This upcoming week and month will bring attention from the FPA towards Latin America. In addition, Fareed Zakaria interviewed Alvaro Uribe, President of Colombia last week and the interview was aired this past Sunday. Brazil and Rio de Janeiro has also won their bid to host the first Olympics for Brazil and South America as a whole, but issues abound as developing countries will always be seen in the light of the negative and positive aspects of the last Olympics in China, a fellow BRICs nation where order and progress might not include all Carioca in this celebrated event.

A book signing by Ambassador Heraldo Muñoz will take place on October 8th in New York City. Heraldo is the Permanent Representative of Chile to the United Nations and Chairman of the United Nations Peace-Building Commission. He will discuss his new book, “The Dictator’s Shadow: Life Under Augusto Pinochet” at the lecture and book signing. Those of you in New York who would like to attend can find the link to the event here on the FPA website.

Later in the month, a lecture series supported by the FPA will be presenting His Excellency Ambassador Arturo Sarukhan, Ambassador of Mexico to the United States. He will be speaking on: “Mexico’s Foreign Policy and the Current State of Mexican-American Relations.” For more information on the October 21st event, please see the link here.

Fareed Zakaria has interviews numerous leaders in the Middle East and Latin America last week. His interviews with Chavez, Ahmadinejad, and Gadhafi last week were topped off with a short interview with President Alvaro Uribe of Colombia, which was aired this past Sunday. I have a great appreciation of Zakaria’s work and focus on global policy issues and thought his interviews last week did bring out important questions and concerns, which were politely asked and validly addressed and pressed upon in all three initial interviews. Uribe’s interview, while informative, did lack deeper questions and seemed to be a lot shorter than those last week. Generally Zakaria asks many questions of leaders which I have always wanted to know myself, but often can only find in Spanish language or Arab language media. The interview with Uribe was altogether good, but for a leader who is likely the most popularly elected leader in the Western Hemisphere, certain questions were absent for the most part. Zakaria is well aware of the threats on Uribe’s life, 15 and counting, and Uribe answered those questions diligently. What I believe was lacking was questions on Colombia’s position and evidence regarding foreign support for the FARC and other internal terrorist movements in Colombia. This was a disappointment due to the lack of attention in English language media on the topic and the fact that in the interview with Chavez, conflict with Colombia was addressed but not responded to in the accompanying Uribe interview. As well, claims by US and Canadian officials denying support for an FTA between Colombia and its northern neighbours did not enter into the discussion, despite the growing debate over the country’s human rights record. This would have been interesting as the US and Canada has a trade policy that avoids criticizing similar or worse human rights records with other US and Canadian trading partners, namely China and for Canada, China and Cuba to name a few. While the agreement will be passed it seems between Canada and Colombia, an election in Canada was almost created over the issue two weeks ago and another election might be started ironically on the lack of trade between Canada and China as seen in early election commercials by one of the opposition parties. No matter what position viewers might have taken on Colombia and associated issues, a discussion on those topics would have informed us better on a situation that many have opinions on but few really understand.

Now for lighter fare, Rio de Janeiro has won their bid to host the 2016 Olympics, being the first South American nation to host the event ever. Mexico did host it nearly 40 years ago, but for the continent to the South it is a deserved first. It seems that the Olympic Committee is starting to see themselves as the ones who should pick the winners of the global economy in the future, but success does not always come from the event even if the country does well post Olympics. China received much criticism of their treatment of Tibet and Uigurs in the build up to their Olympic games and many citizens in Beijing lost their rights to property and their homes in the process of building grand structures for the games and making China look issueless in the process. The Committee should have expected this and many protestors sought to hold them to account for it.

Regarding Brazil, like with China and other developing nations, the Committee should consider questions of poverty and the benefit to the whole. If they choose to pick winners for policy reasons that often slide into issues of security and economics, then the result of that progress should be taken into account. Brazil has done its best since the 1980s to reform every aspect of its society, reduce poverty and balance the economy, even successfully in the latest economic storm. Crime and poverty however will be a major issue in Rio even in 2016, and while these issues cannot be resolved in such a short time, a focus on reduction and avoiding the repeat of China 2008 where the disadvantaged in China were ignored by China and the Olympic Committee is unacceptable in 2016 as it was in 2008. I do have faith that Brazil will do its best to provide for all events, and have learned from China 2008 on what not to do and who not to avoid. Boa Sorte Cidade of the Cariocas!

This past week has been filled with numerous interesting policy stories and interviews regarding issues that affect every nation in the world, focusing on those regions such as the Middle East and Latin America, which seem to be the source of much of the security tensions for the members of the UN Security Council.

First to address the return of Zelaya to Honduras, mind you within the legal jurisdiction of Brazil. Manuel Zelaya, the removed elected leader of Honduras finally returned to Tegucigalpa after several attempts. He arrived with unknown help, but ended up inside Brazil’s Embassy in the Honduran capital. Arrests were attempted and protests ensued, but he remains there for the time being as the OAS and US push for a meeting between Zelaya and the “new” leaders of Honduras. The reality is that Central America is often not a principal concern for many major powers in the Americas, but major powers often determine the outcome of politics in Central America as opposed to the people themselves. The role of Brazil, who many see as South America’s political giant is somewhat skewed in this incident, as often Central America is left alone to the sphere of the US. Brazil might unwillingly be dragged into the Honduran mess in a mediation role and since the US is surprisingly supporting Zelaya, Brazil may be the only country in the region who can be seen as somewhat impartial in this incident as is usually the case in the region. Even though the US and Venezuela are supporting Zelaya, the reason why Honduras has become for the first time in its history a subject of national interest is because Zelaya’s attempt to be elected indefinitely mirrors the populist approach Chavez has taken in Venezuela successfully. Obama’s support for Zelaya may be tantamount to his speech in Cairo, showing a new moderation towards past opposition, in this case leftists in the region, and a balanced approach to policy. It does not seem to be working all that well unfortunately, as possible interference by Venezuela in Honduran affairs cannot be balanced by an impartial Brazil and is not being critcised by the US in any substantial form. This leaves the “new” Honduran leadership with few options but to hold up a strong front against Zelaya, one that will remain at the doors of the Brazilian Embassy as not to cross into Brazil’s legal property inside Honduras. As long as Zelaya is accused by his opposition in the Senate and Judiciary of Honduras, the likelihood of allowing Zelaya to regain any position of power will result in more protests and cracking down of protestors. The only positive aspect of a likely messy outcome is that at least they are not in Iran.

