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Report: China, Brazil are fueling world economy's growth

New economic reports released Wednesday show that Latin America and the East Asian Tigers are lifting the world economic tide, showing more resilience to the global economic crisis than the United States and many European nations.

Such a growth path is a break from the past for Latin American and Caribbean countries, which have had a "history of frequent and devastating financial crises," the World Bank said in a report called The New Face of Latin America and the Caribbean.

In another economic report released Wednesday, the International Monetary Fund predicted the world economy will expand 4.8 percent this year and 4.2 percent next year.

But it is China and other emerging nations such as Brazil that are leading the way. The IMF forecast Chinese growth at 10.5 percent this year and 9.6 percent next year. Brazil's economy is expected to chug along at 7.5 percent this year before slowing to 4.1 percent growth in 2011.

Meanwhile, the IMF predicts 2.6 percent growth this year for the United States -- a weak performance coming after a recession -- and 2.3 percent growth in 2011. As recently as July, the IMF had predicted U.S. growth at 3 percent. But the U.S. economy slumped in late spring and summer after fears that the European debt crisis would spread rattled investors and businesses.

Growth is expected to be even slower in the Euro Zone where the IMF forecasts the average economic growth among the 16 nations that use the euro as their currency will be 1.7 percent this year and 1.5 percent next year.

The keys to the newfound resiliency of the Latin American and Caribbean region were more sound monetary policies and better debt and fiscal management, the World Bank said.

But a growing connection to emerging Asian economies -- especially for South American countries, Costa Rica and Panama -- and the region's evolution from a net debtor to a net creditor to the rest of the world were also big factors.

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