Sustainable Development in
Latin America and the Caribbean
Towards a post-2015 development agenda
Alicia Bárcena
Executive Secretary
Economic Commisssion for Latin America and the Caribbean
Guadalajara (Mexico), April 17 2013
The normative world: two paths through Post2015 Agenda
SUSTAINABLE DEVELOPMENT
PATH
1972 United Nations Conference on
the Human Environment
1987 Our Common Future
1992 United Nations Conference on
Environment and
Development
1994 Global Conference on the
Sustainable Development of
Small Island Development
States
1997 Río +5
MILLENNIUM DEVELOPMENT GOALS
PATH
1990
1990
1992
1993
1994
1995
1995
1996
1997
World Summit for Children
World Conference on Education for all
International Conference on Nutrition
World Conference on Human Rights
International Conference on Population and
Development
World Summit for Social Development
Fourth World Conference on Women
United Nations Conference on Human
Settlements (HABITAT II)
Kyoto Protocol
2002 International Conference on Financing for Development
2002 Río+10 Johannesburg
World Summit on
2000 Millennium Summit
Sustainable Development
2003 Phase One of World Summit on the Information Society
2012 Río +20
2013 Post 2015-General Assembly
Different global trajectories:
economics–finance-trade
•
•
•
•
•
•
•
•
•
1991 –Fall of the Berlin Wall
1986-1994 – Uruguay Round
1995 – WTO succeeds GATT (outside the UN system)
1997 – liberalization of telecommunications and financial
services
2001 – Doha Round: agriculture and services, TradeRelated Aspects of Intellectual Property Rights (TRIPS)
Globalization: Finance and trade openness
Reduced role for the State - privatizations
Dominance of transnationals and global value chains
Supremacy of finance over production issues
MULTILATERAL POLITICAL FRAMEWORK
Rio-Johannesburg-Rio Conferences:
 Common but differentiated responsibilities
 Development financing and technology transfer
 Explicit mechanisms for information access and
citizen participation
 New generation of conventions with openness to
the participation of main groups
 Prior and informed consent
WTO:
 Levelling the playing field
 Free access to markets, but not to labour
 TRIPS: access to technology and products
 Consensus through concentric circles, with little
citizen participation and asymmetries in
developing countries
Unresolved inconsistencies
• Common but differentiated responsibilities versus
“levelling the playing field”
• Commitments versus real financial support
• Technology transfer to developing countries versus
concentration of technical progress in developed
countries
• Fair trade versus more acute trade and financial
asymmetries
• Overall increase in inequality: income and functional
distribution
• Asymmetry in real assets versus financial assets valuation
• Prior and informed consent versus foreign investment in
extractive sectors without consultation
Towards the future we want in
Latin America and the Caribbean
• Fulfilment of MDGs: necessary but not the only
prerequisite
• From basic needs to closing structural gaps
• Move from national- and developing-countries-oriented
targets to universal objectives and with revived metrics
• The post-2015 development agenda requires a global
financing and technology transfer covenant
• Concepts with a long-term, rights-based approach
• The goal: more resilient, self-sufficient and balanced
economies
• Shared progress
A decade of inter-agency work on
sustainable development in the region
• Regional preparatory meetings for United Nations conferences
• Regional implementation forums
• Regional reports on the MDGs (2005 and 2010) and Rio+20
The road so far and obstacles
to the achievement of the
MDGs
Poverty and extreme poverty are at their lowest
rates in 20 years. But LAC is still the most unequal
region in the world, in spite of some recent
progress in reducing income inequality
LATIN AMERICA: POVERTY AND INDIGENCE, 1980-2012 a
(Percentages)
Source: Economic Commission for Latin America and the Caribbean (ECLAC),
on the basis of special tabulations of household surveys conducted in the
respective countries.
a Estimates for 18 countries in the region plus Haiti. The figures at the top of
the bars represent the percentage and total number of poor people
(indigent plus non-indigent poor). The figures cited for 2011 and 2012 are
projections.
LATIN AMERICA AND OTHER REGIONS OF THE WORLD: GINI
CONCENTRATION COEFFICIENT, AROUND 2009 a
Source: Economic Commission for Latin America and the Caribbean
(ECLAC), on the basis of special tabulations of data from household
surveys conducted in the respective countries; World Bank, World
Development Indicators [online].
a The regional data are expressed as simple averages, calculated using
the latest observation available in each country for the 2000-2009
period.
b Organisation for Economic Co-operation and Development.
Progress towards MDGs 2-7
• In education (MDG 2): high coverage and access to primary education
(90%) but the quality needs to be improved and the focus must shift to
secondary education.
