During the past three years, the U.S. housing market has collapsed. The U.S. government has had to bail out financial institutions and much of the auto industry. And U.S. unemployment has skyrocketed.
But during that same time period, not one bank has failed in Latin America.
“For the first time, we have a crisis of this magnitude that didn’t originate in Latin America,” said Leonel Fernández, president of the Dominican Republic, while speaking at GW’s Jack Morton Auditorium Tuesday.
But just because there’s not a financial crisis in Latin America, doesn’t mean there hasn’t been an impact from the global economic crisis.
“The impact has been basically on trade. There has been a decrease in exports and a decrease in imports and because of that there has been a loss of revenue for governments. And this has translated into a fiscal deficit,” said President Fernández.
President Fernández spoke about the global economic crisis and its impact on Latin America to over 250 GW students, faculty, administrators, alumni and area professionals.
In the speech, he commended President Barack Obama for his strategy for rebuilding the U.S. economy.
“We are still in a very slow weak recovery. You cannot cut spending because then you will increase inflation. You have to make the economy grow. Once you make the economy stronger, then we deal with the fiscal deficit and the debt,” said President Fernández.
Last year during a visit to the Dominican Republic, GW President Steven Knapp discussed areas where GW could collaborate with the Dominican Republic.
“Since then the partnerships between George Washington and Dominican institutions have continued to develop,” said President Knapp.
Last year, GW’s Graduate School of Political Management established a partnership with the Fundación Global Democracia y Desarrollo to offer seminars in political campaign management in Santo Domingo. Several faculty members from GW’s School of Business are working with the Dominican Sustainable Tourism Alliance to boost the country’s tourism industry. And GW’s School of Medicine and Health Sciences is working with Dominican public health officials to fight tropical diseases in the Caribbean region.
“This is very helpful for the Dominican Republic in terms of having a modern outlook on these different areas and having a collaborative partnership with GW,” said President Fernández, who was first elected president in 1996.
During his first four-year term, he implemented economic reforms that brought the country an average growth rate of 7 percent – the highest in Latin America at the time.
President Fernández also spoke about the recovery efforts taking place in Haiti six months after the devastating earthquake.
“Haiti was already the poorest country in Latin America before the earthquake took place, and now the earthquake has only aggravated the situation,” he said.
President Fernández said he believes it will take at least 10 years for Haiti to recover, and it will cost $10 billion.
“It is not going back to where Haiti was before the earthquake. A full recovery will be creating a more vibrant economy, a more modernized nation, a nation integrated into the world economy, a better educated population and having access to health care, water supply and electricity,” he said. “All of this takes time.”
But one of the reasons Haiti hasn’t had real progress in its recovery efforts is because only about 10 percent of what the international community has committed to Haiti has actually been delivered, said President Fernández.
“But we feel hopeful that the situation will evolve positively,” he said.
President Fernández also talked about the history of democracy in Latin America. He argued that Latin America countries need to find a balance between having a more market-oriented democracy and a state-centric democracy.
“You cannot work with either extreme. In Latin America in the 21st century, we have to go beyond neoliberalism, and we have to go beyond populism,” he said. “We have to find a new formula that will combine state and market.”
A day after meeting with President Obama, President Fernández talked about the relationship between the U.S. and Latin America.
Latin America and the U.S. do more than $250 billion worth of business yearly. About 41 million Latinos live in the U.S., which is 15 percent of the U.S. population.
“And the Dominican Republic has become the most important country exporting major league baseball players to the U.S.,” he said. “I hope that Ubaldo Jiménez wins for the National League in the All Star game.”