IMF expects the region to prepare for crisis

International Monetary Fund (IMF) said yesterday that Latin America must be prepared before the crisis in Europe and the fall in the prices of raw materials with credible fiscal policies and monetary and exchange rate flexibility.

Said the Chilean Nicolás Eyzaguirre, director of the Western Hemisphere Department of the IMF, "the prospects for the region depend on policy measures to be taken in Europe".

IMF announced on 24 January cut four tenths in Latin America economic growth prospects for 2012, to 3.6%, in a global environment with risks because of the crisis in the eurozone.

Eyzaguirre stated that Latin America should be "hope for the best, but prepare for the worst", despite the fact that the region enjoys a favourable internal momentum and stable financial systems.

Nevertheless recommends that Latin American countries maintain flexible exchange rates and prepare for a u000afall in the price of raw materials, which are expected to contribute 5 per cent for oil and 14% on average for non-oil products.

For Latin America and the Caribbean a weak global growth, the IMF expects that by 2012 it's a 3.3% compared to 3.8% in 2011, and raw materials at low prices translates into less favourable prospects.

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