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Source: www.asofondos.org.co
The fifth version of the FIAP-ASOFONDOS International Congress ended last April 27, 2012.
Jorge Sicilia, the Senior Economist of BBVA Research, and Luis Oganes, Chief of Research for Latin America of J.P. Morgan, spoke in the first session “The economy at different speeds: perspectives for Europe and Latin America.”
Jorge Sicilia forecasts a recession in Europe due to the debt crisis, which will only be overcome with drastic measures. In the first place, Europe must work on the elimination of the sovereign solvency risks (especially Greece and Portugal), thus avoiding the contamination of solvent but less liquid countries. Secondly, growth orientated reforms must be implemented; and finally, the monetary union must be strengthened in order to prevent further crises.
Nonetheless, according to Luis Oganes, despite the fact that the global economy is decelerating, domestic demand in 2012 was the driving force of economic growth in Latin America. Added to the above were low inflationary pressures and the large accumulation of international reserves. Although these reserves are not cheap to maintain, the Central Banks have learnt from the recent crisis that having them is a good way to ward off future economic crises and live through them in better shape.
For further details on the declarations of the speakers in the first session, kindly download Press Release No. 4, issued by ASOFONDOS, at the foot of this page.
The second session denominated “Other visions of social and economic development in Latin America” followed, with an initial speech by James A. Robinson, a Harvard University professor, on the subject “Why do nations fail? The origins of power, prosperity and poverty.” He explained how Colombia has developed its economy, based on its political and social history since colonial times. He also pointed out that the historical differences in the economic and political institutions of nations are rooted in their past. For further details on this subject, kindly download Press Release No. 5, issued by ASOFONDOS, at the foot of this page.
In the third session, denominated “Growth and Economic Cycles,” Edward C. Prescott, the winner of the 2004 Nobel Prize for Economics, spoke on the subject “Economic Cycles and Financial Crises: a long-term analysis.” Prescott had an optimistic outlook for South American countries such as Brazil, Chile and Peru. He said that the key for this being the century of the region lay in the savings and investments of the economies of the countries in the region. He said that greater life expectancy should be seen as an opportunity for increasing savings levels and that it is crucial to reduce the informality rate, which in Colombia is still very high.
Finally, at the end of the Congress, the president of ASOFONDOS, Santiago Montenegro, said that this is the precise moment for the current generation to take the necessary measures to ensure that future generations will not be left with the double task of paying the pension liabilities of previous generations and being forced to save to cover their own old age risks. Montenegro reaffirmed the vision of the AFP Trade Association of moving toward a universal, transparent and sustainable pension system as part of a solid commitment to future generations. Montenegro also highlighted the benefits that the individual savings system has brought to nearly 10 million members whose savings have yielded a historical return of 10%, providing protection in old age now and in the future.
In the closing session, the President of the Republic of Colombia, Juan Manuel Santos Calderón, announced the launching of the Regular Solidarity Economic Benefits (BEPS) in the second half of 2012, which will benefit 9 million people who currently earn less than the minimum wage and are unable to accumulate savings for protection in old age. The President also announced his government’s intention of submitting a pension reform project to increase coverage, guarantee greater equity and eliminate the special regimes and privileges of the few.
Archivos Descargables
Download Press Release No. 4 here (only in spanish)
Download Press Release No. 5 here (only in spanish)
