TERRITORIO Y GLOBALIZACION: LOS DESAFIOS DE LA TRANSFORMACION PRODUCTIVA EN UN NUEVO ESCENARIO INTERNACIONAL Mario Pezzini, Director of the OECD Development and Special Advisor to the OECD Secretary General on Development
CONTEXT
Shifting Wealth is reshaping the world economy The Three Speed World in the 199s Source: Perspectives on Global Development 21: Shifting Wealth, author s calculations based on World Bank Data 29 Note: This map is for illustrative purposes and is without prejudice to the status of or sovereignty over any territory covered by this map.
The Three Speed World in the 2s Source: Perspectives on Global Development 21: Shifting Wealth, author s calculations based on World Bank Data 29 Note: This map is for illustrative purposes and is without prejudice to the status of or sovereignty over any territory covered by this map.
Labor productivity (constant dollars, year of reference:2) Labour productivity and social expenditure (1991-213) 1 9 United States; 4.46 Ireland; 32.52 Denmark; 29.8 8 Sweden; 27.32 Finland; 27.12 Australia; 33.4 7 Canada; 33.68 6 Singapur; 46.4 Hong Kong; 43.1 New Zeland; 31.7 5 4 Korea; 31.1 3 2 1 Ecuador; 47.29 Mexico; 48.7 Peru; 44.73 Chile; 5.45 Venezuela; 4.7 Colombia; 53.49 Costa Rica; 49.18 Uruguay; 41.87 Argentina; 42.28 Brazil; 52.87 5 1 15 2 25 3 Social expenditure (% GDP)
2 21 22 23 24 25 26 27 28 29 21 211 212 213 214 215 216 217 Latin America is on the look for inclusive and sustainable growth Panel A. GDP growth (%) Panel B. Poverty and indigence (millions of persons) 8 6 4 2 Latin America and the Caribbean Consensus Forecast Latin America and the Caribbean ECLAC Latin America and the Caribbean IMF OECD 23 21 19 17 15 13 11 9 7-2 5 22 28 21 211 212 213 214 215-4 Poor Indigent Sources: Panel A: For OECD figures the OECD Economic Outlook 99 database is used. For Latin America and the Caribbean ECLAC, IMF and Consensus Forecasts. Panel B: ECLAC Social Panorama of Latin America 215.
La contribución de América Latina al proceso de reequilibrio de la riqueza es relativamente modesta Contribution al PIB mundial 199-211 (%) Economías avanzadas América Latina África Subsahariana 18% 199-1995 Asia emergente Medio Oriente y África del Norte Resto del mundo 3% 25-212 9% 1% 4% 8% 5% 9% 6% 32% 19% 41% Fuente: American Economic Outllok (215)- Elaboración propia a partir de datos y agregados regionales de FMI (World Economic Outlook).
The Middle-Income Trap: common to several countries in the region GDP per capita (constant USD 199) 216 198 195 35 3 25 2 15 11 75 UMI 1 5 2 LI CHL URY ARG VEN CRI MEX COL BRA PER CHN SGP JPN KOR ESP PRT MYS Source: OECD/CAF/ECLAC (215), Latin American Economic Outlook 216 based on the methodology proposed by Felipe, Abdon and Kumar (212).
Beyond trade I: Expanding financial flows Loans from China & multinational organisations to Latin America (Millions USD) WB CAF IDB China 4 35 3 25 2 15 1 5 25 26 27 28 29 21 211 212 213 214 215 Source: OECD/ECLAC/CAF based on annual reports (CAF, IDB, World Bank) and Gallagher and Myers (214) for data on Chinese loans. Note: Chinese loans include mainly loans granted by the CDB and the CHEXIM. Loans from the World Bank are comprised of the IBRD and the IDA. CAF loans concerning credit commitments and IDB data include loans and approved guarantees.
