Economics

Chinese lending to Latin America and the Caribbean nearly triples in 2015

Despite China’s economic slowdown, the Inter-American Dialogue’s Chinese Finance to LAC in 2015 Report indicates Chinese policy banks financed US$29 billion in 2015 to Latin American and Caribbean governments and businesses, up US$19 billion from 2014. The main recipients of funding were Venezuela, Brazil, Ecuador, receiving 95 percent of of total lending to the region. The funds from the China Development Bank (CDB) and the China Export-Import Bank (Eximbank) were focused heavily on infrastructure projects, which ostensibly could assist in moving products (agricultural produce and extractives) from “fields to ports,” easing China’s ability to obtain the resources it needs from its Latin American partners.

Controversy Surrounding the Changes to Minimum Wages in Honduras

During the final weeks of 2013, the Honduran federal government and private sector businesses came to an agreement on minimum wages for the following three years. In 2014, the minimum wage was to be 7.5 percent and 8 percent in 2015 and 2016. However, under this arrangement, these rates were not permanent, but rather subject to inflation. The minimum salary rates would be revised if inflation exceeded 8 percent or fell below 4 percent. While the law appears simple enough and rather concrete, issues are bound to arise if official inflation rates differ from the black market rates. Should minimum wages be revised according to where the Central Bank’s inflation rates fall or according to the black market’s inflation numbers?