WEF: Chile leads Latin America in financial development ranking
Published: October 27, 2008
Chile was ranked as number 30 out of 52 countries evaluated in the first Financial Development Report issued by the World Economic Forum.
Chile held the top spot among the region's countries, followed by Panama (32), Brazil (40), and Mexico (43). The United States led the ranking, followed by the United Kingdom, Germany, Japan, and Canada.
Chile received an overall score of 3.8 on a scale of one to seven. Its top scores were in policies and institutions. Likewise, institutional climate was ranked at 21 for financial liberalization and business environment was in the 22 spot. The study states that the liberalization of Chile's economy, plus a proper regulatory and legal framework, has been essential in its economic development and the success of the financial system.
Within the regulatory framework mentioned in the study, the effectiveness of corporate governance, as well as the country's stock exchange system were highlighted. In addition, having few regulations in general was identified as being a key factor in this area's success.
Weak points include financial intermediation of banks (30), due to problems with access barriers and poor efficiency. Financial markets were ranked at 40th, with poor performance in derivatives markets. Non-bank financial intermediation was held the 44 spot because of poor showing in mergers, acquisitions, and stock exchange openings. Capital market size, depth, and access held spot number 35.
Source: www.weforum.org