Sunday, December 3, 2023

Latin America should grow twice as much as expected to reduce poverty, according to the World Bank

The region of Latin America and the Caribbean should grow by around 5% in the coming years, twice as much as expected, to make significant progress in reducing poverty, according to the chief economist of the world Bank (BM) for the area, William Maloney.

“It could be 4%, it could be 6%, but I’m saying double that would be a good goal. It has to be better than 2.4%”, Maloney estimates in an interview with EFE in Madrid, where he presented the report “The potential of integration: opportunities in a changing global economy”.

In this study, published last April, the World Bank forecasts growth for the region of 1.4% in 2023 and 2.4% in 2024, which is not enough “to alleviate poverty or dissipate social tensions”. according to the conclusions.

The worst prospects are in Chili, a country for which the World Bank forecasts an economic contraction of 0.7% in 2023; and Argentina, for which he estimates stagnation.

“We have lost several years due to the pandemic,” the expert noted.

The WB report states that the Poverty rate in the region increased from 29.7% in 2019 to 34.4% in 2020, with some 19 million people entering that situation, which represents a setback of seven years or more compared to previous data.

“Obviously, there are more policies to help families in various dimensions. I always say that improving public education, for example, is the best way to promote social mobility”, but “in the long term, the way that has reduced poverty most effectively has been economic growth”.

“We have to work on both fronts -she states-, at the family level, to ensure that we have a well-established, well-financed social protection network, but the long-term issue is growth”, she stresses.

Regional integration

Regarding the call made by the Brazilian president, Luiz Inácio Lula da Silva, to resume regional integration, Maloney believes that these initiatives promote economies of scale, so that Latin American companies can expand and have access to local markets.

“Exporting to our neighbors is good preparation for exporting to the world in general, if you think about it strategically,” he adds.

In the long term, he points out, the objective is “to achieve more transfer of technology knowledge to the region and that comes from the countries in the technological frontier“.


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