Brazil Will Be a Global Leader in Open Banking and Finance, Industry Experts Predict

Brazilian real money notes

An Open Banking Excellence Campfire shone a light on payment initiation in Brazil and addressed the topic of the country’s Open Banking ecosystem. Guests included representatives of Mastercard, Brazil’s Central Bank, Itaú Unibanco and more.

 

Brazil’s Open Banking and Finance ecosystem will soon be the largest in the world, according to speakers at an industry event. Open Banking Excellence (OBE), the global centre of community and knowledge, driving change in Open Finance, gathered key players in the finance industry around its digital Campfire to celebrate the launch of payment initiation in Brazil and discuss the future ahead.

Over the last 12 months, Brazil has moved at an astonishing pace as it built a world-class Open Banking and now Open Finance ecosystem. So far in 2022, Brazil’s National Monetary Council, together with the Central Bank of Brazil, issued a resolution that officially launched an Open Finance project in the country and Mercado Pago became the first payment initiator in Brazil.

OBE founder Helen Child spoke to Thomas Camargo, Vice President of Open Finance at Mastercard Brazil, in a fireside chat to discuss challenges and the countless lessons learned from this ecosystem implementation in the country.

Thomas said: “The possibilities that Open Finance brings to the market are accompanied by several opportunities for institutions. Therefore, we have been working to demonstrate our experience in the matter in regions such as Europe, Asia and the USA, which makes us an important partner at this time, also to Brazil.”

The Campfire featured sessions in English and Portuguese. The discussion in Portuguese, which was chaired by Leandro Pupe Nóbrega, Product Operations Leader at Belvo, focused on the adoption of Payments Initiation in Brazil.

Ana Paula Nunes Cerchiari Almeida, Superintendent of Digital Cash Management & Open Banking at Itaú Unibanco, said: “We believe that payment initiation brings a great opportunity from the customer’s point of view. I believe that after this initial stage of stabilisation of Open Finance platforms, Brazil will see a significant increase in initiators bringing different solutions and benefits to meet the needs of our payers and recipients. I believe that we will have adoption both from institutions and users of these solutions.”

Janaína Pimenta Attie, Head of Division in the Financial System Regulation Department, Central Bank of Brazil (BCB), said: “The Open Banking implementation process here in Brazil, despite being very recent, has already presented very concrete and expressive results, especially if we consider its breadth of scope, number of participants and the resulting complexity.

“Payment initiation combines two of the Central Bank’s most strategic and significant projects: Open Finance and PIX.  We expect that this merger will bring very significant benefits, especially for the receiving users, shopkeepers, commerce and customers. The initiation explores a segment with very relevant growth potential. The usability improvements of paying with PIX via an initiator are an interesting differentiator for this experience in this environment.”

Luigi Iervolino, Director & Head of Open Finance CoE at BIP Brasil, said: “Institutions are preparing to literally transform the customer journey by including these new possibilities that payment initiation allows, simplifying onboarding and payment transfer.”

In the English section of the Campfire, pioneers from the UK were asked to share their learnings on Open Banking and Finance implementation.

Gavin Littlejohn, Chairman of FDATA, said: “In Brazil, it is critical that customer experience guidelines are implemented and that the regulatory authorities pursue a standardisation approach. It is possible to innovate beyond that but having a high-quality minimum threshold is a great place to start.”

He also suggested how to drive adoption: “As an industry, we need to provide regulatory authorities with better tools to ensure that companies are compliant with the minimum market requirements. Besides that, we need to start aligning commercial incentives and begin the process of enabling functionalities beyond the minimum requirements.”

Huw Davies, Co-founder and Chief Commercial Officer of Ozone API, shared some learnings for Brazil taken from his time leading the development of the Open Banking ecosystem in the UK: “We have had some good momentum in the UK recently, particularly around the uptake of payments.

He added: “Brazil had a massive second mover advantage and could build on the learnings of the UK with mandated standards and strong conformance regimes. It has created a foundation for a high-performing ecosystem.”

Ralph Bragg, Founder & CTO of Raidiam, said: “The real evolution takes place when banks and providers look beyond the regulatory mandate and at what is being implemented.”

He added: “Brazil has capitalised on the learnings from the UK and other markets to deliver quickly, plug quite a few of the gaps and fix quite a few of the mistakes we made the first time around.”

“Brazil has a chance to learn, take stock and implement quickly by cherry-picking the best of what is available around the world.”

 

About OBE

OBE is a global centre of community and knowledge driving change in Open Finance. We create exceptional platforms and content that promote new thinking, partnerships and ways of working for financial service providers, banks, fintechs, regulators and the wider ecosystem – catalysing the adoption of Open Finance and Data for better financial inclusion worldwide. Our collaboration and conversations continually keep the Open Banking industry connected and supported, driving them toward growth and innovation.