• Gender gaps (MDG 3): gender equality in education but more is
needed to boost autonomy in the economic (income and property),
physical (reproductive health) and political (access to decision making)
spheres.
• Child mortality (MDG 4): sharp reduction –from 42 deaths per 1000
live births to 16.
• Maternal mortality (MDG 5): most countries will not reach the goal.
Early warning: adolescent pregnancy in poor households.
• HIV/AIDS (MDG 6): the prevalence of HIV in adult population has
stabilized, but the situation of younger people is worrisome due to lack
of knowledge about the disease and its prevention.
• Environmental sustainability (MDG 7): the consumption of ozonedepleting substances has diminished, protected areas have increased,
coverage of potable water (98%) and sanitation services (85%) has
improved. But LAC has the highest deforestation rates and carbon
dioxide emissions have grown steadily.
Latin America and the Caribbean: quantifying
the set of targets
Source:: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of CEPALSTAT and special tabulations of data
from household surveys conducted in the respective countries.
MDG 8: Global Partnership for Development, the goal
for which the region lags furthest behind
AVERAGE TARIFFS IMPOSED BY DEVELOPED MARKET
ECONOMIES ON AGRICULTURAL PRODUCTS FROM
DEVELOPING AND LEAST DEVELOPED COUNTRIES
(Percentages)
MONTHLY AVERAGE COST OF 1 MBPS OF FIXED BROAD BAND
(Percentages of GDP per capita)
ESTIMATES OF AGRICULTURAL SUBSIDIES IN
DEVELOPED COUNTRIES
(Billions of dollars and percentage of GDP)
AID FOR TRADE BY REGION
(Billions of dollars at 2009 prices)
The countries with the highest poverty rates need
between 3% and 4% of GDP to close the gap
LATIN AMERICA (18 COUNTRIES): POVERTY GAPS, AROUND 2011
Source: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of official figures from the
respective countries.
Providing universal primary education
costs between 0.5% and 0.04% of GDP
LATIN AMERICA (SELECTED COUNTRIES): ESTIMATED COST OF ACHIEVING UNIVERSAL PRIMARY EDUCATION
Source: Economic Commission for Latin America and the Caribbean (ECLAC)/ Organization of Ibero-American States for Education, Science
and Culture (OEI), “Metas educativas 2021: estudio de costos”, Project Documents, No. 327 (LC/W.327), Santiago, Chile, July 2010.
a Ibero-American countries (excluding Spain and Portugal).
Social progress transcends
social policies
• Sound macroeconomic management helps to curb social
losses during crises and boosts investment and
productivity(debt, reserves, exchange rate)
• Low inflation rates attenuate vulnerability to volatile
international prices of primary goods and food products
• More balanced public finances build fiscal space for
sustaining public spending and consolidating social policies
• Investment and savings: fixed capital formation,
infrastructure, innovation
• Strong, sustained economic growth boosts formal job
creation and labour income
• Employment with rights is the key to equality
Towards a sustainable
development agenda in
Latin America and the
Caribbean
How to move from MDGs to SDGs?
The current model is unsustainable
• Economic growth is not enough: growth is needed for equality just as
equality is needed for growth
• Poverty reduction is not enough if structural inequalities based on gender,
ethnicity and territory persist;
• Higher productivity is not enough unless it is associated with innovation
and high value added, decent jobs, sustainable use of natural resources
lower carbon intensity and reduced waste;
• It is not enough to provide education unless it is quality education and
provides entry into the labour market;
• It is not enough to have gender education parity if women do not have
access to the labour market on an equitable basis and full physical and
political autonomy and empowerment;
• Higher social spending by the State is not enough unless development is
underpinned by sound macroeconomic fundamentals;
• It is not enough to have a targeted welfare policy if it is not accompanied
by public policy for universal social protection;
• It is not enough to act sporadically against environmental degradation
without a paradigm shift in production and consumption.
A structural change is necessary
Inequality
Productivity
For the first
time in recent
history there
have been
advances in
combating
inequality
Closing the
external gap
(with the
technological
frontier) and the
internal gap
(between sectors
and actors)
International
linkages
Risk of
“reprimarization”
of the export
structure, with
low value added
and little
investment in
technology
Environmen
-tal
sustainabiit
y
Move towards
sustainable
production
and
consumption
patterns
Taxation
Regressive
tax
systems;
weak noncontributor
y pillar
Investmen
t
Investment,
at 22.9% of
GDP, is
insufficient
for
developmen
t
• Lifting low-income countries out of poverty calls for the equivalent of 2.5% of
world GDP. Lifting only Latin America and the Caribbean, a middle income
region ($ 10,000 per capita PPP), to the income level of developed countries ($
38,000) is equivalent to 19% of global GDP. Lifting all upper middle income
countries to a high income level would require the equivalent of 85% of world
GDP.
