The state of South American economies in 2017
An OECD report entitled Latin American Economic Outlook 2017 has highlighted ongoing problems with reducing poverty and inequality in the region, with 60% of working-age young people deemed poor.
In addition, the number of people deemed middle class has, after a temporary rise, apparently been shrinking, notably in countries with the most fragile economic infrastructure.
South American young people don't trust their government
The disparity between the rich and the poor in South American countries is stark. Seven million South Americans fell into poverty in 2015, pushing the poverty rate up to 29.2%, with some 17.5 million people living in poverty.
The middle classes steadily increased in number during the period of economic growth, peaking at 25-30 million people. However, one in three of these people are expected to return to poverty at some point.
According to the OECD, Mexico and countries in Central America and the Caribbean are relatively resistant to recession, but the weaker a country’s policy framework the worse the negative impact.
The region has a large population of young people, who represent a powerful potential work force, which is, of course, a hopeful factor. There are 163 million people aged between 15 and 29 in South America, and their participation in the employment market can surely be expected to have a significant economic impact.
However, although there has been improvement in education systems over recent years, they remain below the desired level. In practice, the aforementioned 163 million young people are not all in secure regular employment, and more that 100 million young people are living in poverty. This tendency is most evident among young women.
The fate of South America is likely to be determined by whether it is possible to strengthen the education and training of young people in a way that enables the creation of economic opportunities.
The OECD suggests that many South American young people are harboring feelings of frustration and distrust toward their governments. The report says that only 36% of South American young people “trust the transparency of elections,” which is around a half of the average (62%) for other member countries.