Wint, Alvin G. ; Campbell, Archibald A. ; Barclay, Lou Anne
Author Affiliation, Ana.
Department of Management Studies
FDI and financial sector stabilisation in Jamaica and Latin America
Social and Economic Studies
Date of Publication
This paper examines the role of foreign direct investments (FDI) in the stabilisation of financial sectors in Latin America and the Caribbean (LAC), with special reference to foreign investment and financial sector stabilsation in Jamaica. Much of the literature on foreign direct investment and development has examined its costs and benefits, particularly in relation to the impact of different types of FDI on development. This study continued that tradition by focusing on the role of FDI in economic stabilisation, which is a particularly important element in the developing process for the countries of the LAC region, many of which have struggled for many years with levels of economic instability. The study concluded that foreign direct investment has played an important role in assisting countries within the region emerge from financial sector crises by improving micro-economic efficiencies, largely through the adoption of international prudential and operating standards. At the same time, improved micro-economic effciency as financial sectors in many LAC countries have yet to see significant improvements in the cost and availability of credit or th narrowing of intermediation spreads.....