Transcript Slide 1

REGIONAL COOPERATION AS A
CATALYST FOR DEVELOPMENT
The case of Latin America and
the Caribbean
Alicia Bárcena
Executive Secretary
Economic Commission for Latin America and the Caribbean
Dialogue with the ECOSOC
Geneva, 8 July 2011
Where does Latin America and the
Caribbean stand today?
• Learning from the past • Performance of LAC was
outstanding in 2010 thanks to
• Maintaining a prudent
both domestic and external
macroeconomic stance
factors
• Socially progressive
• Challenges:
• Risk of inflation
• Marking out a new
• Surge in capital inflows coming
development agenda
into the region
based on rights to
• Currency appreciation
equality
• Reprimarization of the
economies
• Unprecedented context:
• Current deficits
two-speed global
• Food and Energy Price volatility
economy – sluggish in
• Broadband deficiencies
developed countries
• Asymmetric vulnerability to
climate change
and dynamic in
emerging countries
Trade has played a key role in the region’s
economic recovery, thanks to South America’s
trade links with Asia-Pacific, especially China
LATIN AMERICA AND THE CARIBBEAN: TRADE BY ORIGIN AND DESTINATION
(Index: January 2006 = 100)
EXPORTS
(by destination)
IMPORTS
(by origin)
Source: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of official figures.
Commodity prices have increased
aggravating the risk of primarization
LATIN AMERICA AND THE CARIBBEAN:
STRUCTURE OF WORLDWIDE EXPORTS
SINCE THE EARLY 1980s
(Percentages of the regional total)
LATIN AMERICA: COMMODITY PRICE
INDEX
(Index: 2000 = 100)
Source: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of United Nations, Commodity Trade Data Base
(COMTRADE).
Why time for equality?
Main gaps in Latin America and the Caribbean
•
•
•
•
Inequality
and social
protection
Education
and human
capital
For the first time
in recent history
there has been
progress in the
fight against
inequality
Improve
access and
quality,
especially
secondary
cycle
Tax
system
Regressive
tax systems;
weak noncontributory
pillar
Productivity
Close the
external (with
the
technological
frontier) and
domestic
(between
sectors and
actors in a
country) gaps
Investment
and financing
Investment, at
21.6% of GDP, is
insufficient for
development.
Low availability
of domestic
savings
To move towards productivity convergence, it is essential to look beyond the
commodity price boom: macroeconomic, productive and territorial long-term
policies with own vision
Consensus on priorities and respective funding: a Fiscal Pact with redistributive
effect - with access to innovation, labour institutions and job security
Education is key in the translation of productivity gains into jobs and welfare,
when articulated with a labour market geared towards inclusion and equality
New equation: State-market-society
In terms of poverty, the lost decade of the 1980s was
followed by a difficult 1990s and a new century with
notable achievements.
Moreover, poverty and extreme poverty rose less than
expected in 2009 and decreased in 2010
LATIN AMERICA: POVERTY RATES, 1980-2008
(Percentages)
Source: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of official information.
For the first time in the history of the region
there were improvements in equality
A decade without progress in
income distribution…
… Followed by a decade with
some steps forward
0.70
0.70
Countries in which
inequality
increased
0.65
0.60
AR
CL
BO
AL
0.55
SV
EC
0.50
HN
NI
CO
GT
NI
SV
CR
AL
EC
PA
CR
0.45
AR
MX
PY
UY
CL
BO
0.50
MX
BR
0.55
PA
VE
CO HN
GT
2008
2002
0.65
BR
0.60
Countries in which
inequality
increased
Countries in which
inequality decreased
0.45
Countries in which
inequality decreased
UY
PY
VE
0.40
0.40
0.40
0.45
0.50
0.55
1990
0.60
0.65
0.70
0.40
0.45
0.50
0.55
0.60
2002
Source: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of special tabulations of household surveys
conducted in the respective countries.
a/ Urban areas.
