Since 1973 most of the Latin American countries have experienced deterioration in their balance of payments due to the economic recession in the industrial countries and the oil price increases. The consequent adjustment process has called for stricter regulation of domestic demand and new advances in import substitution. Adjustment was less painful due to access to private financing in the international capital markets which, however, produced a sharp increase in the external debt.

This article does not propose to review the recent patterns of external payments, already extensively analyzed in the periodic reports of the UN Economic Commission for Latin America, the International Monetary Fund, and in other studies. Rather, it will attempt to emphasize some long-term changes in the world economy and in Latin America that influence the international participation of the region. It is in this context that the adjustment process of the balance of payments and the external debt should be evaluated.