Latin America and Caribbean needs policies to push growth, reduce inequality

Some of the factors blamed for the slowdown include less domestic demand, fragile international financial markets, and growing social demands.

The Latin American and Caribbean economies are looking at the lowest growth in seven decades, according to the latest annual report from the UN organization for the region, ECLAC (the Economic Commission for Latin America and the Caribbean), which was published on Thursday.

Some of the factors blamed for the slowdown include less domestic demand, fragile international financial markets, and growing social demands. The region’s economies are forecast to grow 0.1 percent in 2019, and growth in 2020 is projected to remain low, at around 1.3 percent.

“Given this scenario, the region needs policies to stimulate growth and reduce inequality. The current conditions require that fiscal policy be centered on the reactivation of growth and on responding to growing social demands”, stated Alicia Bárcena, Executive Secretary of ECLAC, at the launch of the document.

Within the region, there is a wide variation in prospects: Dominica is expected to see the greatest expansion in 2019, at nine percent, whilst Haiti has the grimmest outlook, with an economy contracting by minus 0.7 percent.

Recommendations include sustainable fiscal policies; crackdowns on tax evasion; new taxes related to the digital economy, the environment, and public health; and greater public spending on investment and social policies.