IMF Conference

Francisco de Paula Gutiérrez, President, Central Bank, Costa Rica

Murilo Portugal, Deputy Managing Director, IMF

The increased regionalization and—more recently—internationalization of financial activities in Central America has been a positive development toward improving access to financial services, reducing funding costs, and allowing for a diversification of risks across markets. However, cross-border financial integration raises new challenges for regulation and supervision. Therefore, the Central American Council of Superintendents of Banks and Other Financial Institutions has embarked on a project to design a regional consolidated supervision framework to better monitor and control risks associated with activities carried out by financial institutions with regional operations. This session will review this project’s progress and identify next steps.

Chair: Luz María Serpas de Portillo, President, Central American Monetary Council and President, Central Bank, El Salvador

Speakers:

Rafael Camilo, President, Central American Council of Superintendents of Banks and Other Financial Institutions, and Superintendent of Banks, the Dominican Republic

Jorge Cayazzo, Senior Financial Sector Expert, Monetary and Capital Markets Department, IMF

Commentators:

María Antonieta de Bonilla, President, Central Bank, Guatemala (invited)

Antenor Rosales, President, Central Bank, Nicaragua (invited)

Olegario Barrelier, Superintendent of Banks, Panama (invited)

• Discussion

Private securities markets in Central America are still very small, reflecting in part the corporate sector’s unwillingness to share control or disclose information, the legal and regulatory framework, shortcomings in the public issuance approval process, and the level of development of the institutional investor base. In line with other small emerging economies, there are also high scale-related information costs. This session will highlight some of the major obstacles and present possible reform options, including the scope for a regional approach to the development of private equity and debt markets.

Chair: Héctor Manuel Valdez Albizu, President, Central Bank,  Dominican Republic (invited)

Speakers:

Hemant Shah, Deputy Division Chief, Monetary and Capital Markets Department, IMF

Commentator:

Héctor Alexander, Minister of Economy and Finance, Panama (invited)

To be announced, Superintendent of Securities and Exchanges

• Discussion

Benefiting from the financial support of the Government of Spain, a number of regional projects were launched in 2006, in support of cooperation among the Central American countries. This session will review the progress of these projects, identify next steps, and initiate a discussion on the future financing of the subaccount.

Chair: Gabriela Núñez de Reyes, President, Central Bank, Honduras (invited)

Speakers:

Luis Breuer, Deputy Division Chief, Western Hemisphere Department, IMF

Ramón Guzmán, Alternate Executive Director, IMF

The implementation of CAFTA-DR, the planned establishment of a Central American customs union, and a potential Association Agreement with the European Union will provide benefits to the region in the form of increased trade and higher sustainable growth, which in turn are paramount to reducing poverty. However, from a fiscal policy and administrative point of view, increased integration also presents a number of challenges. Therefore, the Central American Committee of Finance Ministers has initiated a number of projects to safeguard revenue bases and strengthen specific aspects of tax revenue collection. This session will review these initiatives and identify next steps.

Chair: Murilo Portugal, Deputy Managing Director, IMF

Speakers:

Vicente Bengoa, President, Central American Committee of Finance Ministers and Secretary of Finance, Dominican Republic—Tax Coordination

Guillermo Zúñiga, Minister of Finance, Costa Rica—The Customs Union and its Fiscal Aspects

Commentator:

Juan Alberto Fuentes, Director, Central American Institute for Fiscal Studies (invited)

Adrienne Cheasty, Senior Advisor, Fiscal Affairs Department, IMF

• Discussion

Confronting high levels of poverty and income inequality remains a challenge for the Central American countries, which figures prominently in the policy agenda of all governments in the region. While income distribution outcomes are, fundamentally, a function of the historical and geographic distribution of productive resources and their rates of return, public policies can affect this distribution. This session focuses on the redistributive impact of taxation and social spending in Central America.

Chair: William Hándal, Minister of Finance, El Salvador (invited)

Speakers:

Dominique Desruelle, Division Chief, and Ivanna Vladkova, Economist, Western Hemisphere Department, IMF

Commentators:

Hugo Beteta, Minister of Finance, Guatemala (invited)

Hugo Castillo Aldana, Vice-Minister of Finance, Honduras (invited)

• Discussion

Luz María Serpas de Portillo, President, Central American Monetary Council and Central Bank, El Salvador

David Robinson, Deputy Director, Western Hemisphere Department, IMF

Murilo Portugal, Deputy Managing Director, IMF

Luz María Serpas de Portillo, President, Central American Monetary Council and President, Central Bank

Francisco de Paula Gutiérrez, President, Central Bank, Costa Rica

Vicente Bengoa, President, Central America Committee of Finance Ministers and Secretary of Finance

Rafael Camilo, President, Central American Council of Superintendents of Banks and Other Financial Institutions, and Superintendent of Banks