# Latin America: Growth and value for investors, but dilemmas persist

Latin American countries have supported the last financial crisis better than anyone expected considering their history. These countries not only suffered the crisis less than developed countries but they could maintain growth, in part, because of commodities’ demand from China.

It was also useful public spending that helped to compensate the shortfall of private demand in some sectors, but there were many differences between actions taken by governments in Latin America as a whole.

In one hand, Chile had the best countercyclical policy saving most of the extra-income received from copper exports during the best years when global demand was pushing up growth. Brazil also took measures that tend to strengthen domestic demand in order to avoid free fall in the beginning of 2009.

On the other hand, many countries took wrong policies, in my opinion, that implied the lost of credibility and they acted in the opposite direction than the situation required. Venezuela, for example, didn’t take advantage of extraordinary international oil prices and the money was used to nationalize many private companies because there were contrary of Chavez’s thoughts. Argentine took erroneous measures such as nationalization of private pension funds that installed uncertainty between investors and businessmen. Those funds were used in a discretionary manner and didn’t have any effect in supporting local demand. Besides, local government started to manipulate economic statistics, principally inflation, making the scenario more unpredictable.