(FORTUNE Magazine) – Latin American nations found fault with Treasury Secretary James A. Baker's plan for solving the Third World debt problem. Meeting in Montevideo, Uruguay, ministers of 11 Latin American nations -- members of the so-called Cartagena Group -- called on the industrialized world to do more to relieve the debt burden. ''We are in an emergency situation,'' said Uruguayan President Julio Maria Sanguinetti. ''Bigger steps are required, more daring steps.'' The Baker plan singles out 15 debtor nations that together owe $437 billion , and must pay about $44 billion a year in interest. Under Baker's scheme, commercial banks and international lending agencies would advance $47 billion over the next three years to help the countries pay their debts. In return the debtor countries would adopt economic policies designed to increase growth, strengthen their external accounts, and reduce inflation. Within that general framework, the terms for each debtor would be negotiated separately.

The Cartagena Group charged that the Baker plan doesn't provide enough resources for them to service their debt and grow at the same time. Further, they complained that the plan doesn't address the problems of high interest rates, protectionism, and weak commodity prices. The conferees in Montevideo proposed a set of ''emergency measures,'' including new loans, lower interest rates, and some sort of ceiling on capital outflows. They also formed a five- nation committee -- comprising Argentina, Mexico, Brazil, Venezuela, and Colombia -- to monitor the debt crisis.