• Apart from the inequities concealed by averages, and even disregarding the
future costs of violence, undernutrition, climate change, among others, the
current development model will be unable to generate this income growth
The current growth rate is not enough
LATIN AMERICA AND THE CARIBBEAN: PER CAPITA GROWTH RATE, CURRENT
ACCOUNT BALANCE AND FISCAL BALANCE, 1950-2010
6%
5%
4%
3%
2%
1%
0%
-1%
-2%
-3%
-4%
-5%
Source: Economic Commission for Latin America and the Caribbean (ECLAC).
2012
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
1988
1986
1984
1982
1980
1978
1976
1974
1972
1970
1968
1966
1964
1962
1960
1958
1956
1954
1952
-6%
The heterogeneous production structure
reproduces inequalities, concentrating
employment in low-productivity sectors
LATIN AMERICA (18 COUNTRIES): STRUCTURAL HETEROGENEITY INDICATORS, AROUND 2009
(Percentages)
The region has remarkable assets,
but also weaknesses
Assets
•
Better macroeconomic indicators: international reserves, low public debt,
low inflation
• Poverty has fallen
• Abundant natural resources:
– One third of arable land and freshwater reserves
– around 31% of the production of biofuels and 13% of oil production
– Share of production: 47% of copper, 28% of molybdenum and 23% of
zinc
– 48% of world output of soybean, 31% in the case of meat , 23% for
milk and 16 % for maize
– 20% of ​natural forest area and rich biodiversity
Weaknesses
•
•
•
•
•
Production and export structure based on static comparative advantages
(linked to natural resources)
Lags in innovation, science and technology
Low investment in infrastructure
High labour-market informality
Lack of mechanisms for asserting ownership of natural resource
productivity gains
The production structure remains stuck
on a technically less dynamic path
LATIN AMERICA AND THE CARIBBEAN: EXPORT STRUCTURE BY TECHNOLOGY INTENSITY, 1981-2010 a
(Percentages of the total)
Source: ECLAC, on the basis of United Nations Commodity Trade Database (COMTRADE).
a Cuba and Haiti not included. Data for Antigua and Barbuda refer only to 2007, and data for the Bolivarian Republic of Venezuela only to 2008; data
for Honduras
do not include 2008; data for Belize, Dominican Republic, Saint Kitts and Nevis, Saint Lucia, Suriname and Grenada (exports only) do not include 2009.
The current style of development shows a
strong correlation between GDP growth,
energy consumption and pollutant emissions
LATIN AMERICA: PER CAPITA GDP AND PER CAPITA ENERGY CONSUMPTION, 2008 a
(Kilograms of oil equivalent and 2005 purchasing power parity dollars)
Lack of education reproduces and
perpetuates social inequalities and poverty
LATIN AMERICA (18 COUNTRIES): MONTHLY LABOUR INCOME OF THE EMPLOYED POPULATION,
BY AGE GROUP AND LEVEL OF SCHOOLING
(Dollars at 2000 prices, PPP)
Source: Economic Commission for Latin America and the Caribbean (ECLAC).
Characteristic diseases of poverty and
wealth coexist: undernutrition and
overweight in children
LATIN AMERICA AND THE CARIBBEAN: UNDERNUTRITION AND OVERWEIGHT
IN CHILDREN UNDER AGE 5, 2000-2009
(Percentages)
Source: Economic Commission for Latin America and the Caribbean (ECLAC).
Urgent need to close gaps in social
protection systems
LATIN AMERICA (14 COUNTRIES): POPULATION LIVING IN HOUSEHOLDS WITHOUT SOCIAL SECURITY MEMBERSHIP AND
WHICH DO NOT RECEIVE ANY PENSION OR PUBLIC WELFARE TRANSFERS, BY INCOME QUINTILE, 2009
(Percentages)
Source: Economic Commission for Latin America and the Caribbean (ECLAC).
Implementation
mechanisms
Closing these gaps calls for a fiscal covenant
that raises the tax burden and makes the tax
structure more progressive
INTERNATIONAL COMPARISON OF THE LEVEL AND STRUCTURE OF THE TAX BURDEN
VARIOUS YEARS BETWEEN 2002 AND 2010
(Percentages of GDP)
Source: Economic Commission for Latin America and the Caribbean (ECLAC), Organisation for Economic Cooperation and Development
(OECD), International Monetary Fund (IMF) a. For most of Latin America, the coverage relates to central government, except for Argenitina, Brazil,
Chile, Costa Rica and Plurinational State of Bolivia.
