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ECLAC Proposes a New Development Pattern for Latin America and the Caribbean

2016 | Source: ECLAC - Author:

Latin America and the Caribbean has a historic opportunity to change its development pattern and reduce the economic, social and environmental imbalances that affect its inhabitants. To achieve that, it is necessary to bring about progressive structural change with a great environmental push that promotes development based on equality and sustainability. This is the proposal of the Economic Commission for Latin America and the Caribbean (ECLAC) for the year 2030.

ECLAC explains in the document that the current development system is unsustainable, since it is based on three imbalances: the global economy’s recessionary bias, increased inequality and environmental deterioration.

The international community has not been indifferent to these challenges and it responded with the approval last September by the UN General Assembly of the 2030 Agenda for Sustainable Development and the 17 Sustainable Development Goals (SDGs). In Horizons 2030, ECLAC contributes by providing an analytical framework for that Agenda based on its structuralist tradition and the regional, subregional and national perspectives and particularities of Latin America and the Caribbean.

The Commission proposes altering the traditional way of doing things and driving progressive structural change, which entails prompting changes in the productive structure that increase the participation of knowledge- and innovation-intensive sectors, guarantee inclusive and sustained economic growth, promote the creation of quality jobs with rights, and that are associated with sectors that foster the production of environmental goods and services.

In addition, ECLAC calls for making an environmental “big push” that should include a package of coordinated public and private investments in different areas that generate new energy and production patterns, a renewed design for sustainable cities, and less-polluting consumption trends, based on learning and innovation—in sum, betting on a circular economy, with full employment.

“It is necessary to regain economic growth, but this should be based on a low carbon path that allows for the decoupling of growth and emissions, since current production and consumption patterns are not sustainable,” Alicia Bárcena, the organization’s Executive Secretary, recommends.

This productive transformation must be made in an adverse context. “That is why a new political economy, a new State-market-society equation and renewed international and national coalitions are required,” the document says. “It is about changing the conversation.”

ECLAC proposes centering actions on three areas: 1) international governance for the provision of global public goods; 2) cooperation and the regional contribution to the global debate; and 3) national public policies to promote progressive structural change.

Regarding the creation of global public goods, the organization explains that four mechanisms must be established: first, an international coordination of economies that fosters the sustained expansion of aggregate demand with monetary, fiscal and investment-related instruments that prioritize low carbon projects that are more energy efficient, in favor of quality employment, with rights; second, a new international financial architecture; third, a trade and intellectual property governance that is multilateral and facilitates and broadens access to technology and financing; and fourth, a new shared governance at a global level of the essential components of the digital economy and a new regional technological paradigm to achieve a single digital market in Latin America and the Caribbean.

To bolster the regional contribution, the Commission proposes creating or expanding the financial security networks of the Latin American Reserve Fund (FLAR), and strengthening regional development banks. It also calls for advancing towards productive and trade integration, in the creation of a common digital market and in the establishment of a resilience fund linked to debt relief for Caribbean countries.

In terms of national strategies and policies, ECLAC calls for redefining macroeconomic policy and strengthening the State’s institutional capacities. This implies expanding the countercyclical role of fiscal policy, advancing towards more solid commitments on social protection to achieve poverty eradication and inequality reduction, implementing industrial policies centered on the environment and productive diversification, and promoting measures for transparency, inclusion and citizen participation.

“We are facing the greatest opportunity of all times for development policies. The agenda of environmental sustainability and the fight against inequality should be the foundation of the development agenda,” Alicia Bárcena emphasizes.

 

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