Latin America urged against protectionism

* Lula says protectionism only brings short-term relief

* World Bank official says protectionism "not a good idea"

* Some regional countries have raised trade barriers

By Stuart Grudgings

RIO DE JANEIRO, April 15 (Reuters) - Latin American leaders and executives urged governments in the region on Wednesday to stop erecting trade barriers, saying the financial crisis was a chance to tackle problems that have long hindered the region's competitiveness.

Brazilian President Luiz Inacio Lula da Silva, hosting the Latin America World Economic Forum in Rio de Janeiro, said protectionist moves by some countries would only deliver short-term relief from the economic downturn.

"Protectionism is like a drug, which offers immediate relief but then puts its victim in a prolonged depression," Lula, a strong proponent of renewing world trade talks, said in a speech opening the two-day meeting of business leaders.

The global financial crisis has slammed the brakes on five years of buoyant economic growth in the region, knocking demand for commodities from oil to copper, pushing economies into recession, and driving millions of people into poverty.

In a region with a long history of populism, leaders are feeling pressure to shield their economies as trade flows plunge and jobs are lost. Ecuador has sharply increased tariffs on imports, Mexico has raised duties on a long list of American imports, and Argentina tested Brazil's patience by imposing extra import restrictions.