  

About OBE Brazil

OBE Brazil is a local chapter of Open Banking Excellence (OBE), the global community based in the UK, created to inspire innovation, collaboration and partnerships within Open Finance. It’s born at a very exciting time for Open Banking within the country, and is designed to spark connections and knowledge that shape the future of Open Finance within Brazil – whilst also connecting the Brazilian industry to a wider global family and amplifying its successes. This is an opportunity for pioneers in the UK Open Finance space to also share their lessons learned as well as use cases that are already changing consumers’ lives for the better. Sponsored by Mastercard and Accenture, OBE Brazil is a big family that fuels collaboration, ideas and knowledge sharing between peers, countries and continents through its campfires, hackathons, masterclasses and events.

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The Best Accounting and Auditing Firm – South America

Two accountants discussing an audit

Recognized as South America’s Best Accounting and Auditing Firm, Abalt Accounting, Audit & Tax specializing in providing professional services in the financial, accounting, administrative, tax and legal sectors. Established by a team of interdisciplinary professionals, Abalt is run under the highest industry standards, providing the utmost ethical and confidential levels of quality to its diverse range of clients – unparalleled in its field of expertise.

Founded in 2008, Abalt Accounting, Audit & Tax provides comprehensive solutions with high added value that allow its clients to produce competitive improvements to keep up with the continual fluctuations of the modern world.

Accredited for being independent professionals in their retrospective sector, Abalt transforms its client’s investments into exceptional results, offering the nation integral solutions through its three sectors of business – accounting, auditing and taxes.

At Abalt, clients can reside safely and comfortably, knowing that the company’s team of industry professionals, who are highly motivated, committed and exceptionally capable of exceeding excellence, will look after their investments. So, while Abalt is taking care of its client, clients can focus on what’s truly important – building their business.

Abalt has established a mission since its inception to provide permanent accompaniment throughout its services, ensuring that a member of staff is always accounted for its client’s journey with the company. As a result, clients are well cared for and catered to by delivering this added value, professionally and personally.

Abalt relies heavily on the professional intellectuals and talented individuals who work for the firm to provide such exceptional services. Staff members play an integral and fundamental role in the growth and success of the company due to the reputation that they produce and the results they achieve. Thus, when looking for young and eager professionals to join the team, Abalt focuses on the communal growth individuals can provide- to the company, in their roles and the client.

With over a decade’s worth of experience and expertise in the industry, Abalt has been able to provide exceptional services within its field and, because of its growing reputation, has expanded to several countries, aiding and supporting a diversified range of clients worldwide.

Abalt is recognized for its customer-orientated approach within accounting, auditing and tax sectors and is accredited within South America and internationally for providing comprehensive and effective solutions for businesses across the globe – a leading benchmark for auditing and consulting within the industry.

 

For business inquiries, contact [email protected] at  ABALT CIA. LTDA. or via www.abaltecuador.com.

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Safety First!

Manuifacturing machines in a factory

The history of safety is one built on increasing standards for everyone. The team at Automa Safety have revolutionized the industry for people in Brazil, bringing higher standards for all. In the Latin and South America Business Awards 2021, the team were awarded the title of Best Machine & Equipment Security Solutions Provider – Brazil. We dig a little deeper to discover precisely how they’ve achieved such success.

In 2003, the team behind Automa Safety began the process of reinventing the way in which Brazilian business sees safety. For nearly 20 years, the team have been encouraging and empowering organizations to make proactive steps to secure the safety of their equipment, their staff and their customers. With a comprehensive range of services covering a host of different industries, it’s little wonder that they are not only in such high demand, but have achieved such incredible success.

When the team first opened the firm’s doors, the hope was that Automa Safety could become a national reference in the machine security market. Their efforts have been targeted at all times to eliminating any risk of accidents within the workplace, making companies aware of their responsibilities towards the implementation of a safe working environment. It’s environments where people feel safe that are able to grow in a way that is responsible and reliable.

Key to the team’s success, therefore, is an approach which champions quality above all else. For them, the most important thing is making sure that their client’s staff are always safe. Nothing can be allowed to compromise their physical or moral integrity. Whilst emergencies may occur, there’s no reason why sound health and safety protocols cannot ensure that people are safe no matter what.

To take care of people, they must have access to the highest quality of machinery. For the last 18 years, the team have been developing leading solutions in numerous industrial sectors to ensure that their clients maintain the highest possible standards. The vast majority of companies do not reach Brazilian Regulatory Norms, which is why approval from Automa Safety is not only a sign of quality, but a seal of approval when it comes to safety. Their work has provided several solutions such as risk assessments, machinery inventories and training to ensure people feel safe.

