Great Recession in South America

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Overview of the impact of the Great Recession in South Africa

Part of a series on the

Great Recession

Major aspects

* Subprime mortgage crisis
* 2000s energy crisis
* 2000s United States housing bubble
* 2000s United States housing market correction
* 2008 financial crisis
* 2008–2010 automotive industry crisis
* Dodd–Frank Wall Street Reform and Consumer Protection Act
* European debt crisis

Causes

* Causes of the European debt crisis
* Causes of the 2000s United States housing bubble
* Credit rating agencies and the subprime crisis
* Government policies and the subprime mortgage crisis

Summit meetings

* 34th G8 summit (July 2008)
* G-20 Washington summit (November 2008)
* APEC Peru (November 2008)
* China–Japan–South Korea trilateral summit (December 2008)
* G-20 London Summit (April 2009)

Government response and policy proposals

* 2008 European Union stimulus plan
* 2008–2009 Keynesian resurgence
* American Recovery and Reinvestment Act of 2009
* Banking (Special Provisions) Act 2008
* Chinese economic stimulus program
* Economic Stimulus Act of 2008
* Emergency Economic Stabilization Act of 2008
* Federal Reserve responses to the subprime crisis
* Government intervention during the subprime mortgage crisis
* Green New Deal
* Housing and Economic Recovery Act of 2008
* National fiscal policy response to the Great Recession
* Regulatory responses to the subprime crisis
* Subprime mortgage crisis solutions debate
* Term Asset-Backed Securities Loan Facility
* Troubled Asset Relief Program

Business failures

* American International Group
* Chrysler
* Citigroup
* Fannie Mae
* Freddie Mac
* General Motors
* Lehman Brothers
* Royal Bank of Scotland Group
* UBS

Regions

* Africa
* Americas
* South America
* United States
* Asia
* Europe
* Oceania

Timeline

* v
* t
* e

The Great Recession in South America, primarily involved disruptions to the bond markets of Brazil, Argentina, Colombia and Venezuela. As most South American countries are commodity exporters, they were not directly affected by the financial turmoil.[1]

The continent experienced a concurrent agricultural crisis in early 2008.[2] Food prices increased due to use of arable land for the production of biofuels. Second generation biofuel processes increased production sustainability, using biomass from inedible parts of food crops, such as stems, leaves and husks.[3] Other non-food crops, such as switchgrass, grass, jatropha, whole crop maize, and miscanthus could be used to produce biofuels without impacting food production.[3] Industry waste products (such as, woodchips, skins and pulp) also replace the need to waste arable land for biofuels.[3] Food prices, rose significantly from 2002, reaching a peak during the first quarter of 2008, with the average food price rising 50% over one year.

Subsequently, South American countries were affected by the global slowdown and decreased food prices from declining demand.[4] In June 2008, the Economic Commission for Latin America and the Caribbean (ECLAC) expected 4% growth for 2009. However, by year end it predicted 2009 would end the six years of prosperity where Latin America benefited from high raw material prices.[5] The region's production was expected to decline and unemployment to increase.[6][7] The Center for Economic and Policy Research emphasised careful macro-economic policies to mitigate damage, with South American countries increasingly independent of the U.S. economy.[8]

## Countries

[edit]

### Brazil

[edit]

See also: List of economic crises in Brazil

Though escaping the early impacts of the Great Recession, Brazil's economy shrank 3.5% in the fourth quarter of 2008, industrial production 17.2% lower in January 2009 than the prior year. GDP grew by 5.1% over 2008. Capital spending fell 9.8% and household consumption by 2% in the fourth quarter.[9] The Wall Street Journal showed a 13.6% drop in gross domestic product in the 4th quarter of 2008 on an annualized rate and industrial production for December 2008 18.6% lower than December 2007, with 700,000 fewer jobs between November 2008 and February 2009.[10]

### Argentina

[edit]

As the second-largest economy in South America and an important exporter of both machinery and agricultural goods, Argentina was affected by the global slowdown. The country saw slower economic growth, a steep drop in commodities prices, and a damaging drought in the farm provinces. Local economists expected recession.[11][12] Former President Néstor Kirchner, husband of then president, Cristina Fernández de Kirchner, leader of the ruling Justicialist Party, gave a speech on February 17 2009, predicting the international crisis would cause Argentina's "most difficult year in the last century."[13]

### Ecuador

[edit]