Larry King on CNN brought two surprise interviews this past week with Hugo Chavez, and Mahmoud Ahmadinejad, and Fareed Zakaria will be interviewing Gadhafi this weekend. Gadhafi has received a lot of attention recently with his extended speech at the UN and the scandal in the UK regarding the release of a convicted terrorist and their return to Libya due to illness. Before that incident however the relations between Libya and the western world were luke warm. The issue that will likely have the largest impact long term is the open policy actions by the UK government mixing business interests with justice issues, as opposed to actions by Gadhafi himself which were most likely expected by anyone who knew anything about Libya. The view of the British people shows that their government might be doing something which many in developing regions have accused western powers of doing for decades, placing oil before rights, and this will bring down the Labour Government and tarnish Mr. Blair’s reputation and keep Mr.Brown in the political crosshairs where he essentially has always been. Like Honduras, Libya’s issue will die out with a lengthy investigation or the death of the Lockerbie bomber, and the world will refocus on the major players, which brings us to King’s interviews.

The first one I was able to see was the one with Hugo Chavez. It was an interesting interview, but no new information came out of it that Chavez did not speak about in length whenever he had the opportunity. Three comments stood out as one’s of interest in my opinion. Chavez compared his military spending as being one-tenth of that of Colombia. Documented information makes his claims quite puzzling, as Venezuela has purchased and continues to purchase a great number of top of the line Russian military equipment. Compared to similar equipment in Colombia there is no threat from the Colombian army technologically. Colombia also has internal security issues, claimed by Colombia as supported by Chavez himself and would be able to justify large amounts of spending. Chavez’s fear was that Colombia could attack Venezuela as was done briefly two years ago against Ecuador when raiding a FARC encampment seems to the root of his security concerns, but with people dying in Colombia possibly due to arms coming from Venezuela, he might not be the innocent party between the two countries.

Chavez also spoke about his past detention and referring to Bush as the devil. He is convinced that in his past detention in Venezuela and afterwards that US agents were trying to kill him. He didn’t explain how he knew this was the case, but there will be an Oliver Stone movie coming out about Chavez soon that will likely explain as little as Stone movie about Castro did.

The issue that caught my attention was King’s question on why Chavez is supporting Iran’s government, despite the popular protests taking hold there. Chavez noted that internal issues of a state are internal, mind you Chavez often involves himself in the issues of other countries, but for some reason when blood is spilled for a similar cause he stands for in Venezuela and is crushed in Iran, then it seems to be allowed. This is nothing less than disgraceful to those in Latin America who had to endure real threats to their lives and those in Iran who peacefully protest and are cut down in the streets while Chavez ignorantly tours the Middle East. They both shared the perspective that Israel’s “genocide” was the issue that dominated internal issues in Iran and Latin America, although I am unsure why possible crimes in another city gives the right for someone to kill their neighbours in their own city. Chavez did acknowledge the Holocaust unlike Ahmadinejad. He also said he was a friend of the Jewish people and even said he was a Colombian himself. Previously he also said Colombia was Latin America’s Israel; maybe he is an Israeli too?

In the interview with Ahmadinejad, the issue of Venezuela did come up. Two points were addressed by King that were related to Venezuela. One was the fate of the young girl Neda, who was shot during a protest. Ahmadinejad supposed that in Venezuela a similar incident took place where two cameras were fixed on the victim before they died in a protest in Caracas. He didn’t say much after that, but it hinted that the death was arranged somehow, and they left it at that. The second issue that was asked by King of both leaders I believe was the growing ties between Iran and Venezuela, especially ties to nuclear energy. While both countries are energy giants with vast oil reserves, the persistent development of nuclear energy and ties with Iran and Iran’s aggressive stance in the region might turn Chavez from Castro minus the wit into a major security concern, or another “missile crisis” with Iran and Venezuela pressuring western powers in Europe and the US with ballistic missile threats in both the Middle East and Latin America. With the discovery of a new secret nuclear plant in Iran and a cohesive stance being built in the Security Council, it is likely that sanctions will not be seen as sufficient in dealing with Iran, and any nuclear activity in Venezuela may be swiftly dealt with by the US itself. The reality is that a minimal percentage of people in Venezuela and Iran would give their lives in a war to keep either leader in power. Both claim the right to any activity they wish as a sovereign state, but when other states are affected by their actions, a right to respond is also within reason. It could be that Zelaya is returned to power and Gadhafi simply retires as their allies enter into armed conflict over issues that do not need to exist. King’s interviews did not bring to light anything new, but his great questions did confirm the worst expectations most have of leaders who wish to define their destiny as populists who do not mind claiming sovereignty over local jurisdiction while involving themselves aggressively within their regional issues.

The last month of economic news has been as diverse as the last 10 months of the same forecasts. With the start of July, the drop in recent markets worldwide and predictions of further problems in large economies such as the UK and Japan set to bring the recession further attention, but by mid month the result was that some US banks were making some profits, even paying back small sums of money to Mr. Obama and some auto manufacturers were not destined to be completely eliminated as stability slowly crept back into market forecasts. While these announcements will likely change in the next few weeks as SME’s continue to wind up their companies, the biggest market change seems to be coming from China and India. While many believe that only 8% growth in China may be the limit in order to stave off mass discontent among its population, growth rates of 5% or more in places like India, and lower yet stable rates in Brazil draw attention to hopes of an economic recovery coming from the recently famous super emerging economies of the BRICs. Of great interest and increasing popularity, Brazil, who has managed to maintain a stable growth rate in their economy since the 1990’s global economic troubles between 3-5% and was able to reasonably shield itself from the meltdown of Argentina’s economy in 2001. Brazil is beginning to change into the next large emerging market economy in form and function. The recent recession has taken the new Brazil and brought its relative successes in the last few months into the meeting rooms and policy branches of those economies who wish to change the relationship between North America and Europe towards South America’s largest and most promising economy.

In the Americas there are two large economies outside of the United States that while being hit hard by the recession, have managed to keep the core financial and economic systems of their countries in good shape. Canada and Brazil have stood out as two of the largest stable economies in the Americas and worldwide. With banking systems that have not collapsed and reserves of cash from past years of growth shielding some of the effects of the global economic crisis, both countries could begin to push the Americas and world economy back into positive territory. Limits to BRICs and other relatively healthy economies may be restricted formally and informally however depending on how the EU and US decide to react to other large economies worldwide. Effects on countries such as Canada and Brazil might be produced by restrictions coming from the new Buy America provisions in the US or as an example, be expanded by talks of a possible EU-Canada Free Trade Agreement. Limiting trade between NAFTA partners in North America and retracting from agreements between the US and trade partners in the Americas is what all trading partners of the US fear in the region as well as globally.

