TRADE ENVIRONMENT IN LATIN AMERICA AND ROLE OF OECD
This research paper discusses recent changes in the level, composition and orientation of the trade of the nations of Latin America (Central and South America, excluding the Caribbean area) and the special role being played recently by the Organisation for Economic Co-operation and Development (OECD) in facilitating that trade expansion. With a number of exceptions, the international, including intra-regional, trade of the principal Latin American nations has expanded during the past decade, reflecting changes in the global economy and the revitalization through structural reform of domestic economies in a number of countries. International financial assistance and private capital flows, primarily direct foreign private investment (FDI), from the developed world have played an important role in improving the trading and balance of payments positions of the major Latin American countries.
OECD has become more involved with Latin America because of rising levels of Western European trade, lending and investment there and the common interest of all the members of OECD in leveling the playing field for FDI in Latin America. OECD is playing an important role in ameliorating the current trade environment in Latin America by persuading governments in the region to remove barriers to further expansion of international trade and development.
Traditional International Trade Environment
During the era of gunboat and dollar diplomacy (the late 19th and early 20th centuries), Latin American nations served as a source of raw materials, minerals and food exports to, and as a market for capital exports, intermediate goods and finished products from the developed world. For Latin America, the period 1913-1945 produced alternating cycles of rapid economic growth and stagnation, decline, the latter being especially sharp during the Great Depression when international trade and interna...