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Financial Markets

A. Compare and contrast the international financial organizations that play major roles in NAFTA and Latin-American Integration Association (ALADI) regional trading blocs.

b. Analyze the major foreign exchange challenges that exist in NAFTA and the Latin-American Integration Association (ALADI) regional trading blocs.

c. Select an appropriate strategy to manage exchange rate risk for NAFTA and the Latin-American Integration Association (ALADI) regional trading blocs.

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STEP 1
a. Compare and contrast the international financial organizations that play major roles in NAFTA and Latin-American Integration Association (ALADI) regional trading blocs.
The international financial organizations that play major roles in NAFTA are the North American Development Bank and the World Bank Group related to activities of development, the International Association of Insurance Supervisors related to insurance regulation, the International Organization of Securities Commissions - North American Securities Administrators Association, the APEC Finance Ministries, GS Finance Ministers Meetings related to the department of finance and the Bank for International Settlements relating to the central bank.

In contrast the financial organizations active in the ALADI region include the United Nations Economic Commissions for Latin America and the Caribbean (ECLAC), regional institutions like the Latin American Reviews Fund (FLAR). In addition, agencies like the United Nations' Department of Economic and Social Affairs (DESA) are active in the region. Most importantly the IMF is very active in this region. IMF is active in this region because it has large funds that it needs to lend. In addition, IMF imposes certain conditions on the borrowing counties. Finally, IMF takes its decisions to lend after a lot of deliberations and this takes time and involvement. Sometimes the loans are late and are insufficient.

The basic approach towards ALADI is that it is a bloc of developing countries and those financial institutions that are related to development lending like the IMF are active there.
There are some regional financial institutions in the ALADI like ...

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