Latin America hurt little by market woes-Treasury

WASHINGTON, Oct 20 (Reuters) - Finance ministers from six Latin American countries told U.S. Treasury Secretary Henry Paulson on Saturday that their economies were suffering little damage from the credit market turmoil that has wracked the United States and Europe.

"Right now, the impact has not been high, but they are obviously vigilant about what they're doing," Clay Lowery, the Treasury's assistant secretary for financial affairs, told reporters after the meeting with finance ministers from Mexico, Chile, Colombia, Argentina, Peru and Uruguay.

Lowery said the limited fallout in the region partly reflected reasonably strong growth and sound economic policies that have kept inflation under control, reduced debt and strengthened capital markets.

The Latin American finance ministers told Paulson their main concern was whether the credit market turmoil would slow down the U.S. economy, which "has been a growth engine" for the region, providing a market for their goods.

Although one of the ministers described the situation as a "new world" where problems in developed economies did not infect the region, Lowery was reluctant to say that the countries had "arrived" from a sound economic policy standpoint.

"It's never safe to say that anyone's arrived. I would say that the United States still needs to arrive at times," Lowery said.

The finance ministers also discussed China's growing influence in Latin America and warned of growing protectionist sentiment prompted by trade imbalances with China.

"One of the issues that frankly is a sticking point is China's currency," Lowery said.

On Friday, the G7 finance ministers and central bank governors again called on China to let the value of its yuan currency rise more quickly to ease global imbalances and rising domestic inflation.