Many experts on global economics such as Zakaria and Khanna see the US as possessing a major role in the future world economy, but also one of shared influence and regional power as a necessity. Limits to expanding the economies of the Americas in a united fashion is seen in the lack of interest in regional trade agreements and the lack of support for trade agreements as with the one with the US and Colombia. While the US seeks to put pressure on its economic allies during the recession, the EU is seeking increased open trade with large economies such as Canada, India and China, and China is seeking many economic ties with countries such as Peru, Chile, Venezuela, Argentina and of course Brazil. Even Canada has ratified a trade agreement between itself and Chile, Colombia, Costa Rica and is working on agreements with CARICOM. Effects from Buy America might better regarded as the Buyer Beware provisions, as the US creates a policy environment to push its allies to trade with other economies outside of the Americas and produce economic legacies outside of the US which will strangle future growth of private industry in the US itself. As with any investor, the prospect of future governmental and trade restrictions by doing business with a US company or investor will produce negative incentives in the long run. With so few healthy investors currently, economic legacies such as Ford, Disney, Coca-Cola and McDonalds may be replaced by those created and grown in other healthy economies outside the US and the Americas…bad economic policy is simply a caveat emptor of economic growth.

Not all US policy experts agree with Buy America, and some even have been making attempts to approach Brazil as the next India or China. Mind month, the publication and discussion of the new book: Brazil as an Economic Superpower? Understanding Brazil’s Changing Role in the Global Economy was accompanied in Washington DC by a discussion of Brazil as a rising global economic power. This book launch and discussion followed the Brooking Institutions release of interesting economic data and reports on the region as a whole. Many of these discussions focus or Brazil or Latin America as the next China or India, but in reality the Latin American method or growth and that of growth in China, India and Russia only bare some basic similarities. Latin America and Brazil have traditionally depended on commodity prices principally. While the Brazilian economy is fairly diversified, a large portion of its GDP does come from commodity and oil prices, which is similar to a country like Canada who have a great deal of GDP linked to natural resources. Manufacturing in all economies, including Canada, Brazil, China and India have been greatly affected, leaving China with a growth rate of 6.1% in the first quarter of 2009. While oil prices and other commodity prices have bounced back and forth since 2008, manufacturing has taken severe hits in all nations. China and to a certain degree, India, depend greatly on the demand in foreign markets on US and global consumer spending. Entrepreneurial Organisations such as the SBA.org in the US and CFIB in Canada would be able to make the point that many of the jobs in the US and North America depend on SME’s, and with the increase in bankruptcies and the lack of business loans coming from banks in any financial state, the job loss will only increase and create a further decline in consumer spending. Manufacturing depends on its consumers being able to purchase its good and grow the economy. China, who produces many of these good in the US and EU are entirely dependent on these economies as their growth is directly linked to US and EU consumers. Brazil, while dependent on consumer spending has less than 40% of its trade with the US and is balanced by heavy industry, commodities and technology industries. While many of these sectors are hurt by the recession, it gives Brazil some added security in the long term within the global economy.

The news on recent increases in growth in China and India are positive, but with many consumers losing jobs recently and many smaller industries only failing in recent weeks, it is hard to predict a concrete economic demand for consumer products and link growth in China to the markets it depends on. In reality, many smaller and larger US firms often depended on cheap operating loans from US banks, and without not only financially stable banks, but banks willing to give out loans to investors, it is impossible to justify any prediction of growth in consumer spending when SME’s are neglected from economic recovery and are the last to receive financial aid in the economic crisis, yet provide the majority of jobs in many developed countries. Countries like Brazil and Canada should be considered a relatively strong option for investors, as historically and logically growth seems more likely for all levels of industry in few similar countries in the long run and the avoidance of economic bubbles have been relatively successful in the past.

An interesting piece I encourage you all to read:
Latin America and the Economic Crisis: Designing and Implementing Stimulus Policies
Mauricio Cárdenas, Director, Latin America Initiative
The Brooking Institution

June 25, 2009 —
Dani Rodrik recently wrote in his daily blog that Andrés Velasco is the living example that sound macroeconomic policies have a high dividend. Chile’s decisive fiscal stimulus package—adopted last January—has made him President Bachelet’s most popular minister. Not too long ago, during the years of high copper prices, many Chileans questioned their government’s economic management for saving too much and postponing key investments. Of course, those critics are silent now. Events are showing that a commitment to rules that focus on long run objectives, rather that immediate gratification, pays-off.

But rather than talking about Chile, I would like to make a more general point regarding Latin America. Today’s conventional wisdom –and I say this in complete awareness that ministers generally adhere to, and oftentimes shape, mainstream views—is that stimulus packages are working and that Latin America will soon be out of the recession. In Brazil, for example, most analysts consider that the contraction is a thing of the past. I want to take issue with those views.

Let me start by stating what, in my view, is the conventional wisdom:

The adoption of sound macroeconomic frameworks, mostly since the late 1990s, allowed Latin America to bring down inflation and public debt. Foreign reserves are high for historical standards, reflecting stronger current accounts and access to external capital. As a result, Latin America is coping with this crisis much better than a decade ago. In fact, there has been no crisis, just a mild recession.

Key to the current episode has been the ability to conduct countercyclical monetary and fiscal policies. In the current phase of the cycle, policy rates set by the central banks have been cut to 0.75% in Chile (a reduction of 7.5 percentage points), 4% in Peru, 4.5% in Colombia, 4.75% in Mexico, and 9.25% in Brazil.

Fiscal stimulus has also been the norm, although the size and composition of packages has also varied from country to country. The largest expansions have taken place in Chile (2.5% of GDP), Brazil, Peru, and Mexico.

Macro-financial variables have shown remarkable stability. In 2009, inflation has been falling, exchange rates have appreciated, stock prices have increased, and spreads on sovereign debt are falling.

Even though production and employment figures are still declining –and GDP growth projections are being revised downwards– virtually all forecasts suggest that the recovery will start soon. The latest Global Development Finance Report from the World Bank (the less optimistic of the existing “official” reports) projects major rebounds in all economies. The difference between the 2010 and the 2009 GDP growth forecasts is 5 percentage points for the world economy. The corresponding figure is 5.4 percentage points for the OECD countries, and 4.2 percentage points for Latin America. The expected rebound is spectacular for Mexico (7.5 percentage points).