Beyond trade II: FDI flows from China still low, but a growing opportunity Latin American Foreign Direct Investment inflows, 29-13 (%) China's outward FDI (21) Total FDI inflows to Latin America by sector, 29-13 4% 3% 1% Services Manufactures Natural Resources 15% Asia 8% Africa 1% 3% 65% Europe Latin America North America 6% 4% Oceania 2% % Brazil Mexico South America Caribbean Source: OECD/ECLAC/CAF based on data from national sources and China s National Bureau of Statistics.
PRODUCTIVIDAD
Productivity is lagging behind Productivity performance in Latin America (compared to US) Relative TFP by region (1961 = 1) LAC Korea Singapore Malaysia Thailand Hong Kong East Asia % 25 2 15 1 5 196 1963 1966 1969 1972 1975 1978 1981 1984 1987 199 1993 1996 1999 22 25 28 211 Source: IDB (214), Productivity and Factor Accumulation in Latin America and the Caribbean: A Database.
Weak innovation performance Patent applications per million people in selected countries, 213 Patents per million people 25 2 15 1 5 Source: Patent Cooperation Treaty, 213 data; OECD Indicators on Patents (database), OECD, www.oecd.org/sti/inno/oecdpatentdatabases.htm (accessed on 1 July 216).
5% of formal firms do not find the workforce with the skills they need Percentage of firms identifying difficulty filling jobs, 215 9% 8% 7% 6% 5% 4% 3% 2% 1% % Source: OECD/ECLAC/CAF (216 forthcoming), Latin American Economic Outlook 217: youth, skills and entrepreneurship based on Manpower Group (215).
this includes expanding and improving skills Projections of the population with tertiary education in China and Latin America, (number of people) LAC (high graduation) LAC (baseline) China (high graduation) China (baseline) 3,, 25,, 2,, 15,, 1,, 5,, 213 214 215 216 217 218 219 22 221 222 223 224 225 226 227 228 229 23 Source: OECD/CEPAL/CAF (215), Latin American Economic Outlook 216: Towards a new partnership with China
SOCIAL INCLUSION
The vulnerability of the middle class is still a threat for the region Latin American population by per capita income level (percentage of total population) Note: Socio-economic classes are defined using the World Bank classification: Poor = youth belonging to households with a daily per capita income lower than USD 4. Vulnerable = individuals with a daily per capita income of USD 4.-1. Middle class = youth from households with a daily per capita income higher than USD 1.. Poverty lines and incomes are expressed in 25 USD PPP per day (PPP = purchasing power parity). Source: OECD and World Bank (216b) LAC Equity Lab tabulations of SEDLAC (CEDLAS and the World Bank) and World Development Indicators.
Despite the recent socio-economic progress inequality in the region is still high Inequality income distribution in LAC (Gini index of disposable income) 212 (circa) 21-3.7.6.5.4.3.2.1 Note: LAC average is an unweighted average. Sources: OECD/IDB (216), Broadband Policies for Latin America and the Caribbean: A Digital Economy Toolkit, OECD Publishing, Paris. OECD (216), OECD Income Distribution Database, www.oecd.org/social/income-distribution-database.htm; Lustig et al. (216), The impact of taxes and social spending on inequality and poverty in Argentina (211), Bolivia (29), Brazil (29), Chile (213), Colombia (21), Costa Rica (21), Ecuador (211), El Salvador (211), Guatemala (211), Honduras (211), Mexico (21), Peru (29) and Uruguay (29): An overview, CEQ Working Paper, No. 47, CEQ.
