The Economic Commission for Latin America and the Caribbean calls for coherent strategies to tackle the epidemic

A new report from the commission added that the time has come for consensual reforms to counter the structural development traps affecting the region.

This summary was prepared jointly by the Development Center of the Organization for Economic Co-operation and Development (OECD), the Economic Commission for Latin America and the Caribbean, the Latin American Development Bank (CAF) and the European Commission (EC).

This document is entitled Latin America Economic Outlook 2021: Moving Together towards a Better Recovery.

The text states that the region is severely affected by the epidemic, while the social and economic developments of the last decade are in danger of being reversed by the health crisis.

It specifies that recovery strategies must include well-planned reforms that strengthen comprehensive social protection systems, accelerate the formalization of economies, improve financial progress, and deepen regional integration.

According to this 14th edition of the report, Latin America and the Caribbean (LAC) showed a historic economic slowdown in 2020. The region’s gross domestic product shrank by nearly seven percent.

Despite an increase of about six percent in 2021, per capita GDP is not expected to return to pre-crisis levels until 2023-24.

The impact of the crisis is asymmetric, affecting particularly the most vulnerable. As a result, poverty and extreme poverty levels have reached their highest levels in the past 20 years and 12 years, respectively.

In this sense, the report acknowledges the significant efforts countries in the region are making to protect the most vulnerable during the pandemic, including women, youth and the elderly.

Despite this, he warns, about 40 percent of workers did not have social protection when the crisis began.

This is largely due to the fact that, on average, more than 50 per cent of the region’s workforce is employed informally.

They insist that moving toward comprehensive social protection systems is essential to protect those who need them most in a post-pandemic context.

According to the brief, a strong and inclusive recovery requires greater production integration in strategic sectors, including automobiles, pharmaceuticals, renewable energy, circular economy, and sustainable agriculture.

It also requires a comprehensive and prompt fiscal response, a more progressive tax system, compliance with rules, more efficient tax administration, and the elimination of ineffective expenditures.

oda / rfc