Many Latin American countries are likely to reform their economic policies, particularly crisis-hit nations like Argentina, Venezuela and Brazil, according to business leaders and policy makers gathered at the 10th World Economic Forum.
Argentina and Venezuela are going to the polls later this year, while Brazil’s economic stalemate is forcing President Dilma Rousseff to think of different ways to reverse the country’s economic fortunes.
“With the October election, Argentina has a dramatic possibility for change,” Agustin Etchebarne, General Director, Fundación Libertad y Progreso, Argentina, said. “The recent cycle of populist policies has run its course. The only question is how deep the changes will be.”
If Venezuela holds parliamentary elections by the end of the year, the opposition is most likely to win, because President Maduro’s approval rating is under 30% and the economy is sliding ever more deeply into crisis.
“Opinion polls show that Venezuelans increasingly oppose government interference with private property,” said Luis Vicente Leon, President, Datanalisis, Venezuela. “I am absolutely certain that we will see important changes in our economic model.”
Thanks to economic pressure, Brazil has already undergone some changes. Abandoning a few populist programs to reduce fiscal imbalance is just the beginning.
“We had to adjust, because if we didn’t, the cost would have been even greater,” said Jose Augusto Coelho Fernandes, Director of Policy and Strategy, Confederação Nacional da Industria (CNI), Brazil.
Brazil now has many investment opportunities in infrastructure, where a solid regulatory framework is already in place, and its weaker currency is making exports more competitive.
Colombia has already made significant progress in dealing with the FARC rebels through negotiations that the government hopes will not only bring about peace but also make way for reforms.
The two sides have already reached agreements on land reform and put in place measures to fight illicit drugs.
“The peace process is not an end in itself. It is an opportunity to accelerate the country’s transformation,” said Oscar Adolfo Naranjo Trujillo, Minister of Post-Conflict, Human Rights and Security of Colombia.
Analysts are also expecting new generation leaders to take up policy-making positions in Cuba after the Communist Party holds its next convention in April next year.
International institutes, like the IADB and ELAC, are already lobbying hard to make Latin America pursue reforms and policies to improve productivity, address persistent inequality and promote inclusion.