The optimism of Latin America

For the first time in history, Latin America has not suffered too heavily from the consequences of a crisis that has come from outside. The region has finally shown that it can demonstrate stability, resisting even in the most difficult moments of the crisis and experiencing a process of economic growth. After the various vicissitudes suffered by the subcontinent over the past century, dictatorships, coups, debt crises and décadas perdidas, Latin American countries can look to the future in a different way: certainly not all the economies of the countries record the same levels of growth and not all behave in the same way, but overall optimism is perceived and there is a positive evolution of the political-economic balance -social.

The International Monetary Fund has forecast an average annual growth for Latin America of 4.5% in the period from 2010 to 2015. The IMF estimates for Latin American countries are certainly lower than for other macro-regions, but differences must be considered recorded at a regional level: some countries such as Peru show an average annual growth of 6.2%, while Venezuela only of 0.7%, Ecuador of 2.2% and Argentina of 3.9%. In any case, the per capita GDP at purchasing power parity, which in 2010 stood at USD 11,200, should reach USD 14,000 in 2015: an effective economic and living standard improvement has therefore occurred. Latin America, after withstanding the financial crisis, has inaugurated a new phase of development which will lead to a decade of growth, with an increase in per capita income which will reach values similar to the current ones in Eastern Europe.

There are several reasons for such an evolution. Firstly, the growth of Asian countries, obviously including China and India. China's prolonged and dynamic growth presents new global challenges and gives new life to the Latin American economy: the increase in demand for raw materials and energy contributes to the development of the countries that produce them. Furthermore, Chinese operations have repercussions not only on exports but also on direct investments, and Beijing's strategies are precisely oriented in this direction. China therefore drags the subcontinent and all the countries producing raw materials with it.

Second, greater stability and management of macroeconomic policy. The wave of populism (an element that has always characterized Latin American political life) first from the right and then from the left that hit Latin America first in the 1990s and then in the 2000s seems (in part) to have ended. Of course, not all countries are exempt from this omnipresent socio-political-cultural phenomenon, but the example of Lula's Brazil and Bachelet's Chile undoubtedly represents an excellent viaticum for the entire continent. The governments of these countries have thought above all of implementing the reforms necessary for a common development aimed at a shared well-being.

Thirdly, the improvement of social conditions. The problem of poverty has not completely disappeared, on the contrary, it is a very serious problem that is difficult to eradicate. But the poverty rate is decreasing thanks to economic growth and the adoption by some governments (Brazil above all) of social programs focused on education, health and prevention of extreme poverty. The emergence of a middle class favors the growth of domestic demand and presupposes a change in the social and economic policy of the countries where development goes hand in hand with stability.

Furthermore, further measures such as better fiscal and microeconomic policy would further improve growth prospects. Latin America thus faces a decade that could definitively open the way towards development: certainly the forecasts are still far from those in Asia, but the structural conditions are there. The path will not be easy but the foundations that have led to the election of more democratic governments have already been created.

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