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LatAm should tackle globalization backlash with integration, industrialization: ECLAC

Xinhua, November 24, 2016 Adjust font size:

Latin America should tackle the backlash against globalization by working to increase integration and industrialization, a Santiago-based United Nations agency said Wednesday.

The Economic Commission for Latin America and the Caribbean (ECLAC) warned that "dissatisfaction with globalization" is expected to contribute to "a 5 percent contraction in regional exports in 2016, marking four consecutive years of declines."

At a press conference presenting the ECLAC's annual report "Latin America and the Caribbean in the World Economy 2016," the agency's Executive Secretary Alicia Barcena urged regional countries to "diversify the productive structure of Latin America and the Caribbean to drive economic recovery."

"We must continue betting on diversification, on value chains, on production chains as the foundation and on intra-regional integration, which are more necessary than ever," said Barcena.

According to ECLAC projections, both foreign trade and intraregional trade will suffer in 2016.

"The reduction in intraregional trade, estimated at 10 percent, marks a much sharper fall than that of exports to the rest of the world ... with an especially negative trade dynamic among South American economies," the report said.

The region's share of global exports of goods and services "has stagnated at around 6 percent in the last 15 years, and has lost ground, in the case of high-tech goods and business, financial and telecommunications services, when compared with developing Asia, and China in particular," the report said.

To counter the trend, the report recommends greater diversification and integration, among other measures.

The report also "analyzes the potential effects of the Trans-Pacific Partnership (TPP), the approval of which is increasingly uncertain."

If adopted, the mega free-trade agreement "would represent 38 percent of global Gross Domestic Product (GDP) and 24 percent of global trade in goods," according to the ECLAC. Endi