Disparities are also high within countries Gini index of inequality of GDP per capita between regions within countries 213 2 PER COL CHL MEX BRA SVK CHN IRL TUR HUN KOR EST POL GBR CAN AUS CHE OECD31 ITA DNK AUT USA NZL FRA CZE DEU NOR PRT SVN ESP FIN JPN BEL SWE NLD GRC.5.1.15.2.25.3.35.4.45 Sources: OECD (216), OECD Regions at a Glance 216, OECD Publishing, Paris. http://dx.doi.org/1.1787/reg_glance-216-en and OECD (215), Multi-dimensional Review of Peru: Volume I. Initial Assessment, OECD Development Pathways, OECD Publishing, Paris. http://dx.doi.org/1.1787/9789264243279-en
Argentina Bolivia Brazil Chile Colombia Costa Rica Dominican Republic Ecuador El Salvador Guatemala Haiti Honduras Mexico Nicaragua Panama Paraguay Peru Uruguay LAC OECD And disconnected youth need to be re-engaged Males and females NEETs as a share of all youth 15-29, 214 a Female Male Gap 5 45 4 35 3 25 2 15 1 5 45 4 35 3 25 2 15 1 5 Note: OECD is the unweighted average of countries shown. LAC weighted average of 17 countries: Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Uruguay a) 211 for Israel, 213 for Chile and the United States. Youth aged 15-24 for Japan. Source: OECD/ECLAC/CAF (216 forthcoming), Latin American Economic Outlook 217, Youth, Skills and Entrepreneurship based on World Bank tabulations of SEDLAC (CEDLAS and the World Bank) and OECD LFS data..
Well-being indicators for Latin America shows several areas for further improvement Actual and expected well-being outcomes for the LAC region Expected outcomes for GDP level Actual outcomes Perceived honesty in elections Life satisfaction GNI per capita.5 Satisfaction with living standards Employment to population ratio, 15+ Perceived government corruption -.5 Share of vulnerable jobs Someone to count on -1 Improved sanitation facilities -1.5 Perceived safety Satisfaction with housing conditions Homicide rate Change in forest area Share of people reporting no health problems Life expectancy Literacy rates PM2.5 emissions Expected years of schooling Source: OECD/ECLAC/CAF (216 forthcoming), Latin American Economic Outlook 217, Youth, Skills and Entrepreneurship based on Gallup Organization (214), Gallup World Monitor (database); UNDP (United Nations Development Programme) (214), International Human Development Indicators (database), United Nations Development Programme, http://hdr.undp.org/en/data; UIS (UNESCO Institute for Statistics) (213), UIS Data Centre (database), United Nations Educational, Scientific and Cultural Organisation, http://data.uis.unesco.org/ ; United Nations Office on Drugs and Crime (UNODC 213), www.unodc.org, World Bank (214), World Development Indicators (database), Washington, DC.
Number of Labor Dispute Cases (thousand) Social capital at risk: Increase in labour disputes in China 8 6 4 2 Source: Cai and Wang (211) 1999 2 21 22 23 24 25 26 27 28 29
GOVERNANCE
The incidence of taxes and transfers does not contribute to reduce inequalities Impact of taxes and transfers on income distribution in Latin America and selected OECD economies (Gini indexes before and after direct taxes and transfers) Gini Index.7 Market income Disposable income.6.5.4.3.2.1 Denmark Iceland Germany France Korea OECD Canada Italy Spain Greece US Argentina El Salvador Mexico Ecuador Uruguay Chile LAC Costa Rica Bolivia Peru Guatemala Brazil Honduras Colombia Source: For Latin American economies Lustig et al. (216), The impact of taxes and social spending on inequality and poverty in Argentina (211), Bolivia (29), Brazil (29), Chile (213), Colombia (21), Costa Rica (21), Ecuador (211), El Salvador (211), Guatemala (211), Honduras (211), Mexico (21), Peru (29) and Uruguay (29): An overview, CEQ Working Paper, No. 47, CEQ. For OECD economies The OECD Income Distribution database (IDD), download date 25/4/216 OECD.stat.
Governance is a pending challenge Panel A. Perceptions of youth towards democracy and government in LAC: Trust in Governement Panel B. Total tax revenues as percentage of GDP, 214 21 215 35 3 25 2 15 1 5 % of youth population 4 % of GDP 3 2 1 No answer Don't know A lot Some Little None Source: Panel B; OECD/ECLAC/CIAT/IDB (216), Revenue Statistics in Latin America and the Caribbean 216, OECD Publishing, Paris. Panel A; OECD/ECLAC/CAF based on Latinobarómetro, 216.
TERRITORIAL DEVELOPMENT