From the Washington to the Latin American Consensus

The COVID-19 crisis has dramatically affected Latin America. The region has become over the past few months the epicenter of the pandemic, and it will experience a contraction in economic activity of 9.1 percent according to the U.N. Economic Commission for Latin America and the Caribbean (ECLAC) or 9.4 percent according to the International Monetary Fund.

It is not only the worst regional recession in its history, but also the worst in the world after Western Europe. As a result, in the most pessimistic scenario—which is the most likely now—ECLAC estimates that poverty levels will increase from 30 to 36 percent of the population; that is, it will affect an additional 36 million Latin Americans.

All of these adverse trends require a deep rethinking of the development model that Latin America has followed since the market reforms that were adopted in the late 1980s or early 1990s in most countries. For this reason, a group of 31 Latin American and Spanish academics and former public officials set out to propose what we call the “Latin American Consensus 2020”, that is, an alternative to the Washington Consensus that served as a framework for the market reforms, the results of which have been clearly unsatisfactory.