Economic Teams in New Democracies Make Tough Debt Negotiators
Mar. 07, 1986
MEXICO CITY (AP) _ Young, often foreign-trained economists have taken charge of the damaged economies of Latin America - civilians mapping policies where military officers once ruled.
On coming into office with new elected governments, these technocrats confronted a wealth of problems, including heavy foreign debts, high inflation, soaring unemployment, stagnant economic growth and weak export sales.
Most have had only limited success in trying to turn around their economies, but they have been skillful in winning better terms from international bankers on the burdensome foreign debts. The agreements have included longer payment periods, lower interest rates and deferment of principal payments.
''They are very impressive. They are doing very well,'' said Riordan Roett, director of Latin American studies at Johns Hopkins University's School of Advanced International Studies in Washington.
''They are keeping the bankers off balance... They have proven they know how to maneuver,'' he said.
The new economic policymakers carry credentials from colleges in their own countries as well as from Princeton, Harvard, Yale, Georgetown, Wesleyan and European universities.
Before joining the civilian governments, many held positions in private business, at universities or with international financial organizations. Some were politicians. A few also served in the military regimes.
Since becoming bureaucrats, much of their time has been spent grappling with foreign debts. They meet with each other, formally and informally, to talk about their common problem.
Some have sought advice from Mexico's more experienced economic team, which last year signed a $48.7 billion rescheduling package stretching out some debt payments over 14 years. Mexico owes $96.4 billion to foreigners, the second- largest sum in the developing world after Brazil.
The work has paid off at the debt bargaining table.
Ecuador's economic team, led by Finance Minister Francisco Swett, bargained with bankers to extend over a dozen years payments on $5.2 billion of the nation's $7.2 billion debt.
Swett, 39, holds degrees from Princeton and Wesleyan universities, and has worked as a consultant to the World Bank and other international organizations.
His team members in Ecuador, which got rid of its military regime seven years ago, include the central bank director general, Carlos Julio Emmanuel, 42, who graduated from the University of South Carolina and worked for the International Monetary Fund, and Alberto Dahik, 32, another U.S.-trained economist who was an adviser to President Leon Febres-Cordero before being named head of the monetary policy board.
Peru's democratically elected president, Alan Garcia, took office last July and immediately upset the banking world by insisting his government, rather than bankers, would set the terms for repayment of its $14 billion debt.
Helping carry out his plans is economist Luis Alva Castro, 42, who doubles as Peru's prime minister and economics minister. He has been an executive of a number of businesses and active in Garcia's nationalist Aprista Party.
Gustavo Saberbein Chevalier, 40, trained at the University of Grenoble in France, is the government's vice minister for economics. Leonel Figueroa, 42, who studied at the University of Texas, holds the position of vice minister of treasury and heads the nation's Central Reserve Bank.
Brazilian President Jose Sarney's new economic team conducted difficult negotiations with international bankers on the nation's $103 billion debt and gained a 14-month extension on $16 billion in interbank and trade credits.
Heading the team is businessman Dilson Funaro, 52, who was named finance minister in August after his predecessor had a falling-out with Sarney, who took office last March, ending 21 years of military rule.
The Brazilian central bank president, Fernao Bracher, 50, who directed the central bank's foreign dealings under the military, studied at the University of Fribourg in Switzerland and at West Germany's Heidelberg University.
A third member of the team, Planning Minister Joao Sayad, 40, earned a doctorate in economics from Yale and has spent much of his professional life teaching.
Argentina's economics minister, Juan V. Sourrouille, 45, was named to his job in February 1985 in President Raul Alfonsin's civilian government.
He was key in fashioning the drastic Argentine anti-inflation plan that replaced the peso currency with the austral. Argentina has succeeded in slashing inflation from a monthly rate of 30 percent last June to 3.2 percent in December and won praise from the international financial community.
Sourrouille also is conducting negotiations with the International Monetary Fund and private banks to refinance Argentina's $50 billion foreign debt. The Alfonsin government is pushing for a reduction in interest rates charged by its creditors.
The Argentine minister, who holds an economics Ph.D. from the National University of Buenos Aires, did postgraduate work at Harvard.
Uruguay, which returned to democracy last year, refinanced $2 billion of its $4.6 billion debt through the bargaining of Economics Minister Ricardo Zerbino, Central Bank President Ricardo Pascale and Planning Director Ariel Davrieux.
The 47-year-old Zerbino is an economist who resigned his government post when the military took over Uruguay in 1973 and worked as an adviser to private companies and organizations.
Pascale, 43, took finance courses at Georgetown University and was a financial consultant before joining the government. Davrieux, 47, also an economist, studied at the Center of Studies of Economic Programs in Paris.
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