Despite poverty, optimism high for growth
Posted on Fri, Sep. 21, 2007 - Miami Herald

BY JACQUELINE CHARLES jcharles@MiamiHerald.com

CORAL GABLES, FL - Fri Sept 21, 207 -- While the widening income gap is creating an unequal distribution of wealth throughout the world, there are some positive signs in Latin America that give rise to optimism, said the head of one of the hemisphere's leading government-lending institutions.

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Audience members listen to Luis Alberto Moreno, president of the Inter-American Development Bank, at The Miami Herald Americas Conference at the Biltmore Hotel in Coral Gables.
PATRICK FARRELL / MIAMI HERALD STAFF

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Audience members listen to Luis Alberto Moreno, president of the Inter-American Development Bank, at The Miami Herald Americas Conference at the Biltmore Hotel in Coral Gables.

''There is something happening, that is not your traditional growth,'' Luis Alberto Moreno, president of the Inter-American Development Bank, said Friday at The Miami Herald Americas Conference. ``I really believe that there is basis for a little optimism.''

Among the reasons to be optimistic is that Latin American economies are growing on average at 4.5 percent a year; the South American economies are all doing really well; and government reserves throughout the region, held in central banks, are larger than they were a decade earlier.

''Brazil has 260 percent more reserves than 10 years ago,'' Moreno said.

Though some are concern that a worsening in the U.S. housing market could mean bad news for Latin America nations, Moreno said he believes the region will still fare well. The challenge, he said, is for countries to sustain the progress they are making, including keeping inflation low.

Despite the progress, it doesn't mean the region's poverty and income gap crisis will go away. There are 205 million people in Latin Amerca who are living in poverty and 79 million living in extreme poverty.

''They will not disappear,'' Moreno said. ``You've got to mobilize all sectors in society. That is a fundamental issue for people to invest back in Latin American societies. And I find where I go, people really want to do something about this.''

But a key to closing the poverty gap in the region will be for governments to continue to make investments in roads, sanitation, water and education while providing the region's poor with more access to finance, he said.