1. Lights and shadows of Latin America and the Caribbean’s elusive development
- Introduction
- The triple challenge for the development of Latin America and the Caribbean
- Historical features that condition development in the region
- A future of opportunities and challenges
- Twenty years thinking about development from Latin America and the Caribbean
- References chapter 1
Key messages
- Development requires success in three interrelated areas: economic growth, inclusion and environmental sustainability. The region shows partial progress in each.
- Although the region has experienced per capita GDP growth, it has been insufficient to close the gap with the developed world..
- Total poverty fell significantly in the first decade of the 21st century. Despite this improvement, almost 30 % of Latin Americans and Caribbeans live in poverty, and more than 10 % in extreme poverty.
- During the 21st century, total emissions in Latin America contracted, especially due to a drop in emissions associated with agriculture and deforestation (AFOLU). The fight against climate change demands, however, greater mitigation efforts for the future. On the other hand, there has been an accelerated deterioration of natural capital in recent decades.
- Incomplete development has prominent features in the region. Three phenomena that stand out are high informality, infrastructure gaps and criminality. One positive aspect is that, unlike in the past, today the region shows superior macroeconomic stability and greater resilience to shocks.
- LAC is a region rich in natural capital. Its development can be leveraged on this important asset.
- Three transitions will significantly condition the development of LAC in the coming decades. The first is accelerated aging. The second is the green transition, which, among other facts, involves a strong reduction of emissions and a higher global valuation of assets present in the region, such as green generation potential, mineral endowment and ecosystem endowment. Finally, the region must complete its development in a world dominated by digital technologies, including artificial intelligence, with substantive implications for jobs.
- The decades ahead pose significant challenges associated, among others, with fiscal, distributive and economic structure impacts. However, they also offer opportunities for the region to close development gaps.
- Closing development gaps requires a comprehensive and knowledge-based agenda. For this reason, RED is an indispensable resource, as it offers an informed discussion on public policies on key development issues from and for the region.