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The report on the 'Latin American Economic Outlook' recently published by the OECD insists on the need to take advantage of the resources that Latin America has to reverse a trend of little development. Jobs are of low quality in the region and poverty continues to hit almost a third of the population, who must also think about the well-being of future generations, including the climate aspect.
The report 'Latin America Economic Outlook 2023', recently presented by the Development Center of the Organization for Economic Cooperation and Development (OECD), focuses attention on the urgent need that the region has to invest in sustainable development. “The variable we aim to see if we are achieving greater sustainable development is how we promote quality jobs. We are still talking about 43% of households that are totally informal in Latin America,” says Sebastián Nieto Parra, head of the OECD unit for Latin America, a guest of Escala in Paris.
The 18th edition of LEO (Latin American Economic Outlook) highlights that, seen globally, the region continues to lose ground in terms of competitiveness, productivity and, above all, fails to create more and better jobs in the sector. formal. Potential GDP per capita growth has been less than one percent since the 1980s.
The OECD recommends investing in four so-called emerging sectors: green transition; digital transformation; health, economy and care; and sustainable agriculture and food. “If we invest well, if we invest close to 3 percentage points in green sectors, that is, those with low CO2 emissions, and we look at sectors that generate employment, we can grow close to 20%, for example, in job creation in the sustainable manufacturing sector in the food sector, also in sustainable transportation we can generate about 14% employment between now and 2030,” postulates the specialist.
One of the main problems that the region suffers from is the very low level of internal savings, necessary to invest without depending on the outside world. “Today in Latin America, internal savings rates are close to 20% of GDP, practically half of what we have in emerging Asian economies, and what we see is that it is the region with the lowest investment rate at this time. in the world”.
To face the multiple challenges facing the region, the OECD proposes advancing public-private partnerships. In this regard, the report highlights that 55% of the Latin American population distrusts investment by local companies, a level that rises to 59% in the case of investments by foreign companies. “Faced with the framework of public-private partnerships, Latin America has substantially improved their institutional regulatory framework,” says Sebastián Nieto. “We have been able to take into account past errors, for example, in negotiations of road concession contracts in several countries,” emphasizes the head of the OECD unit for Latin America.
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