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Latin America seeks to facilitate trade to reduce inflation

The presidents of eleven Latin American and Caribbean countries pledged on Wednesday to make progress in establishing facilities to improve trade and thus reduce inflation that has become a headache for some countries in the region.

During the first meeting of the Alliance of Latin American and Caribbean Countries against inflation that was held virtually and privately, they promised to advance in the definition of commercial, financial and logistical facilities to ensure that the exchange of products of the basic basket and intermediate goods are in better conditions to lower costs, according to a presidential statement released on Wednesday by the Ministry of Foreign Affairs of Mexico.

This was agreed upon by the rulers and representatives of Argentina, Belize, Bolivia, Brazil, Chile, Colombia, Cuba, Honduras, Mexico, Venezuela, and Saint Vincent and the Grenadines.

Although many countries in the region managed from the second half of 2022 to contain the inflationary pressures generated as a result of the Russian invasion of Ukraine -with the exception of Venezuela, Argentina, Cuba, Haiti and Suriname-, the escalation of prices continues to be a constant concern for the governments and central banks of the region due to the serious consequences left by the crisis.

The impact has been felt especially among the majority poor sectors and the middle class, acknowledged at the beginning of the year the Economic Commission for Latin America and the Caribbean of the United Nations (Cepal). According to their figures, the region faced 15.4% inflation in 2022, and it is expected that this year it will be well below that rate.

As part of the logistics facilities, the adoption of measures will be sought to improve the entry and exit of products through ports and borders and the exchange of intermediate inputs, machinery and technologies, especially in the agricultural sector.

Likewise, it was agreed to create three technical working groups with government representatives to define the measures. In financial matters, it was decided to work to promote access to international credit and increase financing from multilateral organizations for agricultural, agro-industrial and infrastructure projects for the transport of goods.

The Mexican Foreign Minister, Marcelo Ebrard, said on his Twitter account that between May 6 and 7 it is expected to exhibit the products and the first results of the new group promoted by the Mexican president, Andrés Manuel López Obrador, who since he came to government in 2018 it has promoted a greater alliance between the countries of the region.

On behalf of Colombia, the Minister of Commerce and Industry, Germán Umaña, intervened, who agreed on the need to create a “common bag for the least favored sectors” as part of a short-term solution for the region, as detailed by the Presidency in a statement.

Umaña also agreed to create clearing and payment systems “to be able to carry out this commercial exchange in a different way than we do with the domain of hard currencies.”

Source: VOA Español

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