Introduction

At the core of regional development lies the crucial goal of ensuring social inclusion, understood primarily as the full participation of communities in the economic life of society. Full compliance with this principle would ensure that all individuals and social groups have access to the same opportunities to prosper, thereby reducing socioeconomic disparities. However, this objective has been elusive in the region and remains a significant challenge.

Over the last three decades, Latin America and the Caribbean has made significant progress in improving living conditions and socioeconomic equity. However, the path towards the total eradication of poverty and the profound reduction of inequality remains incomplete. In recent years, in fact, this process seems to have slowed down and even stalled in some countries. Approximately 30 % of Latin Americans and Caribbeans still live in poverty conditions according to ECLAC data (CEPALSTAT, 2024)¹. In addition, Latin America and the Caribbean is still positioned as one of the regions with the greatest inequality in the world, both in terms of income and wealth². 

Addressing the underlying structural causes is essential to overcome the obstacles that limit the social inclusion of broad sectors of the population in Latin America and the Caribbean. Identifying the possibilities for inclusion involves understanding the complex network of opportunities that should be available throughout people’s life course. In childhood and adolescence, it is crucial to guarantee the formation of human capital through education and job training; in adulthood, to facilitate access to quality jobs and the possibility of saving and accumulating key assets; and in old age, to guarantee well-being and autonomy through adequate income, health and care protection.

One of the pillars of inclusion policies must be the guarantee of equal opportunities. However, given that numerous barriers persist in the region that limit this equality and contribute significantly to socioeconomic gaps in different dimensions of well-being, ex post redistributive policies continue to play a crucial role. This dual approach, which combines the promotion of opportunities with redistributive measures, is essential to adressing both the causes and consequences of poverty and inequality in Latin America and the Caribbean.

This chapter focuses on key areas of intervention in the region, considering the extent of socioeconomic gaps and their potential for social impact and benefit. Policies should address the main barriers faced by the most disadvantaged individuals and households, such as financial constraints, lack of insurance and limited access to quality public services. There are barriers of a different nature, such as lack of knowledge and information, social norms, discrimination and spatial frictions that also need to be addressed. The design of inclusion policies faces, in turn, new challenges arising from macro trends such as technological, demographic and climatic changes. These transformations bring new issues, such as fiscal pressure on pension, health and elder care systems, the threat to employability and climate risks that disproportionately affect the most vulnerable groups. But they also offer opportunities, such as access to new technologies for financial inclusion. Adaptive capacity and long-term planning will be essential for sustaining effective progress in social inclusion.

When we think about the environment, I think Latin America has sinned of being a bit extreme in its concerns for protection. There is a growing anti-mining movement: we saw what happened recently in Panama, we are seeing the impossibility of mining developments in Colombia, in Peru, in Chile. I want to say to Latin America that we cannot save the atmosphere without scratching the earth and we have a great difficulty in balancing global environmental protection with local protection.

Based on an interview with Ricardo Hausmann