Third Summit of the Americas

Statement by the Executive Secretary of the United Nations Economic Commission for Latin America and the Caribbean (ECLAC), Dr. José Antonio Ocampo, at the Third Summit of the Americas.

Progress in macroeconomic management and in the integration into the world economy, and the increase in social spending, are the most encouraging features of the Latin American and Caribbean socioeconomic situation at the dawn of the XXI century. Nonetheless, the effects of these developments in terms of renewed investment and economic growth have been inadequate, and the challenges involved in creating high-quality employment and reducing poverty and social inequality are still immense. Social exclusion and the resulting perception of injustice not only raise ethical dilemmas, but also affect the stability of our democracies and our own prospects for development.

Economic progress in our countries has been hindered in recent years by the instability of the world economy. The international capital markets of relevance to our countries never fully recovered from the Asian crisis, and in recent months have also been affected by the volatility of technology stocks. The cyclical decline in prices has exacerbated the trend towards world oversupply of several raw materials of great importance to our countries, such as coffee.

The instability of the world economy largely reflects the enormous gap between the rapid development of international markets and the weakness of the global institutions that regulate them, as well as the fact that there are no effective mechanisms to ensure consistency between the macroeconomic policies of the major economies. The United Nations consultation on Finance for Development, which will end in the International Conference to be held in Mexico in 2002, offers an invaluable opportunity for a collective review, undertaken in a constructive spirit, of the shortcomings in the international trade and financing system that are undermining the prospects for successful integration of developing countries into the world order.

Furthermore, a balanced hemispheric free trade agreement that takes account of the large differences in size and development level between the economies of the hemisphere can become an important instrument for increasing both access to North American markets and our own intra-regional trade. This agreement should coexist with ongoing Latin America and the Caribbean integration processes, whose progress over the last decade has been outstanding, albeit not trouble-free. In turn, to ensure their continuing relevance in the context of FTAA, these integration processes should be expanded to include new economic issues such as macroeconomic coordination, financial cooperation, convergence between different regulatory systems and integration of physical infrastructure, as well as a wide range of environmental, social and political matters. Enhancement of all these regional cooperation schemes should be seen not as inimical to the construction of wider schemes of a hemispheric and global nature but rather as an essential element in the construction of a more balanced global edifice.

ECLAC has often pointed out that one of the most worrying features of the current international agenda is its incompleteness: the absence of issues of great interest to developing countries and the limited implementation of the social and sustainable development agendas agreed on at the United Nations global summits of the last decade, particularly the Millennium Summit. Consequently, it is with great satisfaction that we note the attention paid in this Summit to poverty reduction, international migration, sustainable development and the spread of information technologies, and the renewed emphasis on the central role of education in development.

Progress towards a more complete global and hemispheric agenda needs to be accompanied by further-reaching national development efforts. On the economic front, it is vital to increase domestic saving and investment, design preventive macroeconomic policies and consolidate our own financial development. Equally, these efforts need to be combined with an active production development strategy to facilitate the spread of technology, encourage innovation in all its forms, exploit the synergies between different companies and production sectors and support the development of small businesses in both urban and rural areas.

At the same time, development policies need to be relentless in its pursuit of social inclusion and equity. This requires comprehensive social and economic strategies to put an end to the structural conditions that perpetuate poverty and inequality: the poor distribution of education, working opportunities and access to productive assets, and the high demographic dependency rates of the poorest households. Access to educational and productive resources, to ensure real equality of opportunities; the extension of comprehensive and universal social security systems, to provide the population with the basic protections; the opportunity for the poorest sectors to express themselves politically and the development of participatory mechanisms to give them an active role in building their own future: these are the decisive elements in any strategy that seeks to strengthen the links between economic development, social development and democracy, historically so elusive in our region. Only in this way will we be able to create and spread prosperity.