I think this view errs on the side of optimism. Latin America should hope for the best but prepare for the worst. By not properly considering the risks ahead, governments have the temptation of exhausting the policy tools and not reserving any ammunition for battles that are foreseeable. My critique of the conventional wisdom is based on the following four points:

The numbers on real activity and aggregate demand conditions which are coming out from Latin America are not that encouraging

Although it is true that retail sales in Brazil increased 6.9% in April (relative to a year before), industrial production registered a 14.8% contraction in May. In Mexico, where GDP contracted by 8.2% in the first quarter, industrial production fell 13.2% in April, and consumer confidence continued to fall in May. The Chilean economic activity contracted 4.6% in April and industrial production fell by 11.1%. The figures for other countries show a similar picture: Latin American economies are experiencing a deep contraction, and the evidence does not suggest a significant recovery underway.

Of course, all this could change with a big rebound in the second semester. But, is that realistic? The contraction in investment has been in the double digits during the first months of this year for the majority of countries in the region, and will have an impact on future growth. More importantly, investor and consumer confidence measures are very low and still falling in the majority of Latin American countries. We know from past episodes that it takes time –and a good amount of positive economic news– to reverse the direction of these perceptions, especially the consumer’s sentiment.

Latin America is betting on the rebound of commodity prices

China’s real GDP growth slowed to 6.1% during the first quarter of this year. Although several measures of real activity and domestic demand have been improving lately (investment grew by 32.9% in five months to May), exports continue to deteriorate. Chinese exports contracted by 26.4% in May, suggesting that there is excess capacity. To the extent that exports do not recover, investment will loose momentum as well as commodity imports, which have increased for stockpiling purposes. These are very negative news because they suggest that the surge in commodity prices will not last. Why commodities moved ahead of the fundamentals is not clear, but Latin America should be prepared to deal with prices which are more in line with lower Chinese import demand in future months.

Private capital flows are shrinking at an alarming pace

The World Bank projects that net private debt and equity flows to developing countries will decline from 8.6% of global GDP in 2007 to 2.0% in 2009. This is much worse than in the debt crisis of the 1980s or the Asian and Russian crises combined. Many in Latin America argue that the region is somehow immune to this trend, mainly because of the role that foreign direct investment plays in the region. This could be true, but at the same time, the evidence available suggests that FDI flows depend largely on growth in the OECD countries. With the major contractions expected in the U.S., Europe and Japan, FDI flows will fall in the medium term. The latest IMF data suggests that this is already happening. The investment projects under way are likely to be completed, but starting new investments is a different game. The recent drop in the cross-border M&A activity is a strong signal in this direction.

For the emerging and developing countries as a whole, private debt and equity flows will likely fall short of meeting external financing needs. The question is how much of the shortfall will affect Latin America. Some countries are better prepared than others. Countries with large current account deficits, strong dependence on tourism and remittances, and limited access to private debt and equity flows will suffer considerably. This of course, points in the direction of Central America and the Caribbean, where a sharp adjustment seems inevitable.

In the largest countries, with access to international markets, much will depend on the ability of private firms to roll over their debt. There are hundreds of corporations in these countries that borrowed in the international syndicated loan market and some that issued international bonds during the last few years. They hold the majority of the outstanding short term external debt as well as the medium to long term obligations coming due in 2009. Financing the public sector is not the problem; the real issue is how to refinance the large Latin American corporations.

The prospects in this regard are not all that encouraging. The supply of credit to the region could fall even further because there are mounting pressures on the capital position of the major banks. Liquidity problems in the global interbank market remain an obstacle for banks to fund additional assets, while tightening of credit standards has been generalized. Last but not least, government ownership (even if temporary and partial) of the large banks changes the priorities in the direction of domestic recovery in the developed world, rather than greater credit risk exposure in emerging countries.

There is no ammunition left

The capacity of central banks to cut interest rates and of governments to provide more fiscal stimulus is very limited. Even in Chile, there is discussion that the fiscal deficit is already too high and that the government should bring it down again next year. The Mexican central bank has said that further cuts in interest rates are not likely, in line with the language other monetary authorities have used recently. In other words, fiscal and monetary policies do not have many degrees of freedom. If the world economy does not recover soon and private capital flows to Latin America remain low, there is not much that Latin American countries can do. Even worse, it is possible that some of the expansionary policies of the recent months will need to be reversed. This is already part of the debate in countries like Mexico, where the government may need a tax increase to cut the fiscal deficit in 2010.

In summary

In summary, Latin American governments and multilateral banks are betting excessively on a sharp economic recovery. For their projections to be right, a major recovery should be already underway. The latest figures, however, do not support that view. Even if the U.S. shows a moderate V- shaped recovery in the next two quarters, China’s imports, commodity prices, and private capital flows could still be the source of very unpleasant news for the region.

This weekend leaders from across the Americas have made their way to Trinidad and Tobago for the fifth meeting of the Summit of the Americas to discuss the future relations between nations in North and South America, the Caribbean and between others interest groups in the region. The Summit is often the centerpiece for inter-governmental discussions and policy formations between nations in the region. The last few Summits have been dominated by the formation of multilateral and bilateral trade discussions, albeit with slowly dwindling support for the FTAA since the Quebec City Summit in 2001, the Summit of the Americas has moved away from discussions of a multilateral agreements into the shiny and new 2009 Summit which seeks to patch up open ended policy debates in the region, address security issues and produce some form of future dialogue between the US and states which formally have had rough relations with the Americans in the past. The best evidence of this new Summit approach is the move by the Obama administration to open a dialogue with Fidel and Raul Castro which has been reciprocated this week, make open discussions of how the US and Mexico can claim their part in the drug war, create and new open-hand diplomacy towards Venezuela and Bolivia and have increased trade with traditional allies in the hemisphere. Below I will discuss the possibility of some future developments between the US, its neighbours in the hemisphere and relations between other members and internal struggles within some countries in the Americas.

This week saw an attempt on the life of Bolivian President Evo Morales. I was able to see a live discussion with President Morales via webfeed on the Summit Website earlier on Saturday which was quite impressive and needed to be noted. Bolivia has gone through a great deal of policy changes with Morales. As one of the first indigenous leaders in Latin America, Morales has shifted much of his policy into poverty reduction strategies and through popular support, and adjustment in the power structure in his country. With a recent protest to withhold eating until anti-poverty measures and land reform issues were passed through into policy by the Bolivian Parliament and a very recent attempt on his life, there is no doubt of his commitment to changing Bolivia. Support for Morales will likely remain due to his popularly with many poorer indigenous communities that give him a large support base politically. A possible opening of relations with Bolivia’s allies in Venezuela and Cuba with the United States may change the situation greatly. In most cases Morales will be there until he is unable to satisfy the popular elements in society or so greatly alienates what he refers to as the oligarchs in society that he is unable to withdraw from protests. Bolivia will likely follow the natural course of populists in the region, albeit hopefully without violence becoming an end result.