Ecuador sought to default on sovereign debts incurred under the government of Gustavo Noboa, claiming the debts were incurred illegally.[14] An Ecuador default, would have been the first developing country to default on sovereign debt since the crisis began.[15]

### Caribbean Islands

[edit]

The International Monetary Fund (IMF) reported as soon as February 2008 that a U.S. slowdown would hurt the economies of the Caribbean Islands, especially the Eastern Islands. The tourism sector is a large part of the Islands' economies, and are heavily dependent on U.S. visitors.[16] However, lower inflation and currency depreciation in several Latin American and Caribbean nations may have offset this impact of the Great Recession, stimulating tourism.[17]

## See also

[edit]

* Great Recession in the Americas
* Great Recession in the United States
* Timeline of the Great Recession

## References

[edit]

1. ^ ""Subprime": lejos de A. Latina" (in Spanish). BBC Mundo. August 1, 2007. Archived from the original on 2009-01-13. Retrieved 2010-01-05.
2. ^ Poverty Declines Slightly in Latin America and the Caribbean, in Spite of Global Financial Crisis Archived 2011-07-20 at the Wayback Machine, ECLAC Notes Nº 59 (9 December 2008)
3. ^ a b c Oliver R. Inderwildi, David A. King (2009). "Quo Vadis Biofuels". Energy & Environmental Science. 2 (4): 343. doi:10.1039/b822951c.
4. ^ "Latin America risks reverting progress in poverty reduction / Global financial crisis will affect region's trade with the rest of the world" (PDF). ECLAC. December 2008. Archived (PDF) from the original on 2011-07-20. Retrieved 2010-10-02.
5. ^ "Preliminary overview of the economies of Latin America and the Caribbean 2008". ECLAC. December 2008. Archived from the original on 2011-07-20. Retrieved 2010-10-02.
6. ^ "Growth in Latin America and the Caribbean Is Projected to Be 1.9% in 2009". ECLAC. 18 December 2008. Archived from the original on 20 July 2011. Retrieved 2 October 2010.
7. ^ "Amérique latine : fin de six années de croissance soutenue" (in French). RFI. 2008-12-19. Archived from the original on 2009-02-01. Retrieved 2010-10-02.
8. ^ "South America: Recession Can Be Avoided". CEPR. November 16, 2008. Archived from the original on January 18, 2009. Retrieved October 2, 2010.
9. ^ "Brazil Shrinks 3.5%, Worst Decline in 13 Years" Archived 2009-11-28 at the Wayback Machine, Brazzil, 11 March 2009
10. ^ Regalado, Antonio. Brazil's Economic Outlook Becomes Focus in Political Battle. The Wall Street Journal. 2009-03-28. URL:https://www.wsj.com/articles/SB123792987606830301 Archived 2017-08-10 at the Wayback Machine. Accessed: 2009-03-28. (Archived by WebCite at https://web.archive.org/web/20090328063654/http://online.wsj.com/article/SB123792987606830301.htmlPlease note that the short ("opaque") form of the WebCite URL should be used only in addition to citing the original URL in your bibliographic reference. Alternatively, please use the "transparent" (but very long!) WebCite URL:
11. ^ "Prevén que éste será el peor año económico desde 2002". Buenos Aires, Argentina: La Nacion. Feb 2, 2009. Archived from the original on 2009-02-20. Retrieved 2009-02-19.
12. ^ "Argentina Announces $32 Billion Stimulus Package". Buenos Aires, Argentina: Latin American Herald. Dec 29, 2008. Archived from the original on 2012-06-07. Retrieved 2009-01-19.
13. ^ "Para el ex presidente, el 2009 será "el año más difícil de los últimos cien" y pidió "memoria"". Buenos Aires, Argentina: El Cronista. Feb 19, 2009. Archived from the original on 2009-02-23. Retrieved 2009-02-19.
14. ^ Ecuador renews default threats[dead link‍]
15. ^ "Stratfor.com homepage, December 5, 2008". Archived from the original on September 22, 2012. Retrieved October 2, 2010.
16. ^ "Caribbean islands may be hit by US recession". Property Wire. 13 February 2008. Archived from the original on 15 July 2011. Retrieved 2 October 2010.
17. ^ "Central America and the Caribbean Will Be the Most Affected Subregions By Standstill in Tourism". ECLAC. 23 December 2008. Archived from the original on 20 July 2011. Retrieved 2 October 2010.

