Milestones of the economic and social development of Latin America in 2021 | International

Despite the wishes and hopes of much of humanity, the 2021 will remain in our memory as another year marked by the pandemic. It was the year the end of the tunnel began to be seen thanks to vaccines, and there was also some economic euphoria after registering a rebound in global growth, but social and personal consequences, in the health systems and in a large part of the economic activity they continued to tip the balance towards the crisis.

It is estimated that economic growth in Latin America and the Caribbean in 2021 was 6.3% of GDP, something very positive after the strong recession of 2020. But experts predict that maintaining these levels of growth will be difficult in the coming years , therefore, the countries of the region should strengthen their social protection systems, invest more and better in infrastructure and work to increase productivity and competitiveness.

(See: New leaders and global supply crisis, keys to 2022).

In any case, 2021 leaves us with some development milestones in Latin America and the Caribbean that are worth highlighting:

1. Vaccination advances in Latin America and the Caribbean

As the West and China advanced their vaccination processes at a frantic pace, developing regions found it difficult to access vaccines, in part due to the absence of drugs and poorly advanced infrastructure. Currently, 57% of the world population is vaccinated.

(See: Colombia, among the safest countries to spend the end of the year).

But throughout 2021 Latin America and the Caribbean recovered, and at the end of the year 56% of the Latin American population is vaccinated, while in the US and the European Union (EU) approximately 61.5% and in China about 80%. The differences in the region are also notable, with countries such as Chile and Cuba with vaccination rates greater than 80%, others with also high percentages, such as Argentina (69%), Brazil (66%) and Uruguay (76%), and others more modest, less than 40%. Despite the initial drawbacks, all countries have ambitious vaccination plans to achieve herd immunity in the coming months, shows the response capacity in the region.

At the end of the year, 56% of the Latin American population is vaccinated.

Jaiver Nieto. TIME

2. Economic rebound

It is estimated that the region will grow 6.3% in 2021, a necessary rebound after the recession registered last year, and that allowed economic sectors to recover and boost others, such as electronic commerce or streaming. Despite this good news, the great structural challenges in Latin America and the Caribbean remain more relevant than ever after the pandemic. One of them is the low potential growth, whose weakening since 2015 slowed the reduction of poverty and inequality that had occurred since the previous decade. Between 2015 and 2020, poverty increased approximately 6 percentage points from the low of 27.8% reached in 2014. Half of this deterioration occurred with the collapse of activity and employment caused by the pandemic in 2020.

(See: This is the first anticovid vaccine made in Latin America).

3. Latin America and the Caribbean, a leader in climate action

More than 40,000 international climate experts met in Glasgow for COP26, a global summit that was called to increase ambition to reduce greenhouse gas emissions, and thereby achieve emissions neutrality by 2050.

For Latin America and the Caribbean, it was a step forward in its positioning as a relevant and necessary actor in the fight against global warming, thanks mainly to its rich biodiversity. The region also made progress in expanding financing for adaptation and mitigation initiatives, and in its commitment to nature-based solutions. During COP26, CAF announced that in the next five years it will allocate 25,000 million dollars to promote green growth in the region. Along these lines, the multilateral organization will also articulate a regional carbon market.

Environment

One of the agreements at COP26 was to achieve emissions neutrality by 2050.

4. Digitization at the center of the agendas of the countries

The pandemic precipitated the digitization of businesses, commerce, education and government globally to varying degrees. The region has an opportunity to consolidate the digital transformation with greater investment in infrastructure for connectivity, increase the productive use of digital technologies, close access gaps in households and workers, and improve guarantees for data privacy. In addition, the regional scale can be used to promote a regional digital market that facilitates connectivity and digital entrepreneurship.

Digital transformation

In Latin America, a regional digital market is promoted that facilitates connectivity and digital entrepreneurship.

Private file

5. Time of multilateralism

The crisis has also highlighted the need to create new consensus and unite different actors to promote solutions. In this sense, the role of development banks has been strategic to mobilize resources to the region, serving as a transmission belt for extra-regional capital and innovating in financial products to strengthen sectors that promote sustainable development, generate employment and help reduce the poverty.

(See: Is there a Starbucks in Venezuela or not? This is the controversy that was created).

In this regard, at the beginning of December, CAF’s board of directors approved by consensus a capitalization of 7,000 million dollars, that will allow it to double the portfolio by 2030, with a focus on a strategy of green bank and bank of economic reactivation, to help lay the foundations of a more prosperous, inclusive and respectful region with the environment.

CAF
* Visions of Development is a section promoted by CAF (Development Bank of Latin America) that analyzes the main development issues in the region.

.

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.