Commentary
Ensuring that cities’ perspectives shape international discussions at this year’s forums is not just equitable; it is likely to produce better outcomes.
Liliana Gamboa, Marissa Jordan
{
"authors": [],
"type": "pressRelease",
"centerAffiliationAll": "",
"centers": [
"Carnegie Endowment for International Peace"
],
"collections": [],
"englishNewsletterAll": "",
"nonEnglishNewsletterAll": "",
"primaryCenter": "Carnegie Endowment for International Peace",
"programAffiliation": "",
"programs": [],
"projects": [],
"regions": [
"South America",
"North America"
],
"topics": [
"Economy"
]
}
REQUIRED IMAGE
Press Release
Latin America’s recovery requires both market and state
The global financial crisis was a result of failures in both the market and state—markets created financial turmoil and regulatory agencies failed to detect risks and correct imbalances. As Latin American countries emerge from the crisis, both the market and state are needed to ensure sustainable growth.
Published on Nov 11, 2009
WASHINGTON, Nov 11—The global financial crisis was a result of failures in both the market and state—markets created financial turmoil and regulatory agencies failed to detect risks and correct imbalances. As Latin American countries emerge from the crisis, both the market and state are needed to ensure sustainable growth, says a new paper by Alejandro Foxley, former foreign and finance minister of Chile.
Analyzing the successes and mistakes of economic policies over the past twenty years, Foxley makes recommendations for Latin America to achieve development that creates fewer inequalities and increases the capacity for innovation.
Recommendations
- Establish more competitive markets: The economic crisis should not serve as an excuse to increase protectionism. Latin American economies need to move toward a greater reliance on the market and more competition in industries known for monopolies or oligopolies.
- Restructure state institutions: To compete globally, governments need to retool economies to spur development and create new, better-quality jobs. High-quality education that creates a well-trained workforce should be a priority.
- Develop a welfare society: Policies should make it easier for women and other vulnerable groups to get jobs and provide equal access for all children to education.
- Create public-private partnerships: States need to increase the involvement of the private sector in providing basic social services, including education, health, and housing.
“As they emerge from the most recent crisis, Latin American economies need both—more market and more state. More market will enable them to exploit new opportunities through bilateral or multilateral trade agreements, and expand public-private partnerships,” writes Foxley. “A more intelligent state, acting as a catalyst for development, could encourage creativity and foster entrepreneurship.”
###
NOTES
- Alejandro Foxley is a senior associate in the Carnegie International Economics Program. Before joining Carnegie, Foxley was minister of foreign affairs of the Republic of Chile (2006–2009). Between 1998 and 2006, he was a senator of Chile, serving as chairman of the Finance Committee and the Permanent Joint Budget Committee. Previously, he was also Chile’s minister of finance and concurrently served as a governor of the Inter-American Development Bank and the World Bank (1990–1994).
- The Carnegie International Economics Program (IEP) monitors and analyzes short- and long-term trends in the global economy, including macroeconomic developments, trade, commodities, and capital flows, and draws out policy implications. The initial focus of the Program will be the global financial crisis and the policy issues raised.
- The International Economic Bulletin draws on the expertise of Carnegie's global centers to provide a candid view of the economic crisis and its political implications. Addressing the momentous challenges of the economic downturn will require objectivity, and the ability to analyze the political dimensions of reforms around the world.
- Press Contact: David Kampf, 202/939-2233, dkampf@ceip.org
Carnegie does not take institutional positions on public policy issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of Carnegie, its staff, or its trustees.
More Work from Carnegie Endowment for International Peace
- Cities Have a Crucial Role to Play in Advancing Climate Mobility Priorities
- The Iran War Isn’t the Only Challenge Facing Saudi Arabia’s Vision 2030Commentary
As the monarchy appears to question its grandest projects, the state could do with more critical debate than rote cheerleading.
Andrew Leber
- From Labor Scarcity to AI Society: Governing Productivity in East AsiaArticle
The debate over AI and work too often centers on displacement. Facing aging populations and shrinking workforces, East Asian policymakers view AI not as a threat, but as a cross-sectoral workforce strategy.
Darcie Draudt-Véjares, Sophie Zhuang
- Governing AI in the Shadow of Giants: Korea’s Strategic Response to Great Power AI CompetitionArticle
In its version of an AI middle power strategy, Seoul is pursuing alignment with the United States not as an endpoint but as a strategy to build industrial and geopolitical leverage. Whether this balance holds remains an open question.
Darcie Draudt-Véjares, Seungjoo Lee
- Is China’s High-Quality Investment Output Economically Viable?Commentary
China’s rapid technological progress and its first-rate infrastructure are often cited as refuting the claim that China has been systematically overinvesting in non-productive projects for many years. In fact, as the logic of overinvestment and the many historical precedents show, the former is all-too-often consistent with the latter.
Michael Pettis
