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FINANCE | 23.03.2021

Aguilera: “In Latin America, the crisis will mean making swifter progress on public policies that will save us from another lost decade”

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The report “Latin America: an agenda for recovery”, prepared by the Euroamerica Foundation and the Fundación Iberoamericana Empresarial, with the support of the CAF (Corporación Andina de Fomento — the Development Bank of Latin America), puts forward a series of proposals aimed at encouraging a post-COVID-19 economic recovery strategy in the region. You can access the full report by clicking here.

The COVID-19 pandemic has led to unexpected consequences all over the world. The Latin American region has been hit harder by the crisis than any other and forecasts indicate that its recovery will be both the weakest and the slowest. General Manager of MAPFRE Economics Manuel Aguilera was actively involved in the preparation of the report “Latin America: an agenda for recovery”.

According to Manuel Aguilera, this study “offers a series of proposals for managing the short-term impacts of the difficult economic situation caused by the COVID-19 pandemic in Latin America, and successfully links these proposals up with the broad structural reforms needed in the region in order to support its medium- and long-term development.”
He was joined in the working group by: José Manuel González-Páramo, executive director at BBVA, former member of the Executive Board and Governing Council of the ECB; economist José Juan Ruiz; Manuel Balmaseda, Chief Economist at CEMEX; Pablo Sanguinetti, Vice President of Knowledge at CAF, and other prominent figures. Miguel Marín, a strategic consultant and CEO of the consultancy firm Análisis Económico Integral, coordinated the report, which was headed up by Román Escolano, State Economist and Trade Expert.

Rebuilding trust and strategic alliances

In the online presentation of the report América Latina, una agenda para la recuperación to the DLAT (Delegation to the Euro-Latin American Parliamentary Assembly), Ramón Jáuregui, Chair of the Euroamerica Foundation and former Chair of DLAT, spoke of the “incredibly grave” situation in the region, which could lose a decade of progress in terms of macroeconomics, standards of living and poverty levels. This situation means that Europe must make itself present in Latin America.

He summarized the four major emergencies: vaccines, in terms of the worrying delays in distribution and “the risk of a moral failure on Europe’s part”; international funding and the responsibilities of international bodies such as the IMF in this regard; the inclusion of the region in the twin ecological and digital transition being promoted by the EU, involving commitments from the European Investment Bank and benefiting from the opportunities offered by this region’s society and its wealth of resources; and the need to establish a strategic alliance between Europe and Latin America. He acknowledged that Latin America’s political community was losing confidence in Europe and business investments were being withdrawn. In the global geopolitical sphere, Europe has no ally more loyal or natural, or with more common values, he asserted, so strengthening solidarity and alliances is a must. The Ibero-American space is a community built upon key multilateral consensus and, with this in mind, the report puts forward measures to ensure that Latin America is not left behind.

For his part, Josep Piqué, President of the Fundación Iberoamericana Empresarial and Spain’s former Minister of Foreign Affairs, said that the document had been well received, since “it is based on solidarity, multilateralism and cooperation” but did not use these to obscure the work that needs to be done internally by the Latin American region itself with regard to competitiveness and structural and governmental reform. In his view, the report has opened up a Euro-Latin American dialog, in the presence of leading experts, about the need for the EU to support the region in global forums and to align the priorities with those of the Portuguese Presidency of the Council of the European Union, with a focus on processing the EU-Mercosur agreement.

The document examines key issues such as the regional integration of Latin American markets, the financing of future investments in limited fiscal spaces and digitization in order to break the closed circuit of informality and the rigidity of the labor markets. The report also covers the need to create an appropriate legal framework, promote greater private investment and develop ecosystems, public policies and legal frameworks that facilitate social investment.

In the online presentation of the study last October to the SEGIB (Secretaría General Iberoamericana — Ibero-American General Secretariat), Escolano pointed out that it was important for Latin America to approach “the short-term with determination and the long-term with an open mind” and recalled that the report recommended reforms for competitiveness, resilience and economic sustainability.


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