Chairman of Roubini Global Economic and New York University economist Nouriel Roubini remains sour about U.S. economic prospects, but is enthusiastic about Latin America.
"These countries have shown their own resilience,” Roubini told The Americas Society.
“Their economic policies have been sound.”
Roubini forecasts a regional growth rate of 3.8 percent for 2010.
“Financial conditions remain easy,” he says. “Capital is flowing back to emerging markets.”
Thus far, Roubini notes, Latin America has not directly affected the advanced economies.
“Of course, within Latin America, given the importance and size of Brazil, if Brazil does better than expected, then that can be helpful for Argentina and all the other countries that are trading with Brazil as well,” Roubini observes.
“If oil stays at $80, Venezuela is going to have mediocre growth and avoid financial crisis,” says Roubini.
But he said a massive correction of commodity prices that are important for countries like Ecuador, Venezuela, Bolivia, and Argentina, fiscal problems could be much more severe.
However, “I think that with commodity prices rising and global growth being OK and the regional growth being OK, even those that are not market friendly can avoid severe financial distress.”
In its fourth-quarter inflation report, the Central Bank of Brazil said growth could swell to 5.8 percent in 2010 from near zero this year, The Wall Street Journal reports.
However, the report also forecast a rise in the inflation rate, from 4.3 percent projected this year to 4.6 percent in 2010 and 2011.
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