(27 September 2010) Latin America and the Caribbean need to invest more to increase employment and thus close social gaps, stated ECLAC Executive Secretary Alicia Bárcena during the Conference on Investment for Employment and Development in Latin America and the Caribbean inaugurated today in Santiago, Chile.
The event is organized by the Government of Chile in conjunction with the Economic Commission for Latin America and the Caribbean (ECLAC) and the Organization for Economic Cooperation and Development (OECD) and gathers policymakers, international experts and other interested parties such as companies, workers and civil society.
During the inaugural session, Bárcena spoke of the importance of investment for the productivity and development of the region's economies. Rodrigo Álvarez, Undersecretary of Finance of Chile, Richard Boucher, Deputy Secretary General of the OECD, Jean Philippe Pening Gaviria, Director of Infrastructure and Sustainable Energy of Colombia's National Planning Department, and Juan Manuel Cabrera Hernández, Ambassador of Spain in Chile, also participated in the inauguration.
"As we assert in the document Time for Equality: Closing Gaps, Opening Trails, which we presented this year during the Thirty-third Session of ECLAC, our countries should attain growth rates compatible with the need to create more quality employment in order for the labour market to become a fundamental vehicle for achieving fairer societies," said Bárcena.
The United Nations official explained that the recent global crisis has had a significant impact on the region, given that Latin America and the Caribbean have yet to recover the investment rates of the 1980s.
Foreign direct investment (FDI) in the region fell 41% in 2009, totaling US$78 billion, and it is expected to rebound to some US$100 billion this year.
"FDI has brought multiple benefits for Latin American economies, but it is not enough to change the productive structures of our countries," said Bárcena. The concentration of productive improvements in a limited number of industries has led to an enormous heterogeneity, which in turn has increased the gap between large and small companies, as well as in wage levels among workers with different levels of qualifications, she added.
"Economic development in Latin America will not be inclusive as long as the productivity of small companies does not increase at a rate that allows them to substantially improve the wages and labour conditions of their workers," she stated.
Incorporating small and medium companies in the value chains of transnational corporations is an important instrument to reach this goal.
Lastly, the Executive Secretary of ECLAC warned that "the presence of the State is essential to ensure a macroeconomic environment and public policies that encourage investment, innovation and quality job creation."
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