banks
- Asset Quality
- A Complementary Financing Role of Bond Markets
- Policy Implications for the Ongoing Cycle
- Using Macroprudential Regulation to Smooth out Financial Cycles
- Keys to Financial Deepening in a Safe Manner
- Increasing Crowding in, where Possible
- Foreign and Public Banks
- Strengthening Other Financial Markets
- Final Remarks

Chapter 4: Macroprudential Tools in Latin America: A Primer
- Systemic Risk and Macroprudential Policy—An Ongoing International Debate
- Recent Country Experiences with Macroprudential Tools
- Macroprudential Policy Challenges in the Current Latin American Context

Chapter 5: A Cross-Country Perspective on Growth in the Caribbean: The Role of Tourism and Debt
- Growth Performance in the Last 40 Years
- A First Pass: Growth Accounting
- Does Tourism Help Growth?
- The Drag from Debt
- Conclusions

Appendix
- Western Hemisphere: Main Economic Indicators
- Latin America and the Caribbean: Main Fiscal Indicators
- References

Notable Boxes and Case Topics

Chapter 1 boxes:
- 1.1 Labor Market Adjustment in the United States
- 1.2 The Financing of U.S. Federal Budget Deficits—and Its Global Implications
- 1.3 Highlights of the 2010 U.S. Financial Regulatory Reform
Chapter 2 boxes:
- 2.1 Latin America’s Resilience to the European Financial Turmoil of 2010
- 2.2 The Outlook for Commodity Prices and the Role of China
- 2.3 Reserve Accumulation: Building Insurance or Leaning Against Appreciation Winds?
- 2.4 What Is Driving Financial Dedollarization in Latin America?
- 2.5 Domestic Demand Growth under Easy and Tight External Financial Conditions: The Role of Exchange Rate Flexibility
- 2.6 Real Spillovers from Brazil into Neighboring Countries
Chapter 3 boxes:
- 3.1 Structure of Private Sector Credit Market: Role of Foreign Banks
- 3.2 Government Bond Markets in Latin America
- 3.3 Financial Structure and Corporate Performance during the Global Crisis: Microevidence for Latin America
- 3.4 Public Banks as a Countercyclical Tool: Experience in Brazil, Chile, and Costa Rica
Chapter 4 boxes:
- 4.1 Dynamic Provisioning in Latin America
- 4.2 Reserve Requirements as a Macroprudential Tool in Latin America
Chapter 5 boxes:
- 5.1 Haiti's Growth Performance and Challenges
- 5.2 Outlook for Tourism in the Caribbean––Is Cuba a New Competitor?
- 5.3 Debt and Growth

Key Analytical Takeaways (as framed by the Table of Contents)

Regional divergence: stronger conditions in parts of South America and persistent coolness in the North due to uneven global recovery dynamics.
Financial-sector emphasis: careful management of credit expansion and deployment of macroprudential policies to mitigate risks from capital inflows and low global interest rates.
Caribbean focus: tourism's role in growth and the constraining effect of high debt burdens on long-term performance.
Policy concerns highlighted across chapters include withdrawing stimulus amid global liquidity, fiscal consolidation in Mexico, rebuilding buffers in Central America, and strengthening financial sectors in the Caribbean.

Regional Economic Outlook: Western Hemisphere - Heating Up in the South, Cooler in the North, October 2010 — Table of Contents. https://www.imf.org/en/publications/reo/wh/issues/2017/01/07/regional-economic-outlook-western-hemisphere2

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