Latin America has suffered from decades of political populism, with mostly catastrophic results, including sovereign defaults and widespread poverty. More recently the region’s leading countries have embarked on pro-business and investment policies, resulting in better outcomes – economic growth and rising standards of living.
But there are always exceptions. Venezuela has been an outlier for some time, with president Hugo Chavez using oil revenues to fund populist social programmes rather than engaging in reform. Venezuela’s political future is currently unclear, with Mr Chavez battling cancer and elections due in October, but long-term sustainable development depends on creating a more rational economic environment.