A possibly historic move by President Obama during the Summit might be a sign of thawing relations, as Barak Obama made his way to shake the hand of Hugo Chavez in an act of good will. While Chavez was criticized in US media recently for claiming that Obama needed to study up on Latin America, Obama’s active move towards open-hand diplomacy was met by a friendly response. Obama was even given a book about the history of Latin America by Chavez, but in maintaining his position Chavez handed Obama a book which some call an academic work which compiles a drastic account of state-to-state oppression by the US in Latin America. Despite slight posturing, an opening of a dialogue has already resulted in Venezuela re-instating its Ambassador to Washington and might result in some added passive economic ties between Venezuela and the US that builds on already existing trade in many markets between the two nations. The larger effect of Obama’s move to open dialogue further with Chavez likely comes from his very open and quick moves to re-initiate ties with Cuba. Although Cuba was ejected from the OAS in the early 1960s, thus did not have a formal representative at the Summit, Obama made it clear that a lifting of the travel restrictions on Cuba would be a priority as well as talks with Cuba’s leading family which were accepted by Castro before the Summit commenced. A discussion of this further by FPA’s Great Decisions program can be seen on a video titled The Latin American Left. Click here to see the video link.

Before the Summit, Obama went to Mexico to show his support for and claim some responsibility for the drug war now taking place in Mexico. Many in the US and Mexico believe that in order to conquer the drug cartels in Mexico itself, a concerted effort must be coordinated between the source of the narcotics in Mexico, and the source of weapons and main market for drugs in the US, and even the market in Canada where Canada’s Olympic city has been enveloped by a mini-drug war itself. In addition, Obama’s stop in Mexico City before the Summit brought Mexico into a similar light with the issues surrounding Cuba. The United States closest Latin American neighbors for the first time in two generations are finally being properly re-engaged, which sends a message to the rest of the region and creates a new energy for the Summit that shows the US as an open-hand to discussions in the region after many years of neglecting US-Latin American Relations. In his speeches, Obama sought to claim responsibility for US actions in the region in an attempt to clean old wounds between neighbours. He also stated that despite US actions in the region, it also must not become a scapegoat for all problems in the Americas. To see an article and video by the FPA writer Marco Vicenzino on Obama and Latin America, please click here.

The US policy towards Latin America has often been linked to free trade, and while the issues of trade and protectionism might not have been in the spotlight this weekend, America’s closest allies in the Americas have not forgotten the importance of this relationship. Economic powerhouses in the Americas such as Argentina and Brazil have been battling through the latest economic crisis but seek to open further trade ties with the US and other investors. China’s role in investment in Argentina and Brazil and other Latin American markets have started to rival those coming from the US, World Bank, IMF and IADB in levels of investment, albeit with more favorable lending conditions. Canada, the United States’ largest trading partner in the region sought to assist the US in opening relations with Cuba, to which Canada has always maintained, but hoped to keep the issue of trade protectionism in the focus of the Summit leaders as both developed and developing nations in the Americas would be greatly hurt if trade was sacrificed in the process of reinvigorating the economy in the Americas. A $4 billion cash infusion was also promised by Canada to the IADB during the Summit and moves towards a CARICOM-Canada FTA. An opening between the US and Cuba was seen as a positive for Canada as well, as support for trade between all three countries is seen as a benefit from US investment.

The greatest concern for many worried about trade protectionism in the melee of new policies and ideas at the Summit is what to do about trade and countries such as Colombia, who is the United States’ strongest ally in South America, but is being battered by interest groups in the US and opposition in Canada for the extension of Free Trade between the US, Canada and Colombia due to human rights abuses against labour leaders in Colombia. Opposition to a Colombian FTA is so great that it is doubtful that a minority government in Canada will be able to ratify it, and despite the US having strong trade ties with China and an opening with Cuba who also have numerous human rights violations, a Colombian FTA has been placed in a holding pattern of policy formation in the US Congress. Perspective must be taken into serious consideration, as the US often cannot justify trading with some partners, and penalizing others such as Cuba for human rights offences. Colombia is a success story against the drug war in the Americas, and opening a stronger economy between Colombia and North America, while pressuring for increased human rights in the process is the only way the United States and re-establishes itself in its own backyard. This statement justifying an opening of relations with Cuba cannot stop at Cuba and the US trade relationship with China.

At the end of the 5th Summit of the Americas, success will only come with a strong arm extending towards an open-hand of diplomacy in the Americas. Obama’s policy towards countries with human rights abuses must be measured and moral in its development of relations that benefit the US and the Americas as a whole.

Click here to see the Reuters Video of Chavez Meeting Obama

Click here to see the Reuters Video of Obama on New Ties with Cuba

This week’s New York Times published a fascinating article about a topic that many experts on Latin America should find very intriguing. The article titled Deals Help China Expand Sway in Latin America by writers Romero and Barrionuevo was an analysis of China’s growing influence in Latin America, with examples of how Chinese liquid investment in many large projects in the Southern Cone and Andean region seek to take American influence via multilateral organisations and FDI and divide the regions investment among the US, EU, China and the rest of Asia.

Since the admitting of China to the WTO and the drastic change in global trade and manufacturing flows, China has become a benefit to some in Latin America and less of a benefit to others. The New York Times article goes into many examples of how Chinese FDI seeks to fund many large projects in the region, from a development fund in Venezuela, to a hydroelectric project in Ecuador and providing Argentina $10 billion in financial loans and Brazil’s national oil company a similar amount to ensure future projects will send a guaranteed percentage of future oil to China. Relations between the US and many of its southern neighbours often have been strained politically in places like Venezuela and Bolivia, or have been tied in with economic restrictions such as Argentina’s relationship with many international financial institutions which set high risks for investment in the country, often funded and controlled by US investment policy within those institutions. For some in Latin America, Chinese investment is not only a good alternative, but can equal the amount invested by the IMF, World Bank and the US itself as noted in the article.

