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AmericasMarch 1 2016

Latin America enters a new age of pragmatism

Economic difficulties and low commodity prices are forcing Latin America into a new age of pragmatism, as populist policies fall out of favour amid stagnant living standards, and worries emerge about the region's reliance on Chinese investment.
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Latin America enters a new age of pragmatism

Latin America’s ample natural resources have been both a blessing and a curse. They have invigorated commodities exporters during the good times, but had a torpid effect on many governments’ reform agendas. And, over the past decade, the commodities-fuelled economic boom experienced in the region has helped bring about a new era of populist rhetoric that has failed to permanently tackle the regime’s social inequality.

Now that oil prices have dived and global demand for raw material is languishing, governments’ balance sheets are struggling to attract the international capital they need. Discontent with political leaders is also palpable. From the result of Argentina’s presidential election and its new pro-market agenda, to Venezuela’s angry turn against the ‘Chavista’ government whose policies led to a 720% inflation rate, to Brazilians’ indignation at the widespread corruption scandal that has brought the country to a standstill, Latin America appears to be at a turning point, with its most troubled economies attempting to build a sustainable way out of this crisis. 

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Silvia Pavoni is editor in chief of The Banker. Silvia also serves as an advisory board member for the Women of the Future Programme and for the European Risk Management Council, and is part of the London council of non-profit WILL, Women in Leadership in Latin America. In 2019, she was awarded an honorary fellowship by City University of London.
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