Mexico's Carstens: EMU Far More Complex Than Past Debt Crises
WASHINGTON (MNI) - Mexican Central Bank Governor Agustin Carstens Saturday said contagion makes the Eurozone's sovereign debt crisis "far more complex" than those of individual countries or the many debt struggles of Latin American nations in the past.
Carstens said Latin America's many country defaults in the latter half of the 20th century "gave us a very important richness of knowledge of what generates crises and how to solve them."
But "the situation in Europe is far more complex than the individual case in any country," because the common currency means "the problem of one country can become the problem of the whole union."
Carstens, in a conference organized by the Bank of France, said the most "immediate task" to combat contagion is to "anchor" market expecations with a convincing macro-economic policy response.
If Europe can succeed in establishing "credible macro-economic policy adjustment," then the "dynamics of the market changes from vicious circumstance to a virtuous circle," he said.
** MNI Washington Bureau: 202-371-2121 **