As 2002 came to a close, an audible sigh of relief wafted through the Latin American cross-border market. By all accounts, it was an appalling year for securitizations. Cross-border volume from the region shrank a dismal 43% to US$3.9 billion, according to Moody's Investors Service. Argentina's cataclysmic default in December 2001 and Brazil's election season were the major drags.

But fear wasn't the only factor sucking the oxygen from the foreign currency arena. Competitive domestic markets came into their own, with brisk action in Mexico, Chile and Colombia, despite the successive shock waves from Argentina and Brazil (see Table 4). Local currency securitizations edged up 13% to US$1.7 billion in 2002, according to Moody's.

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