Mario Cimoli (Director of the Division of Production, Productivity and Management, ECLAC)
Latin America went through a very favorable period of economic growth and income distribution since 2004. But the region failed to do its homework regarding structural change, industrial policy and productivity growth. The situation varies widely across countries: Some of them did much better than others. But in general productivity growth in the coming years should be accelerated in order to sustain both economic growth and the drive towards equality. The commodity boom resulted in just a feeble increase in investment. Most of the boom went to consumption. The increase in social expenditure helped to reduce poverty, but as the figure below shows, it would no longer be possible to increase social expenditure at a higher rate than the GDP. The politics of productivity should be brought back again in the public debate. This means that industrial policy should be at the top of the policy agenda in the near future.
- Source: CEPALSTAT and World Bank, various years.