* v
* t
* e

Great Recession

By region|

* Africa
* Americas
* United States
* South America
* Asia
* Europe
* Iceland
* Oceania

United States-specific|

* Automotive industry crisis
* California budget crisis
* Housing bubble
* Housing market correction
* Subprime mortgage crisis

Banking losses and fraud|

* Libor scandal
* Tom Hayes
* Société Générale trading loss
* Icesave dispute
* Forex scandal
* Bernie Madoff
* Tom Petters
* Scott W. Rothstein
* Allen Stanford

Government entities|

* Consumer Financial Protection Bureau
* Federal Deposit Insurance Corporation
* Federal Home Loan Banks
* Federal Housing Administration
* Federal Housing Finance Agency
* Federal Housing Finance Board
* Federal Reserve System
* Government National Mortgage Association
* National Asset Management Agency
* Office of Federal Housing Enterprise Oversight
* Office of Financial Stability
* UK Financial Investments

Government policy and spending responses

Banking and finance
stability and reform|

* Banking (Special Provisions) Act 2008
* China–Japan–South Korea trilateral summit
* Commercial Paper Funding Facility
* Dodd–Frank Wall Street Reform and Consumer Protection Act
* Emergency Economic Stabilization Act of 2008
* Irish emergency budget, 2009
* Temporary Liquidity Guarantee Program
* Term Asset-Backed Securities Loan Facility
* Troubled Asset Relief Program
* 2008 United Kingdom bank rescue package

| Bank stress tests|

* EU
* U.S.

|

Stimulus and recovery|

* 2008 European Union stimulus plan
* 2008–2009 Keynesian resurgence
* American Recovery and Reinvestment Act of 2009
* Chinese economic stimulus program
* Economic Stimulus Act of 2008
* Fraud Enforcement and Recovery Act of 2009
* Green New Deal
* Housing and Economic Recovery Act of 2008
* National fiscal policy response to the Great Recession
* Zero interest-rate policy

Government interventions,
rescues, and acquisitions|

* List of banks acquired or bankrupted during the Great Recession

| Non-banking|

* Chrysler
* General Motors

|

Securities involved
and financial markets|

* Auction rate securities
* Collateralized debt obligations
* Collateralized mortgage obligations
* Credit default swaps
* Mortgage-backed securities
* Secondary mortgage market

Social responses|

* Tea Party protests (United States; c. 2009)
* 2009 May Day protests (Europe, Middle East and North Africa, Asia; 2009)
* Arab Spring (MENA; 2010–2012)
* Occupy movement (worldwide; 2011–2012)
* Occupy Wall Street

Related topics|

* 2000s energy crisis
* 2008 Central Asia energy crisis
* Effects of the Great Recession on museums
* Decline of newspapers
* 2007–2008 world food price crisis
* Retail apocalypse

* European debt crisis
* 2008 financial crisis
* List of countries by public debt

* v
* t
* e

South America

Sovereign states|

* Argentina
* Bolivia
* Brazil
* Chile
* Colombia
* Ecuador
* Guyana
* Paraguay
* Peru
* Suriname
* Uruguay
* Venezuela

Dependencies and
other territories

* Falkland Islands
* French Guiana
* South Georgia and the South Sandwich Islands

* v
* t
* e

Great Recession in the Americas

Sovereign
states|

* Antigua and Barbuda
* Argentina
* Bahamas
* Barbados
* Belize
* Bolivia
* Brazil
* Canada
* Chile
* Colombia
* Costa Rica
* Cuba
* Dominica
* Dominican Republic
* Ecuador
* El Salvador
* Grenada
* Guatemala
* Guyana
* Haiti
* Honduras
* Jamaica
* Mexico
* Nicaragua
* Panama
* Paraguay
* Peru
* Saint Kitts and Nevis
* Saint Lucia
* Saint Vincent and the Grenadines
* Suriname
* Trinidad and Tobago
* United States
* Uruguay
* Venezuela

Dependencies
and territories|

* Anguilla
* Aruba
* Bermuda
* Bonaire
* British Virgin Islands
* Cayman Islands
* Curaçao
* Falkland Islands
* French Guiana
* Greenland
* Guadeloupe
* Martinique
* Montserrat
* Puerto Rico
* Saba
* Saint Barthélemy
* Saint Martin
* Saint Pierre and Miquelon
* Sint Eustatius
* Sint Maarten
* South Georgia and the South Sandwich Islands
* Turks and Caicos Islands
* U.S. Virgin Islands

* North America
* Central America
* Caribbean
*   *   *   * South America

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