The Center hosted the Latin American Shadow Financial Regulatory Committee as they discussed access to credit in the region and made recommendations on the subject. The Committee is a group of former finance ministers and heads of central banks who are authorities on financial issues. Prior to this, the group had two days of closed meetings followed by a public announcement of their findings at the Brookings Institution.
Click here to read a transcript of the event.
Download the statement produced from the Latin American Shadow Financial Committe's meeting.
For more information on committee members, visit www.claaf.org
Millions of Latin Americans lack access to formal jobs. Small and medium sized enterprises (SMEs) are a major source of employment – up to 50% of formal sector jobs in
The Latin American Shadow Financial Regulatory Committee (LASFRC) applauded the dramatic improvements in banking regulation and supervision that have increased credibility and stability in Latin American financial systems. But according to Committee president Liliana Rojas Suarez, “Regional financial institutions, markets and instruments have simply not caught up – we have better banks but too little lending.”
In their statement the Committee argues that SMEs are particularly hard hit by the combination of strict standards for bank lending and weak institutions and markets. Due to their nature, SMEs worldwide have a higher failure rate than larger firms, are very diverse so hard to rate as a group, and often lack sufficient collateral. In
In light of this, the Committee has six recommendations to improve SME financing.