Consolidate social policies through public
spending
– Public spending reached 29.7% of GDP, and became more progressive
and less procyclical
– Social spending also grew as a percentage of GDP (18.6%) and of overall
public spending (62.6%)
LATIN AMERICA AND THE CARIBBEAN (21 COUNTRIES):
PUBLIC SOCIAL SPENDING AS A SHARE OF TOTAL
SPENDING, 1991-1992 TO 2009-2010 a
(Percentages of GDP and of total public spending)
LATIN AMERICA AND THE CARIBBEAN (21
COUNTRIES): PUBLIC SOCIAL SPENDING BY TYPE,
1991-1992 TO 2009-2010 a
(Percentages of GDP)
Source: Economic Commission for Latin America and the Caribbean (ECLAC), social expenditure database.
a The figures above the bracket signs represent the increase in spending in percentage points between the periods 1991-1992 and 2009-2010.
The pending challenge: financing for
sustainable development
LATIN AMERICA AND THE CARIBBEAN: MAIN EXTERNAL FINANCING FLOWS, 1990-2012
(Percentages of GDP)
Source:: Economic Commission for Latin America and the Caribbean (ECLAC), on the basis of official data from the countries, the
International Monetary Fund and the Organization for Economic Cooperation and Development.
Two innovative financing
mechanisms are on the table
Global taxes
Global Funds
• Tax on financial transactions
• On international transactions
and operations
• Between 0,01% and 0,1%
• Potential charge could be 0,5%,
and 2,4% of global GDP, applied
to developed countries
• Green taxes
• Air transportation
• On fossil fuels
• Total revenue could amount to
between US$ 60 and US$ 130
billion per year
•International financial services
• Mechanism to securitize future
ODA flows, which can mobilize
up to US$ 500 billion in
additional ODA
• Special Drawing Rights
• Instruments to finance the
provision of global public goods:
environmental, health and
education and humanitarian aid
• Grants, loans and equity
financing amounting to US$ 7
billion could be transferred
annually to developing countries
A regional reading of the post-2015
agenda
1. The focus must continue to be on the remaining lags in
achieving the Millennium Development Goals (MDGs).
2. The region is changing and facing emerging issues: energy,
demography, urbanization, disasters and citizen security.
3. Addressing new challenges as well as old ones calls for a new
development model based on a structural change for equality
and environmental sustainability to close structural gaps.
– Increased labour productivity with decent employment and
full access to labour rights
– Educational opportunities that permit entry into the labour
market, build greater civic awareness and informed political
participation and contribute to better integration in society.
– Equality, in particular, physical and economic autonomy, and
empowerment for women
– Environmental Sustainability with full internalization of
externalities.
A regional reading of the post-2015
agenda
4. Minimum levels of well-being have risen: good-quality, rightsbased universalist State policies: progress towards a higher level
of civilization.
5. Policy and institutions matter: regulation, taxation, financing and
governance of natural resources that give the right signals to the
private sector , which has co-responsibility for the development we
seek
6. Better measuring is required: + GDP, national accounts that reflect
actual production costs
7. Global governance for sustainable development must be built:
effective decision-making forums with the participation of society.
•
Fair trade, technology transfer and international financial reform
•
New financing mechanisms,
8. Build regional density and promote South-South cooperation to
strengthen the instruments of social participation.
Equality is the objective, structural change the way,
and politics the instrument
THE CRITICAL ROLE OF THE REGIONAL SPACE
• Complementarities between global and regional
institutions, in a heterogeneous international
community
• Protection of the weaker players
• A greater sense of belonging to regional and
subregional institutions
• With interdependence, autonomy shifts to the
subregional and regional levels
• Provision of public goods through a network of
global and regional institutions
• Deeper integration ...... but this means overcoming
the tendency of the global order to cause
disintegration
New equation:
State-market-society

The public space as a collectivity of interests and
not as an area for State or national influence

Political agreements for a new social and
intergenerational contract with defined
responsibilities, protection of rights and systems of
accountability

Enhancing a culture of collective development
based on tolerance for differences and diversity

Strategic vision and long-term development from
within, promoting agreements between stakeholders
involved in production

State policies, not only at the government or
administrative level, but also in terms of institutions
Alicia Bárcena
Executive Secretary
Economic Commission for latin America and the Caribbean