Tatiana Didier

Emerging Issues in Financial Development : Lessons from Latin America

Since the 1990s, financial systems around the world, and especially those in developing countries, have gained in soundness, depth, and diversity, prompted in part by a series of financial sector and macroeconomic reforms aimed at fostering a market-driven economy in which finance plays a central role. Latin America and the Caribbean (LAC) has been one of the regions at the forefront of these changes, and it serves as a good laboratory for seeing where the challenges in financial development lie. The progress in financial development in LAC no doubt reflects governments substantial efforts to provide an enabling environment. This includes lower macroeconomic volatility, more independent and better anchored currencies, increased financial liberalization, lower currency mismatches and foreign debt exposures, enhanced effectiveness of regulation and supervision, and notable improvements in the underlying market infrastructure. This book studies the recent history of financial sector development and reforms in the LAC region and compares it to other developing and developed countries to shed light on the key obstacles to financial development, both past and future. This study is particularly timely in the wake of the global financial crisis that began in 2008, as assumptions about the underpinnings of efficient and well-functioning markets undergo close scrutiny. This book builds on and complements several overview studies on financial development both in LAC and in the developing world more broadly that have been published in the past decade, including those by the World Bank. It covers additional aspects of the financial development process and focuses on the broader set of LAC countries. The chapters in this book cover different issues related to financial development in LAC. Chapters one through five attempt to ascertain where the regions financial development lies, analyzing in detail some of the reasons and policy implications underlying its gaps in banking depth and equity liquidity, as well as the links between financial development and financial globalization. Chapters six and seven consider two themes that are central to the regions financial development: long-term finance and the role of the state in risk bearing. Chapters eight through eleven deal with regulation and supervision, first taking stock of the progress in the region and then analyzing the challenges LAC faces on three main facets of systemic oversight: macro prudential policy, micro systemic regulation, and systemic supervision.

América Latina y el ascenso del Sur: Nuevas prioridades en un mundo cambiante

“Entre la última década del siglo pasado y la primera década del siglo XXI, la participación del Sur en la economía mundial se duplicó, de 20 a 40 por ciento del PIB global. Sin embargo, este excelente informe advierte que los logros de aquel cambio trascendental no han sido compartidos por igual en los países del Sur. El informe destaca, a mi entender de forma correcta, que las debilidades de larga data de la región de América Latina y el Caribe, asociadas con bajas tasas de ahorro y mercados laborales distorsionados, le impiden beneficiarse plenamente del ascenso del Sur. La implicación es clara: si en las décadas que vienen esta región del mundo se propone no quedar rezagada en la economía mundial, debe ir más allá de una mejor gestión macroeconómica”.