THE late Carlos Fuentes, a Mexican writer, compared the exercise of mutual influence between Spain and its former colonies to “a mirror: looking from the Americas to the Mediterranean, and back”. Those transatlantic reflections continue—and reach far across Mare Nostrum—in ways that would have seemed surprising only a few years ago.
Seen from Latin America, the agonies of the euro zone arouse a sickening sense of déjà vu. The limits on withdrawals from Greek banks mimic the corralito (“little fence”) imposed by Domingo Cavallo, Argentina’s finance minister in 2001, in a doomed attempt to preserve his country’s currency board, which pegged the peso at par to the dollar for a decade.
Argentina is Exhibit A for those who argue that Greece would be better off outside the euro. Denunciations of austerity and the IMF by Alexis Tsipras, Greece’s prime minister, and his far-left Syriza party attract the sympathy of Latin America’s leftist-populist leaders. Yet the parallel is somewhat misleading: Argentina recovered strongly from 2003 onwards not just because it defaulted and devalued but because world prices for its...
from The Economist: The Americas http://ift.tt/1GookwY
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