(10 October 2012) Today the Executive Secretary of the Economic Commission for Latin America and the Caribbean (ECLAC), Alicia Bárcena, proposed to place equality at the heart of the region's economic and social discussions, thereby breaking with the economic paradigm that has prevailed for at least three decades.
The proposal contained in the document Structural change for equality: an integrated approach to development involves weaving capacity-building, technical progress and full opportunities into the production structure and social fabric.
This document deepens and broadens out what ECLAC put forward two years ago in the document Time for equality: closing gaps, opening trails.
During a lecture delivered by Ms. Bárcena at the beginning of the Seminar on structural change for equality: the view from Mexico, she said that politics and the State must take on a central role once more if countries are to achieve sustained growth with equality in the long term.
As he opened the seminar, the Dean of the Autonomous University of Mexico (UNAM), José Narro, recognized Alicia Bárcena as an exceptional Mexican and UNAM graduate who has made the institution proud.
Mr. Narro stated that "I truly mean it when I say that we are delighted to meet with her and hear about her achievements and the work she carries out in ECLAC because of that capacity to bring people together within the region and beyond".
The UNAM Dean recognized the contribution of the document presented in August during the thirty-fourth session of ECLAC in El Salvador, as the Commission's strategic proposal therein coincides with the University's vision of the need to change the economic model to ensure that the fight against poverty focuses on people rather than institutions or programmes.
According to the Dean, "I celebrate the launch of the ECLAC document, this seminar and the fact that the Faculty of Economics and our University Programme of Development Studies are interested in continuing to provide evidence so that the country can do what it needs to: namely combating inequality and poverty".
The ECLAC proposal states that Latin American and Caribbean countries must avoid primarization of their economies and invest in an industrial policy that focuses on knowledge- and technology-intensive sectors that provide value added, increase productivity and generate quality jobs.
Alicia Bárcena explained that investment is the crucial link that connects short with long term, although investment dipped sharply during the crisis in the early 1980s and has not recovered the flows of up to 25% of GDP recorded in the 1970s. Public investment must not be the adjustment variable, has to be protected from the manifestations of the business cycle and should be closely linked to industrial policy objectives in order to sustain a long-term growth path.
Ms. Bárcena also tackled the issue of the costs of the 1980s debt crisis that gave rise to the lost decade and the predominance of the market over the State, which has become deeply entrenched in our societies.
Before the crisis in Europe, the Executive Secretary of ECLAC warned that destroying the social fabric and the welfare state would have very high costs in the long term, as it did in Latin America.
According to Ms. Bárcena, ECLAC is proposing that equality should be the aim, structural change the path, and policy the instrument. This results in major State policies: sustainable industrial policy, macroeconomic policy for development and social and labour policies.
Industrial policy must be explicit and have a long-term vision to invest in technology and innovation and provide tax stimulus, as well as credit to promote investment of small and medium-sized enterprises.
Macroeconomic policy must be concerned with growth and go beyond nominal stability and employment. Fiscal, monetary and foreign-exchange policies must not only promote nominal stability and smooth the economic cycle, but most also concern themselves with long-term impact.
"Not all social matters are about social policy, and not all production matters are about production policy", stated Ms. Bárcena. In social matters, we need redistribution policies and capacity building, where a rethink of education systems leads to the adoption of new technologies.
Referring to the lecture, the UNAM economist and academic, David Ibarra, said that the ECLAC proposal presented at the thirty-fourth session in El Salvador could trigger a new notion of economic and social policy in Latin American countries.
The seminar will be held until Thursday 11 October. On the second day, participants will discuss industrial policy and structural change, employment and social development, as well as planning, State and development.
For queries, in Mexico City contact María Luisa Díaz de León. E-mail: marialuisa.diaz@cepal.org; Telephone: (52 55) 41705665.
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