LATIN FINANCE MINISTERS HOLD MEETING IN PANAMA AMID BANKING CRISIS

Amid the banking crisis in the United States and Europe, top finance officials in Latin America and Caribbean countries held a meeting in the annual conclave of the Inter-American Development Bank (IDB) in Panama on Saturday (March 18). According to a report by the news agency AFP, Brazilian economist Ilan Goldfajn, the new president of the IDB was supposed to address the governors of 48 countries, most of them finance ministers at 10 pm. However, there is no update on this development yet. The meeting would then continue behind closed doors. 

The conclave started on Thursday, with debates being held on poverty and climate change, and initially, there was no discussion on the banking crisis. Goldfajn said such "cyclical" issues would be addressed in closed-door meetings. 

After American banks suffered their worst week since the 2008 global financial crisis, concerns grew across Latin America and Caribbean countries that the current crisis could spread. 

Speaking to AFP,  Chilean finance minister Mario Marce said that one has to be vigilant as in financial markets, contagion could be very fast. Marce said that prices of raw materials have been falling,  adding, "when raw materials drop, our own currencies are weakened."

IDB President Goldfajn and the Latin and Caribbean ministers, along with non-regional delegates from European nations, have held a series of bilateral and small-group meetings to address such topics. The news agency further reported that Goldfajn also led a meeting with ministers from Amazonian countries to examine ways to finance conservation programs

The banking crisis started when California-based Silicon Valley Bank (SVB) collapsed, prompting the Joe Biden administration to guarantee that all depositors would be safe. As the shock of that move reverberated, Swiss banking authorities separately had to prop up Credit Suisse. 

UBS AG has been mulling a takeover of Credit Suisse which could allay fears that the unfolding crisis at the bank might destabilise the global financial system. Last week, the shares of Credit Suisse lost a quarter of their value. 

(With inputs from agencies)

 

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2023-03-18T18:47:30Z dg43tfdfdgfd