The Latin American Debt Crisis in Historical Perspective

Abstract

The debt crisis of the 1980s is the most traumatic economic event in Latin America’s economic history. During the “lost decade” that it generated, the region’s1 per capita GDP fell from 112 percent to 98 percent of the world average, and from 34 per cent to 26 percent of that of developed countries (Bértola and Ocampo, 2012, Table 1.1). In terms of its strong adverse effects, the only comparable case is the “lost half-decade” of 1998–2003 which was induced by the sequence of emerging country crises that began in East Asia in 1997. The Great Depression of the 1930s and the recent global financial crises serve as important contrasts, as Latin America performed relatively better on both occasions.