Abstract

I believe that my role is to bring the perspective of the Latin American experience into the discussion, and I have a good deal to say about its most relevant aspects; namely, the vital importance of external factors in the crisis, both in the upturn as well as in the downturn; the expansionary fiscal policies that could not be sustained; the absence of sufficient pragmatism to appreciate the adaptations required in traditional policies to make them more effective; the inappropriate timing of certain policies; the unexpected consequences of others; the case (and there is at least one) where the traditional indicators of good economic behavior—fiscal balance, domestic credit, and reserves—were all showing results that gained the praise of many observers while in reality overwhelming imbalances were building up in the economy and finally brought on disaster. The next issue of the Journal of Development Planning, which I have been invited to edit, will review some of the experiences in Latin America, and in Africa, as analyzed by distinguished economists from all over the world.