Concern from American officials will likely become greater as China seeks to displace any US and European FDI and by-pass conditions set by many international institutions that often placed Latin American and other developing countries into a position of forced policy measures. Chinese investment, most notably in Sudan and other parts of Africa, Latin America and Asia are starting to become an alternative source of funds for many countries which prefer to receive investment, but do not want conditions on their local policies, namely those which affect human rights and those connected to poverty reduction strategies. A benefit to a country like Argentina, who’s loan defaults in the past has placed it in a position where poor investment ratings still linger from 8 years ago, have received Chinese investment without major sacrifices at this point. However, places like Sudan, who are responsible for one of the largest ignored genocides since Rwanda receive not only Chinese investment in developing their oil industry, but are also suspected of receiving arms which some have connected to human rights violations in Darfur. Investment without any restrictions or a moral compass was not always practised by those in the West; especially during the colonial period, but the international investment community must decide how investment should be dealt with in the future to avoid mass slaughter of innocent communities, whether it be Chinese FDI or from the West.

Investment in Latin America has often been seen in a different light, depending on the attention Latin America has been paid during various American administrations. The Summit of the Americas this weekend comes on the heels of one of those moments in history where Latin America is becoming re-engaged, at least for the first few months of the Obama Presidency until there are added problems in the Middle East once again. The issue often seems not only one of Economics vs. Security, but one of the Americas being seen as one complete investment block/FTAA vs. a source of illegal immigration and narcotics. Often this debate plays out using clear statements of interest, referring to Latin America as a region described as America’s backyard as opposed to statements linking narcotics, illegal immigration and terrorism in much of US media on Latin America. A debate on US policy always accompanies the region, wavering as Latin America fades in and out of their sphere of influence with attention due accordingly. This challenge does have a distinct element however in 2009, as Mexico continues to fight a full scale drug war and continues its very close economic ties to the US, and Cuba and the US opening dialogue between Raul and Fidel Castro and the Obama administration. These issues may keep the US tied to regional policy until those issues lose interest, as has always been the case. Luckily some policies linked with security and partnership often pay off, as Colombians have seen in 2008-2009 and some successes with Plan Colombia and in Mexico with the Merida Initiative, not always a media attention grabber, but long term policy nonetheless.

Likely future Chinese investment may re-ignite the debate on trade with Latin America if it is seen as a major threat. The US must decide in the end where it wishes to develop its trade policy as those in the Americas seek to promote their own investments abroad if the US does not wish to pursue major investment and trade in the Americas. Debates on NAFTA and trade agreements with countries like Colombia must be taken as policies which benefit not only the United States, but the Americas region as a whole. In reality, trade between those countries in South America had on average less than 40% of their trade with the US and a significant amount with the EU and Asia. China has now displaced the EU as the second largest investor. Countries such as Canada, America’s closest trading partner has signed trade agreements beyond NAFTA, with Chile, Costa Rica and are discussing an FTA with Colombia and even the EU. According to writers such as Khanna and Zakaria, the US must consider its role in the Americas as its leader and develop its interests beyond security in the region if it is to maintain investment in a strong United States. China as a matter of investment policy is often not competing in places where the US have established strong investment ties, but in those areas where the US have been absent. The next decade of American policy towards the Americas will likely been discovered in the Summit of the Americas this weekend, determining the viability of a Fortress Americas in future US investment policy.

Fareed Zakaria GPS this past Sunday brought one of the most popular leaders in Latin America to English speaking viewers with an interview with Brazilian President Luiz Inacio “Lula” da Silva. With questions of the economic crisis, oil, relations with Cuba, Venezuela and Bolivia as well as Brazil’s role as one of the world’s largest emerging markets and role as the healthiest economy among the BRIC nations, Lula’s words will likely have an effect beyond Brazil and well beyond Latin America as a whole.

Recent discoveries of oil off the coast of Brazil, technology, industry and the traditional agro-economy in Brazil has taken the country out of economic chaos of the 1990s into a position of becoming the next China or India of the Americas. While Brazil has taken a hit in the latest economic troubles worldwide, Brazil stands out with Canada as the two countries in the Americas where a fracture of the financial system has not been considered an eventual conclusion by its government, experts and media. Despite what some call an overly positive outlook that Lula has on Brazil, the methods and conservative financial regulations which developed from past economic crisis will aid Brazil, and might save it from the worst effects of the economic downturn and gives Lula an interesting position when speaking on the economic crisis. When asked about AIG and the current problems in the US, Lula cited greed as the culprit, and suggested that greed and the culture of greed would always result in a worse situation for Americans and others worldwide, unless something is done to change that reality.

The election of Obama according to Lula comes with the realization that Brazil and the US share a similar characteristic as nations which often are more powerful than their neighbors, and hold the obligation to offer a hand to those who are smaller. His metaphor for the situation comes from his love of boxing, where he suggested that if one is weaker and falls during a match, it is not the weaker one on the floor who should offer his hand to the larger, it is the one who has the power in that situation who should offer his hand, referring to Obama’s opening of dialogue with Cuba and in response to Fareed’s question about how Obama should handle Chavez and his anti-US approach in various speeches and policy options. Lula’s perspective is an interesting one. As an incredibly popular leader who considers himself a socialist, albeit maintains many conservative economic policy reforms, Lula has positioned himself as a powerful diplomatic voice between the divisions between the traditional economic elite and socialist/populist leaders which often create large divisions in most other Latin American countries. His interview on GPS likely is a move towards bringing in closer ties with Obama, while placing Brazil as an intermediary between the US, Bolivia, Venezuela and Cuba and allowing Brazil to become a responsible regional player on the road to becoming an important international economic player. The ability for Lula and Brazil to cross boundaries is not an easy role to assume, but the ideas expressed from its leaders is a promising one, especially if Brazil is to become the mortar holding together the reputation of emerging economies in the near future.

Click here for Fareed Zakaria’s interview with Brazilian President “Lula” da Silva

The state of Latin America has changed a great deal since the start of 2009. The fate of many nations in the region have been affected by recent losses in oil revenues, problems with financial liquidity and questions about the future of populism in recent economic crisis. Economics, while always an issue in the region has also placed many countries in the position to aid in strategy developments abroad regarding international economic worries while others might have voted in placing wheels on economies in decline. Rights and the changing face of some nations remain undetermined, while bloggers and writers at FPA explore many of these issues in weekly blogs.