0.65
0.70
Pending challenges
in Latin America and the Caribbean
 Review macroeconomic policy to mitigate
volatility, stimulate productivity and increase
inclusion, making it essential to strengthen fiscal
equilibrium in the medium term and develop
financial systems with heightened capacity for
national saving and support for investment
 Bridge gaps in innovation and productivity for
growth with equality and sustainability
 Slow progress in reducing poverty and inequality
 Regressive tax systems
 Changing demographic trends
Gender equality agenda
 Climate change vulnerability and the need to
develop low-carbon economies
 Need to increase energy efficiency and use of
renewable energies
Latin America and the Caribbean is
characterized as a middle income region
• The concept of “middle income” masks large disparities in the
economic and social situations of the Latin American and
Caribbean countries:
–
–
–
–
–
Levels of poverty and distribution of income
Institutional development
Ability to generate national savings
Capacity to access international financial markets
Size and level vulnerability (small open economies in the Caribbean)
• Countries in the region must deploy further efforts to reduce
inequality within their territories and in poor trans-boundary
areas
– Find ways to realize the synergies between social equality and
economic vibrancy
• In spite of improved economic and social performance, the region
still has limited capacity to tackle important gaps relying on
domestic resources only
Challenges for public management
• Tax systems deliver low levels of revenue and are badly
designed
– A regressive tax structure
– A low tax burden in most countries
– High levels of evasion
– Widespread exemptions
• Social spending with little redistributive impact
– A weak non-contributory pillar
– In terms of production: minimum support provided to SMEs and
segmented access to financing
• Insufficient investment for development
– In infrastructure
– In research, science and innovation
– In development banking institutions: inclusive financing
– In cleaner matrices from the environmental perspective
The role of cooperation for the region’s
development is essential
• The “middle-income” concept needs to be rethought as a criteria
for allocating ODA resources
• International cooperation: international community must support
development efforts, considering that over 90% of poor in the
region live in non-poor countries
– Increasing ODA towards the region, channeled with greater efficiency
and effectiveness through strengthened institutional capacities
– Combining ODA with innovative financing and other cooperation
mechanisms such as technology transfers for sustainable
development
• Regional cooperation and integration, in their different modalities,
are crucial catalysts for:
– Cross-fertilization of transversal issues and strengthening the
regional voice in global fora
– To improve the articulation of development strategies at the regional
and domestic levels
– To enhance South-South cooperation and sub-regional integration
schemes
Regional initiatives to address
inequality and social protection gaps
•
The Inter-American social protection network promotes exchange of
experience on the formulation, implementation and impact of social
protection and employment policies and measures with the support of OASILO- ECLAC :
•
Emphasis on conditional transfer programmes
•
SICA has created the Central American Secretariat for Social integration
(SISCA) fostering sub-regional cooperation on social protection issues
•
CAN countries place increasing emphasis on the sub-regional policy
dialogue on social protection, the care economy and families
•
The Caribbean Development Round Table (Trinidad and Tobago, September
2011) will focus on identifying challenges faced by small economies in social
protection and regional integration, among other issues
•
Ministerial conferences foster sub-regional dialogue on the impact of the
rise in commodity prices on social development in Central America and
South America (Santiago and El Salvador) with UN inter-agency support
•
The regional plan of action on information society eLAC 2015 promotes ehealth policies
Investing in education and the region’s
human capital
•
Priorities of regional cooperation and inter-regional
partnerships :
– Improve the quality and equity in primary education
– Reduce traditional and emerging gaps in education (illiteracy,
coverage, reproduction of social inequities, learning gaps,
access to an quality of employment, access to and use of ICT)
education).
– Enhance the efficiency of social spending in education
•
Ibero-American countries have established “Educational
goals 2021” in three phases: complete
secondary/preschool
– 2011- 6 billion
– 2015- 24 billion
– 2021- 79 billion
•
The regional plan of action on information society eLAC
2015 promotes policies aimed at enhancing access to and
the use of ICTs in education
Strengthening financing, investment
and productivity in the region
•
•
•
The Rio Group and CELAC promote regional common positions in the
International follow-up Conferences on Financing for Development
(Regional consultation, Santiago, August 2011)
The Central American Council of Ministers of Finance and Economy
(COMIECO and COSEFIN) are currently developing the Plan for investment
and financing for Central America, Panama and the Dominican Republic
Regional cooperation in the area of Information and Communication
Technologies (ICT) to foster development
– Regional Plan of action eLAC 2015
– Regional dialogue aimed at ensuring universal access to broadband and
creation of a Regional Information Center on Broadband (ORBA)
– Mercosur Group for Productive Integration aimed at promoting SMEs,
investments and value chains
– Inter-regional initiatives: Ibero-American policy dialogue on the
development of SMEs (IBERPYME) and “Pathways to prosperity in the
Americas”
Intra-regional trade shows a dynamic
performance but not enough…
LATIN AMERICA AND THE CARIBBEAN: INDEX OF INTRA-REGIONAL EXPORTS
(In percentage of total exports)
MERCOSUR
MCCA
Source: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of official figures.
ECLAC as a catalyst in regional
cooperation for development
• Multi-sectoral forum for regional policy dialogues
• Follow-up to global conferences and technical support to
countries in reaching regional consensus
• Technical secretariat and catalyst for the formulation and
monitoring of regional plans of action
• Identification and analysis of emerging development issues
and placing them as priorities on the regional policy agenda
• Promotion of South-South cooperation and harmonization
of good practices through capacity building
• Development of regional observatories for comparative
analysis and exchange of experience
• Promotion of inter-agency cooperation at the regional level
Support for highlevel fora
Tools for regional
cooperation
From the Rio Group to the
Community of Latin American
and Caribbean States (CELAC)
Statistical Conference of the Americas
Iberoamerican Summit
(Asuncion 2011) and LAC-EU
Summit (Santiago 2012)
Regional Conference on Women in
Latin America and the Caribbean
Summit of the Americas
(Colombia 2012)
Caribbean Development and
Cooperation Committee
APEC , Pacific Alliance and Latin
American Pacific Basin
initiatives, Foro de Cooperación
América Latina- Asia del Este
(FOCALAE)
Committee on Population and
Development
Subregional processes: UNASUR,
SICA, CARICOM, AECS
Preparatory meetings for global
summits (Rio+20, climate change,
financing for development)
Regional Council for Planning
Regional implementation meetings of the
Commission on Sustainable Development
Plan of Action for the Information Society
in Latin America and the Caribbean (eLAC)
Final messages
• Regional cooperation is essential for an effective
strengthening of the Development Pillar of the UN
• While there is great potential in MICs to enhance regional
cooperation, it is essential to achieved progress in MDG 8:
Global partnership for development
• Regional Commissions play key roles and complement the
regional offices of global UN entities:
– Catalizing regional and sub-regional cooperation
– Enhancing coherence between the regional institutional landscape
and global processess