How much should the Latin American economy grow to combat poverty?

The World Bank forecasts in this study, published last April, growth for the region of 1.4% in 2023 and 2.4% in 2024, which is not enough “to alleviate poverty or dissipate social tensions,” according to the conclusions.

The worst prospects are in Chile, a country for which the World Bank forecasts an economic contraction of 0.7% in 2023; and Argentina, for which he estimates stagnation.

“We have lost several years due to the pandemic,” the expert noted.

The World Bank report shows that the poverty rate in the region increased from 29.7% in 2019 to 34.4% in 2020, with some 19 million people who entered this situation, which represents a setback of seven years or more compared to previous data.

“Obviously, there are more policies to help families in various dimensions. I always say that improving public education, for example, is the best way to promote social mobility,” but “in the long term, the way that has reduced poverty in most effective way has been economic growth.

“We have to work on both fronts,” he says, “at the family level, to ensure that we have a well-established, well-financed social protection network, but the long-term issue is growth,” he stresses.

Regional integration

Regarding the call made by the Brazilian president, Luiz Inácio Lula da Silva, to resume regional integration, Maloney believes that these initiatives promote economies of scale, so that Latin American companies can expand and have access to local markets.

“Exporting to our neighbors is good preparation for exporting to the world in general, if you think about it strategically,” he adds.

In the long term, he points out, the objective is “to achieve more transfer of technology knowledge to the region and that comes from the countries on the technological frontier.”