The first major change in the region was the referendum on term limits in the Venezuelan constitution. With a slight percentage majority, President Hugo Chavez of Venezuela has won his ongoing battle to allow him to reform the Venezuelan Constitution of 1999 and allow the two term limit of office for the Presidency to be extended indefinitely for elected leaders in the country. Supporters of Chavez and the opposition in Venezuela have vigorously debated on the legitimacy of the vote. Many anti-Chavez activists felt that media suppression, threats, and claims of political violence have arisen out of the last years of Chavez’s Presidency since the loss of the last referendum two years ago. Legal debate on the issue has also abounded as democracy in the country has adopted many legal and political characteristics. A history of the term limits and activities by Chavez and the opposition can be seen here.

The new 2009 FPA Blog on Cuba started last month with many interesting and in-depth posts on the world’s most famous island. The attention on Cuba comes with three major events which will affect the country greatly this year. The 50 year anniversary of Castro’s revolution was celebrated by many Cubans this year, but also frowned on by many anti-Castro activists in Cuba and abroad. A great effect as well is the move from Fidel’s rule to that of his brother Raul Castro. With the health and age of Fidel Castro waning slowly over time and Raul taking up positions of full control, the end of Fidel may come about with celebrations this year as well. With Obama and Raul Castro, there has been a slight move towards a thaw between US-Cuban relations. Some polls suggest that many Americans, and even those in Florida’s Cuban expatriate community have also become more open to relations with Cuba, mind you slight developments only have lead to very slight progress at the moment. The year of 2009 may change things permanently in Cuba if these three elements become larger issues this year.

Another intriguing FPA Blog that will have many crossposts with the Latin America blog is the FPA’s Rising Powers blog. Fascinating posts on Latin America’s influence on the globe have been published, focusing on Brazil and with references to Mexico and their relations to other Emerging Markets have taken shape since the beginning of 2009. With blogs on Latin America, Mexico, China Trade, Cuba and Rising Powers all producing great articles, there will be a lot of future coordination between FPA bloggers in the process. Please refer here to FPA’s Rising Powers Blog where blogger Roger Scher takes a look at Brazil as Latin America’s arising giant.

This week brought some ever-growing attention on Mexico. With the decline in commodity prices as well as a sharp decline in consumer spending, the BBC World Service highlighted Felipe Calderon's announcement to add to Mexico's stimulus package and place an additional $150 million US dollars into Mexico's export industries to keep them afloat. America's neighbours were quick to address issues regarding export industries. The Canadian government was able to beat Bush and Obama to the punch by promising US automakers in Canada part of an auto industry support package with conditions in order to keep the 20% of North America's auto industry within Canada's largest province, Ontario and ensure future jobs for the large minority of Ontario's workforce that are linked to autos. Mexico, while promising $150 million to its export industries will likely have a harder time pushing in billions of dollars like its neighbours into one industry. While Mexico in recent years has been a mark of economic stability in Latin America, the recent security situation in Mexico this past year and activities by the US to stop Mexico from becoming the next Drug War has pushed the US to form a smaller version of a Plan Colombia, spending millions on anti-narcotics support and advice for Mexico and Calderon's administration. With the election of Mr. Obama as President comes the realization that he could have inherited one of the worst State of the Union's in American history. The only person who could likely have a tougher job however is Felipe Calderon, as the economic crisis consumes Mexico's well earned reserves and the export oriented economy becomes mired in the future losses of its main export market, one of the worst security situations in Mexican history has come at a time when there is little money to fight it. In addition, many of Mexico's drug cartels have made a point of attacking government officials, killings many top officials and having others being caught in bribery scandals which could leave Calderon with as much security problems as economic. Some positive developments in the last few years may not stop Mexico's worries, but has prepared Mexico with economic policies that might help Mexico and many other Latin American states weather the economic problems with development strategies that would be the envy of the world's economic policy experts. Economic crisis have hit Latin America on average every 10 years since the 1970s and growth in countries such as Mexico and Brazil have placed them in the best position possible in a bad situation. With Mexico's security situation finally coming on America's radar screen in the past month, developments in Mexico in the last few years has likely opened a dialogue with similar neighbours such as Brazil who has had much success in its economic reforms and is poised to weather this economic crisis with stable growth for the future. In a January 7th FT.com article by Nick Rice, Brazil's economic policies in the recent past has not been able to remove Brazil from the global crisis, but has placed it in a good position to weather the storm. Policies enabling Brazil to grow with commodity exports, conservative lending and well run industries has enabled Brazil to take advantage of slow growth rates and shield Brazil from the ills of excess lending and a lack of diversification. While Mexico differs from Brazil due to its close export relationship with the US and its dependence on oil revenues, the formula for economic growth is likely a topic of much dialogue between Mexico, Brazil and the rest of Latin America. With the future of Mexico's security and economy likely to change greatly with the opening of world credit markets, the stabilization of oil prices and assistance from its neighbours in combating drug cartels and addressing issues of economic reforms, leadership, while an almost impossible job, is more important than anytime since the foundation of Mexico as an independent state. Decisions on future policies and a lot of luck are crucial for Obama and Calderon in 2009.

 hacking neopets password software download Buy CODEWARE COMPRESS BUILD 6258 Download

 sales program hud fha appraiser Buy MakeMusic Finale 2008 For Mac (3 Cds) Download

 crossover office cracked download Buy Pixologic ZBrush 2.0 Download

 download miami nights onto cell phone Buy Mercury Winrunner 8.2 (1 Cd) Download

 download air port wep sniffer Buy Symantec Ghost Solution Suite 1.1 (1 Cd) Download

 cost of joining curves fitness program Buy IRIS Readiris Pro 11.5.6 MAC OSX UB Download

 download human grunt Buy Celemony Melodyne Studio Edition 3.2.2.2 For Mac Download

Japan has always maintained a certain level of intrigue for foreigners, especially since the end of the Second World War due to its history, culture, economic progress and people. While Japan stands out as one of the most influential nations of the 20th Century, it has often not been a destination for many immigrants but more of a source for immigrants despite its economic prowess around the globe.

One country that has benefited from Japanese immigration is Brazil. With more than 1.5 million Brazilians with Japanese heritage, it is one of Brazils largest immigrant communities and the source for many Brazilians now moving to Japan. Next to Chinese and Koreans, Brazilians have become the third largest immigrant group in Japan. While many have descendants from Japan originally which produces cultural and legal links with Japan, many Brazilians now coming to live in Japan still require services which are key to Brazilians in the country. With 320,000 Brazilians now having Japanese residency, the concern is that integration in Japanese society make be difficult without asserting social services and education towards the Brazilian community residing in Japan.

