By: Hugo Marcelo Balderrama - 13/01/2025
Guest columnist.In the mid-2010s, specifically in 2015, the World Bank stated that, for the first time in human history, extreme poverty had been reduced below 10%, to 9.6% to be exact. If we compare this data with that of 1990, when extreme poverty was close to 37%, we can say that the fall of the Soviet bloc and the beginning of globalization have been the most important factors in lifting the world out of misery and hunger, which, by the way, are the natural conditions of man.
This magnificent experience is accompanied by other benefits, such as better nutrition, longer life expectancy and higher literacy rates. All this was achieved not thanks to governments, but in spite of them, since the classic interventions in such sensitive issues as the financial and monetary sector were not absent. Policies that generated fictitious booms and subsequent recessions.
However, there is one region that has decided to get off the train of globalization and a world in the midst of a technological revolution: yes, us: Latin America. A phenomenon that had already been predicted in a 2005 report entitled: Latin America in 2020, prepared by academics from Georgetown University and the National Intelligence Council of the United States, the work emphatically stated:
Latin America will continue to miss out on greater integration into the global economy because of government inefficiency and a growing risk of populist leaders emerging who will exploit the gap between rich and poor to consolidate their power.
Indeed, populist leaders, under the umbrella of the Sao Paulo Forum, took over much of the region to establish dictatorships and governments, which, while maintaining a certain degree of institutionality, placed their entire foreign policy at the service of 21st Century Socialism. What were the results?
Hugo Chávez took over the Central Bank of Venezuela in 2007. After his death in 2013, Maduro, Cuba’s appointed successor, inherited inflation levels of 40% per year. By 2017, the Chavista regime’s monetary mismanagement had left inflation at 438% per year. However, the worst was yet to come, as between 2018 and 2019, the Chavista regime unleashed inflation of 65,000% and 19,000%, respectively.
Faced with this bleak outlook, Venezuelans began to leave their country en masse in 2014. By 2022, 6.8 million Venezuelans were residing abroad, many of them as refugees. According to R4V, a platform of the United Nations High Commissioner for Refugees and the International Organization for Migration, there were 7.77 million Venezuelan refugees and migrants in the world at the beginning of 2024.
My native Bolivia is another of the nations that fell prey to 21st Century Socialism, as nationalization and the populist authoritarianism of coca grower Morales and his accomplices have caused production to decline in practically all areas. Not only has industrialization not advanced, but today Bolivia depends even more on the export of raw materials.
The illusion of economic growth, which many called a "miracle", was based on a public spending program and the manipulation of interest rates through Law No. 393 on Financial Services. State-owned companies are inefficient and running deficits. For their part, private companies, due to insecurity and fear of tax terrorism, have reduced their investment to a minimum, and many have even moved their operations to Paraguay and Uruguay.
In conclusion, it is a shame that while the nations of the world, including much of Africa, are seeking to improve the competitiveness of their economies, our countries are still held hostage by a gang of criminals.
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