The Strategic Potential of Latin America’s natural resources

If the right incentives, strategies and public policies are implemented, Latin America’s natural resources have the potential to become the main drivers of innovation, trade dynamism and economic growth based on higher productivity and creation of more and better jobs.

That was one of the main conclusions of the meeting “Opportunities and challenges of natural resources for stability, growth, inclusion and sustainability in Latin America,” held in Quito, organized by CAF—development bank of Latin America—and the Ibero-American General Secretariat (SEGIB).

The meeting also discussed the type of fiscal rules, exchange rate and monetary policies to preserve the well-being of the population at times of fluctuations in the price of commodities and changing conditions for access to external financing.

“Latin America needs to leverage the opportunities provided by natural resource-intensive sectors to boost productivity, investment and create jobs that help achieve long-term sustainable growth. This requires fostering innovation and reinforcing links in production chains, while ensuring fiscal stability,” said Luis Carranza, CAF executive president.

In addition, the Ibero-American Secretary-General, Rebeca Grynspan, noted: “We need a new consensus that looks to foreign markets as a source of investment and productivity, as an important source of wealth; but this new consensus must also look at the domestic market and appreciate the enormous potential for economic growth in the fight against poverty and inequality.”

Deputy Finance Minister Fabián Carrillo said the nation is recovering its economy. “We appreciate the support of international agencies, which shows that the confidence to invest in Ecuador has returned,” the minister said. He added that this process is based on fundamental values such as transparency, reactivation of production, improving institutions and rekindling a sustainable development model.

The event also included two panels related to macroeconomic challenges of commodity cycles and challenges for export diversification and productivity growth, featuring Augusto de la Torre, a former head economist of the World Bank for Latin America; Jorge Roldós, Deputy Managing Director of the International Monetary Fund, Yuri Parreño, Deputy Minister of Productivity; Guillermo Perry, from Universidad de los Andes, among others.