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ECLAC: poverty reduction stalls in LatAm

Argentina excluded from the rankings due to a lack of official figures for 2013

Poverty reduction has stalled across Latin America, barely budging since 2012, as economic growth has slowed, the United Nations’ economic body for the region said yesterday in its annual report.

Argentina was left out of the ranking altogether. The country’s poverty and destitution figures for 2013 were not included in a reflection of the federal government’s move to stop publishing the data.

The UN’s Economic Commission for Latin America and the Caribbean (ECLAC) said 28 percent of the region’s population, or 167 million people, were mired in poverty in 2014. The figure remained stable between 2012 and 2013, when it affected 28.1 percent of the population. Destitution, meanwhile, rose to 11.7 percent in 2013 from 11.3 percent in 2012, which supposes an increase of three million people, raising the total to 69 million.

“It seems countries were unable to sufficiently take advantage of the recovery from the international financial crisis to strengthen social protection policies that reduce vulnerability from economic cycles,” said Alicia Barcena, the head of Santiago-based ECLAC. “Now, in a scenario with a possible reduction of available fiscal resources, more work is needed to strengthen these policies.”

One of the worst-affected countries was Venezuela, which saw its poverty rate climb by 6.7 percentage points from 25.4 percent to 32.1 percent and the destitution rate increased by 2.7 percentage points, from 7.1 percent to 9.8 percent, both between 2012 and 2013. ECLAC highlighted the “upswing” inflation in the country, which surged from 20.1 percent in 2012 to 56.2 percent in 2013, and that Venezuela was the only country to report a fall in average real wages (of 4.1 percent)

Despite the lack of progress in the regional average, five of the 12 countries with available information through 2013 showed declines in poverty. Paraguay improved the most, reducing poverty to 40.7 percent in 2013 from 49.6 percent in 2011, followed closely by El Salvador (to 40.9 percent in 2013 from 45.3 percent in 2012), Colombia (to 30.7 percent in 2013 from 32.9 percent in 2012) and Peru (to 23.9 percent in 2013 from 25.8 percent in 2012).

Argentina was hardly alone in its lack of data for 2013. Bolivia, Guatemala, Honduras, Mexico and Nicaragua also were not included in the report.

The last time Argentina published poverty and destitution data was in October 2013, corresponding to the first semester of 2013. At that time, the INDEC statistics bureau estimated poverty was 3.7 percent (450,000 homes) and destitution at 1.4 percent (367,000 people). Both figures were questioned by opposition leaders and private consultancies.

Back in December 2013 when INDEC still published poverty data, ECLAC said Argentina had the lowest poverty rates and the second lowest destitution levels in the region, followed by Uruguay. According to the ECLAC report, Argentina managed to reduce poverty from 5.7 percent to 4.3 percent from 2011 to 2012.

Argentina’s highlights

Even though the country failed to provide data, ECLAC higlighted its efforts to reduce poverty. All the countries in the region saw a decline in multidimensional poverty between 2005 and 2012, with the sharpest seen in Argentina, Uruguay, Brazil, Peru and Chile.

“Between 2005 and 2012 the rate of poverty declined in all the countries, especially in Peru, Bolivia, Argentina and Uruguay, with percentage decreases between 1.7 percent and 2.8 percent per year,” ECLAC said. “Bolivia, Argentina and Brazil saw striking improvements in inequality reduction in 2002-2008.”

Argentina ranks among the highest in the region when looking at how much of the population consider themselves to be middle or lower-middle class, according to the report. Up to 54 percent of the citizens said to see themselves as middle class, the highest figure in the region, while 32 percent described themselves as lower-middle class. In the region, 38 percent said they consider themselves middle class, 31 percent lower-middle class and 26 percent lower class.

For its part, Brazil stands out as the country where expectations for the well-being of children is highest. Next are Chile, Argentina, Costa Rica, Venezuela and Ecuador.

“In countries with less poverty and greater relative development there is a greater sense of identification with the middle class. And expectations of economic progress are higher among individuals who identify with the middle class than among individuals who feel they are in the lower class,” ECLAC said.

The increase in social expenditure in Argentina was also highlighted by ECLAC, saying the country’s spending on social assistance rose by almost 85 percent from 2000 and 2007. Brazil tripled its spending, in Chile it went up 5.5 percent, in Colombia it doubled between 2004 and 2007 and in Costa Rica it has increased by more than 75 percent since 2002. An increase equivalent to 5.3 percentage points of GDP was reported in the region.

Herald staff

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