Shortly after he was elected Uruguay’s first left-leaning president, Tabaré Vázquez declared that, “We have to reconstruct the future from the limitations of our own times.”
Reconstruction and transformation are occurring across Latin America. A “pink tide” has brought politicians like Vázquez to center stage, posing a challenge for North America and Europe. Reform and high commodity prices are buoying the region. Latin America’s economies are doing better now than they have in a long time.
But reconstruction doesn’t happen overnight. The “limitations” that Vázquez spoke of are vast. Latin America is still far from being able to compete with the might of China or India. And it continues to have the widest gap between rich and poor. The richest 10% of its people earn nearly half the total income, while the poorest 10% earn just 1.6%. In contrast, the top tenth in industrialized countries earn 29.1% of total income, while those in the bottom tenth earn 2.5%.
Across Latin America and the Caribbean, one in four people survive on less than $2 a day. Fifty million – equivalent to the entire population of the United Kingdom – cope on less than $1. Moreover, 14% of the region’s inhabitants lack enough income to afford basic healthcare. Perceptions of corruption and inefficiency are high, underpinning weak public trust in institutions, while infrastructure investment has recently declined sharply.