One of the greatest concerns is education. In order to produce immigrants in Japan that can grow and work in the country, education for children 5 to 14 years of age is crucial for their future. With 33,000 kids in that age range, only 10,000 are enrolled in Japanese schools, while a further 10,000 are in Brazilian schools in Japan, leaving 10,000 kids not registered in any formal education at all, according to The Japan Times Online. Since 2001, and increase from 45 to 110 Brazilian schools was the result of many kids from Brazil having a tough time with language skills in Japanese, even to the point of being bullied and requiring often non-official school to be opened to accommodate children in the Brazilian community in Japan. While there have been discussions about trying to integrate foreign students into the public school system, the lack of adequate strategies and unfamiliarity in integrating non-Japanese students into the school system is a tough barrier to breach. Ironically, with many of the Brazilians now living in Japan having Japanese heritage, as well as citizenship in Japan due to their heritage, it is likely that the feeling their grandparents had coming to Brazil for the first time as Japanese, is similar to their experience coming to Japan as Brazilians. With Japan slowly becoming multicultural to a slight degree, it is imperative that new Japanese citizens have their needs addressed, often waiting for a paradigm shift in society to meet their needs.

In the last two weeks while markets tumbled, the amount of information about common issues such as poverty, the food crisis and even the economies of otherwise notable countries have also dwindled as American candidates preach of change and the rest of the world deals with economic aftershock. While Europe and the US slowly absorb their financial industries into the public purse, other middle countries and emerging economies deal with the problems and try to seek out the positive aspects of the world's financial capitals plunging into chaos.

Not all countries, even developed ones, are in the same position as their European and American counterparts. In an IMF report published in the second week of October, countries such as Sweden, Australia and Canada were credited with having very stable banking systems with well regulated capitalization requirements and having sturdy foundations to best weather the latest economic storm. Canada stood out as one of the best, influencing their own election for Prime Minister and allowing the fiscally prudent Conservative Party to absorb many opposition party seats despite having a campaign during the financial crisis that is often blamed on incumbent government policy. Since the start of the Canadian election, the Canadian Dollar plunged from 97 cents US to 79 cents US as commodity stocks lost value. With over 87% of Canada's trade going to the commodity hungry US, Canada has taken steps to keep the liquidity in their financial system and even had talks with President Sarkozy of France before his left the meetings of the Francophone to begin talks for a free trade agreement between the EU and Canada. Despite economic turndown and the drop in Canada's currency against the US, trade will likely finally open up to the EU and Latin America in order to keep relatively cash rich Canadian companies in the mindset of investing their "non-losses" into economies overseas. Activities between the EU and the US played out in the same narrative last week as Sarkozy's mission to save capitalism and create a new global economic order, a Bretton Woods II, lead him into talks with Bush in the US to coordinate a common response to the failing markets. Sarko's proactive approach even reached into France's cultural policy, by planning trade talks with Canada while trying to bring ties between Canada's English speaking and French speaking communities closer and maintain stability in the only G8 country which has not plunged into chaos. Stability in some form in the developed world is what the EU and US need, even if not inside those economies themselves. It is likely that while traditional blue chip investments will not maintain their blue chips forever, it is possible that places like Canada and emerging economies may take some benefits with the losses in the global economy.

With so little information about emerging economies coming out of mainstream media in the last two weeks, some interesting dynamics have been playing out in the process. While not a complete paradigm shift, some investment chatter has been moving towards placing money in China and India due to the recent cash rich position of those economies despite recent losses there as well. While today there was a talk of a financial rescue package between China, Japan and South Korean with its ASEAN partners, relatively China is not the worst off in Asia. While the Chinese and Indian economies are highly dependent on the purchase of consumer goods in the US and EU, cash which has been acquired in their recent economic booms will enable cash rich companies in those emerging markets to purchase shares in many failing companies in the EU and US and might place Chinese and Indian companies in a position to not just be on the production end of product development, but also purchase the ability to vertically integrate their industries by way of relatively cash rich Chinese and Indian investors. This new position does not wholly account for the fact that China and Japan own a good size of US debt, and while Tokyo's Nikkei is feeling the crush of the crisis, the 1/3 of US debt owned by China will only spur emerging markets into a relatively better position despite current losses in China and India as a whole. Even the Middle East is feeling some benefits, as the rise in 2007-2008 oil prices have left many producing countries with money to burn despite recent falling oil prices this month. This will be remedied as well as OPEC will be meeting this week and after to curb the fall in global oil prices and maintain oil at the relatively high level despite the losses in the US and EU and falling demand for their products. In the end, Dubai might replace London and New York to become the place to go for the best and brightest coming out of Oxbridge, Yale and Harvard.

An interesting dynamic has also been created in a region, which has veteran experience in dealing with economic crisis. Latin America has always suffered in the past 30 years since the last oil boom and recession in the 1970s due to poor economic policies, schizophrenic investor confidence and pure bad luck. Only recently have countries like Brazil, Venezuela, Argentina and Mexico been able to weather an economic collapse and pay back their past debts. Initially, the realization that the economic storm has finally come from the US and not from their own economic crisis was not being played down to any degree by Latin American leaders. Initially the strong Brazilian and Venezuelan economies lead leaders in those countries to direct concern about the US collapse away from South American markets. While not commonly known, trade between many countries in South America is often less than 40% with the US. While Canada and Mexico have taken measures to re-capitalise with over 85% of their trade being conducted with the US, South American countries believed their trade position, balanced economies, and well earned savings would allow them to be passed over in the latest crisis. With the collapse of the EU and Asian markets, Latin America followed with a 12 percent drop in the Brazilian exchange Bovespa and the biggest drop in Mexico's Bolsa since 2000. Despite this, IMF predictions of growth in the region in 2009 made in April of this year only shifted down slightly from 4.4% to private investor predictions of a growth rate of 3.5% for Latin America as a whole. With many investors putting their funds into the US Dollar for safety reasons, the paradigm shift, that other economies might be seen as safe investments beyond New York, Tokyo, London and Paris might buoy investor confidence in emerging economies and relatively cash rich nations in order to diversify their funds further as investment risks grow at home to the benefit of stable markets abroad. While not all emerging economies will benefit, as in those like Mexico and Russia which have been hit hard despite keeping afloat and massive recapitalisations, markets such as Brazil, India and China might be able to increase confidence in their economies in the long run and balance many diversified portfolios if economic management and legal protections can be ensured in the next few years. While the paradigm shift has not yet occurred, it is evident that a change in the global economy that was going to take another generation has perhaps emerged in the last month. With losses come opportunities, and with nervous investors and bad policies at every turn, only intelligence, patience and luck will determine if change will occur and create a new economic order.