Latin America

Despite predictions of the worst, Latin America has managed to survive the aftershocks sent by the Asian Crisis. With a regional GDP of 81.6 billion, the Americas are economically stable. But do these numbers really translate stability?

Last year, its member country employment rates at a high with almost everyone employed, with minimum inflation on its respective currencies. Yet 37% of the population in the region is living below the poverty line, while 16% in extreme poverty. With the cities littered with street children, a crime rate of nearly 69% and an infant mortality rate of 20 per 1,000, one can almost see the living conditions. Why is that?

It depends on how one defines poverty. Economic-wise, the Latin Americas are faring much better than it's Asian counterparts. Export, which the countries rely heavily on, never goes lower than 60%, depending on the size of the country. Multi-national companies are opening instead of leaving.

But these MNCs are mostly foreign owned, and take up the bulk of businesses in the region. A virtual wonderland for investors, Latin America offers cheap labor, minimal government interference, and almost no environmental laws. Each member country also faces its swelling IMF debt, with Mexico, who borrows after every presidential term, highest. With no labor and environmental policies, and a government too busy paying up debts to impose social reforms, it is vulnerable to exploitation.

Simply enforcing new rules and passing new laws is not the answer. If the government decides to hike up the minimum wage, upgrade the working conditions, and impose new environmental laws, these MNCs will immediately pack up and move to a place where business is cheaper. Without these companies, the region will collapse, with neither a strong industrial or agricultural base to fall back on.

The problems started when the Latin Americas dictators fell and the region gradually lapsed to democratic rule. The transition was not an easy one to make. Some countries, after years of being colonized, fell into mismanagement by the next government, others found their treasuries left almost penniless, cleaned out by the previous tyranny.

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