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Debt, Macro Policy and State Intervention: The Next Phase for Latin America*

Published online by Cambridge University Press:  02 January 2018

William R. Cline
William R. Cline*
Affiliation:
Institute for International Economics, Washington, DC
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Extract

In 1982-83 Latin America experienced a depression which rivaled that of the 1930s. Real Gross Domestic Product (GDP) declined by 1% in 1982 and by 3.3% in 1983. Per capita income fell 10% below 1980 levels. The proximate cause of this depression was the crisis produced by external debt.

By 1984 several countries in the region began to show signs of recovery from the severe recession and external-sector crisis. Economic growth rebounded to 2%, and the larger countries achieved impressive improvements in external balances. Brazil's total exports grew sharply, as did Mexico's non-oil exports. In 1985 growth has surged ahead in Brazil and Mexico although falling commodity prices have placed new strains on the smaller countries (and weaker oil prices, as well as erosion in domestic policy, have undermined Mexico's external position).

Type
Research Article
Information
Journal of Interamerican Studies and World Affairs , Volume 27 , Issue 4 , Winter 1985 , pp. 155 - 172
Copyright
Copyright © University of Miami 1985

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Footnotes

*

An early version of this paper was prepared for the 14th Regular Meeting of the General Assembly of the Latin American Association of Development Financing Institutions, Fortaleza, Brazil, 14-18 May, 1984.

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