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Event with Latin American and Caribbean Countries Stresses the Importance of Guaranteeing a Universal Social Protection System

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10 July 2020|Press Release

ECLAC’s Executive Secretary, Alicia Bárcena, participated in a side event at the United Nations High-level Political Forum on COVID-19’s socioeconomic impacts in the region and policy responses for building back better.

Building back better means doing so with equality and sustainability, with a social compact that includes a new equation between the State, the market and society that would allow for attaining a universal system for social protection and for accessing basic public goods, Alicia Bárcena, Executive Secretary of the Economic Commission for Latin America and the Caribbean (ECLAC), affirmed today.

The regional Commission’s most senior representative participated in a side event at the United Nations High-level Political Forum 2020 (HLPF), which is taking place virtually this July, entitled The 2030 Agenda for Sustainable Development in the new global and regional context: Scenarios and projections in the current crisis in Latin America and the Caribbean, organized by ECLAC and the Permanent Mission of Mexico to the UN.

Participating along with Alicia Bárcena were Ambassador Juan Ramón de la Fuente, Permanent Representative of Mexico to the UN; Pilar Garrido, Minister of National Planning and Economic Policy of Costa Rica; Luz Keila Gramajo Vílchez, Secretary of Planning of Guatemala; and Markova Concepción Jaramillo, Presidential Commissioner for the Voluntary National Review and designated Permanent Representative of Panama to the UN.

Additional participants included Juan Daniel Oviedo, Director of the National Statistical Administrative Department (DANE) of Colombia; Rochelle Whyte, Senior Technical Advisor to the Director General of the Planning Institute of Jamaica; and Laura Giannecchini, Institutional Development Coordinator of the Latin American Campaign for the Right to Education (CLADE), on behalf of the Civil Society Participation Mechanism in the Sustainable Development Agenda and the Forum of the Countries of Latin America and the Caribbean on Sustainable Development.

In her remarks, Alicia Bárcena called on the region’s countries to commit to a universal social protection system – which is what was lacking in the crisis produced by the coronavirus (COVID-19) pandemic – with universal progressive policies that would allow for applying direct taxes on wealth, combatting tax evasion, reviewing tax expenditures that are nearly 3.7% today, and bolstering investment that is low in carbon and high in terms of employment.

She also called for guaranteeing access to information, participation and justice with regard to human rights, based on democratic governance, and she stressed the importance of extending financial support to middle-income countries via more liquidity (special drawing rights), concessional funding and debt relief, particularly for Caribbean countries.

“We must move towards greater regional integration in the face of a distinct global economic geography,” she underlined.

ECLAC’s highest authority reviewed the difficult context seen in the region, which will suffer the biggest economic contraction in a century with a 9.1% fall in 2020. Trade will shrink by 20%, while remittances will drop by 20% as well. She added that fiscal space is limited, with a taxation rate of 23% versus the 34% seen among the members of the Organization for Economic Cooperation and Development (OECD) and very high tax evasion that amounts to 6.1% of GDP.

“All of this gives us very little room to be able to act, to be able to carry out our long-awaited 2030 Agenda, and to make progress on other priorities in the region,” Alicia Bárcena stated.

She noted that unemployment will rise from 8.1% to 13.5%, adding 18 million people to the ranks of the unemployed to total 44 million, while 54% of people in the region work in informal conditions, 60% of whom are women.

She added that the social impact will be very harsh, with poverty affecting 230 million people and extreme poverty afflicting 96 million people who, in addition, are vulnerable to experiencing severe food insecurity.

The senior United Nations official highlighted that, in order to confront all these scourges, ECLAC proposes an emergency basic income equivalent to one poverty line ($147 dollars) for six months, at a cost of 1.9% of GDP, along with an anti-hunger grant equivalent to 70% of one extreme poverty line ($57 dollars), which would cost 0.45% of GDP.

She added that, according to the Commission’s calculations, there will be a loss of 2.7 million companies, which represent 19% of the business fabric in the region. Therefore, she indicated, ECLAC proposes a subsidy for microenterprises and expanded credit for small and medium-sized enterprises, at zero interest and for a two-year term. The Commission also recommends providing monthly contributions to 15 million independent workers.

Alicia Bárcena recalled that ECLAC has put the COVID-19 Observatory at the disposal of countries in response to a request by the Community of Latin American and Caribbean States (CELAC), which Mexico currently presides over. The Observatory provides follow-up of the measures that the region’s 33 countries are taking to confront and mitigate the effects of the pandemic in seven areas: movements within and between countries, health, economy, employment, social protection, education and gender.

“This Observatory gives an account of all that countries are investing, which is a great deal, what type of measures they are taking, and how much it is costing them in terms of direct fiscal efforts; and also of the reorientation of the budget and public spending to strengthen the measures that enable the pandemic’s impacts to be addressed,” she explained.

The senior official also presented the Regional knowledge management platform for the Sustainable Development Goals (SDG Gateway), an interagency effort made in response to a petition by the UN Secretary-General, António Guterres, and to a decision by the United Nations Economic and Social Council (ECOSOC) to create regional knowledge management hubs to address national needs related to the 2030 Agenda. As Bárcena explained, this is a meeting and reference point for all information related to the sustainable development agenda and follow-up on progress and achievements in its implementation.  

“The analysis tells us that there is an important red flag, that we are not going to achieve many of the 17 Sustainable Development Goals. We need a change to the development model that is aligned with the 2030 Agenda, with an energy transition, digital connectivity, regional production integration, a strengthened care economy and nature-based solutions, while always keeping in mind our historic, transformative agenda, with a vision for the future,” she concluded.