The Miami Herald
March 19, 2001

 Latins expect minor repercussions from slowdown

 But meeting of economic experts in Chile faces protests


 SANTIAGO, Chile -- The world's major economies are struggling and social protests in Latin America are gathering strength, but the captains of banking and finance have
 come to Chile's capital to celebrate another year of the free-market revolution that has transformed the region.

 The occasion -- amid lavish parties thrown by investment bankers -- is the annual meeting of the Inter-American Development Bank, opening today.

 Buoyed by the conviction that the Latin economies, many of them poster children for the deregulation and trade liberalization preached by Washington, have strong
 structures, finance chiefs predict only minor repercussions from an economic slowdown in the United States, Japan and the financial crisis in Argentina.

 ``The economic outlook is currently based on a 3.5 percent estimate for growth for the region,'' said Enrique Iglesias, president of the Inter-American Development Bank.
 ``But we are dependent on what happens in the rest of the world, the international circumstances, which are complex and problematic.''

 The development bank -- supported by contributions from Canada, the United States and countries in Latin America and the Caribbean -- has come under attack from
 critics, who charge its approach is a recipe for increasing inequality between rich and poor.

 Others charge the bank lends too much to the wealthier Latin countries, which end up in tight financial straits, instead of extending more loans to the poorer nations.

 Human rights activists have staged several marches protesting policies handed down by multilateral lending institutions in Washington. Although Chilean riot police have
 blocked marchers from nearing the ornate Mapocho cultural and convention center where the activities are taking place, protesters have scheduled another demonstration
 aimed at today's opening meeting.

 Iglesias acknowledged the critics, noting that besides assessing the current economic situation and the bank's performance, representatives would discuss the role of
 multilateral lending institutions in directing economies and development.

 Other leaders of global economic policy dismissed the charges of critics.

 ``Obviously as a representative of the International Monetary Fund, I don't agree,'' said Eduardo Aninat, deputy managing director of the Fund, the multilateral agency
 overseeing economic policy in the developing world.

 ``The Fund has often been the scapegoat,'' said Aninat, who formerly headed Chile's Finance Ministry.

 ``Thanks to the support of the World Bank, the Inter-American Development Bank and the International Monetary Fund itself, Latin America could at last grow in the 1990s
 at rates that were very different from the very mediocre rates in the 1970s and in the 1980s.''

 In the past 10 years, Latin America has become a focus for global business, with billions flowing to support growth in energy, telecommunications and new manufacturing.

 In the hallways, the chief discussion is Argentina, which faces a possible break-up of its ruling coalition after new Finance Minister Ricardo López Murphy announced a
 tough new austerity program Friday night.

 Top officials publicly deny the possibility of a devaluation of the Argentine currency or a default on the government's $125 billion debt, but both possibilities are on the
 minds of bankers and investors in Santiago for the bank meeting.

 Early Sunday, former Argentine Economics Minister Domingo Cavallo abruptly left the gathering in Santiago, where he was supposed to meet with telecommunications
 executives, and headed back to Buenos Aires for talks with President Fernando de la Rúa.

 The Argentine president is expected to announce that Cavallo will join his government as chief of the Cabinet in an attempt to shore up domestic and international support
 for the latest belt-tightening.

 López Murphy and Cavallo are expected to be in Santiago today to promote the measures.

 Santiago has been a frenzy of activity since Wednesday, with more than 6,000 commercial bankers, financial analysts, bank employees, journalists and support staff on
 hand for the three-day meeting.

 The Grupo Santander Central Hispano, a Spanish financial group that has bank holdings throughout Latin America, hosted a dinner for participants at the Castillo Hidalgo,
 a 19th Century fortress on a hilltop in downtown Santiago.

 Serenaded by the Santiago Symphony Orchestra and entertained by indigenous dancers, hundreds of international bankers and members of Chile's finance community
 dined on finger-size shrimp, crab claws, platters of oysters and thick Chilean steaks.

 Credit Suisse, the investment bank, tonight brings in the Gypsy Kings for their bash.

 Topics at bank seminars have included improving circumstances for women in the workplace in Latin America to a daylong meeting Sunday addressing what is hampering
 economic growth in the region.

                                    © 2001