mechanisms (Stallings, 1990. p. 55).
The imbalanced reliance on foreign exchange soon became the guiding force of economic policy in just about every Latin American country. For a multitude of reasons, the many Latin American countries responded with somewhat similar economic and political policies. Severe shortfalls in foreign exchange were addressed by focusing attention on the import side of the economy. Consequently, many large Latin American countries established multiple exchange rate systems intended to subsidize industrial- sector imports at the expense of the traditional export sector. But by the late 1950s it became increasingly evident that this elaborate method of state intervention and industrial subsidy did not solve the foreign trade imbalance. Export revenue stagnated, or in some countries, even fell in the second half of the 1950s and early 1960s, while import needs as a proportion of GDP did not fall quickly enough. Crises in the balance-of-payments equation became routine in many countries, especially
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