Since opening their doors, the Automa Safety team have grown into the largest organization serving the machine safety market. Their metallurgical factory is filled with state-of-the-art equipment to support the highly trained team. The incredible quality of the team’s work is why so many trust them to deliver such a high level of success.

Of course, it’s not just people that the team are concerned with. Automa Safety has made its name through considering the challenges facing the local environment too. Their Environmental Management System allows them to consistently measure and control environmental performance in order to prevent sudden environmental impacts. The team are constantly searching for technologies that will keep them competitive, both in terms of cost and environmental impact.

 The world must become a safer place, and key to that is companies such as Automa Safety raising standards across the board. The work of this talented team is crucial to creating environments where all can feel comfortable. It’s a credit to the team’s hard work and tremendous ability that they have achieved so much for the people of Brazil, and are certain to do so long into the future.

 

For business enquiries, contact Vladimir Kuse at Automa Safety via [email protected].

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Best Internet Traffic Exchange Point 2021

A row of servers

Located in Santiago, PIT Chile is part of the Wired and Wireless Telecommunications Carriers Industry and has a total of 10 employees across all of its locations. We find out more about what the company can offer in the wake of it being recognized in the New World Report.

Established in 2016, PIT Chile is a large Internet Exchange Point (IXP), with seven data centers in the northern and central parts of Chile, connecting traffic between internet infrastructure companies. The company provides services to major content delivery networks (CDNs) including Facebook, Fastly, Google and Microsoft, and local Chilean ISPs businesses.

By definition PIT Chile is a public, neutral, transparent and open IXP. Other main characteristics of its exchange point include:

  • Distributed (presence in two datacentre: Ufinet in Las Condes (TIER II) and Level 3 in Huechuraba (TIER III)
  • Operation in Layer 2
  • Offers multilateral IPv4 and IPv6 peering
  • Allows bilateral peering
  • Home of a Root DNS server J, operated by Verisign
  • Home of a TLD server (Top Level Domain) DNS operated by Packet Clearing House
  • Has ASN and IP v4 and IP v6 own assigned by LACNIC for the exclusive use of the IXP
  • Is an IXP recognized by SUBTEL and LACNIC as such, in addition to other key institutions in the global internet such as ISC.org, PCH, PeeringDB or Verisign
  • Has a 24X7 operating NOC for the resolution of any contingency

PIT Chile’s strategy is continuous growth incorporating the largest number of members, whether they are PIT’s, ISP’s, CDN’s or other institutions such as universities, state agencies, or financial institutions, that meet the technical requirements.

The firm’s main objectives are to ‘put a switch away’ from Internet content providers and consumers, promote and facilitate bilateral peering between different networks, especially ISPs and content providers, promote and facilitate the use of IP v6, and reduce latencies in regional and national connections. It also increases available bandwidth and internet redundancy in America in general and Chile in particular. As a side effect, it achieves a reduction in costs so that it can be the Exchange Point with the largest number of members in America. It has the highest volume of traffic among the PITs in the world, advertises to members as many unique routes as possible (not advertised by other PITs/ISPs), and keeps as much internet traffic as possible within the PIT. Lastly, it promotes “peering” as a means to improve the internet and creates an active community where those responsible for networking, interconnections, routing, etc. participate and can exchange knowledge and help each other.

Recently, PIT Chile was named the prestigious accolade of Best Internet Traffic Exchange Point 2021 in the New World Report. This title is a testament to the dedication and continued hard work of the company.

 

For business inquiries, contact Pit Chile via www.pitchile.cl.

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Ministers and High-level Authorities Urge for Incorporating the Gender Perspective into Policies for Pandemic Response and Recovery

Illistration of people and medical equipment on a turquiose background

The 62nd Meeting of the Presiding Officers of the Regional Conference on Women in Latin America and the Caribbean, organized by ECLAC in coordination with UN Women, concluded 27th January 2022 with a call for promoting policies that would foster a transformative recovery with gender equality.

Ministers and high-level authorities from mechanisms for women’s advancement urged for incorporating the gender perspective into COVID-19 pandemic response and recovery policies and for including women and girls in their design and implementation, during the closing session of the Sixty-second Meeting of the Presiding Officers of the Regional Conference on Women, organized by the Economic Commission for Latin America and the Caribbean (ECLAC) in coordination with the United Nations Entity for Gender Equality and the Empowerment of Women (UN Women).

At the gathering, these authorities committed to “advancing recovery plans with affirmative actions that foster comprehensive care systems, decent work and the full and effective participation of women in strategic sectors of the economy for a transformative recovery with gender equality aimed at the sustainability of life and for the transition to a care society.”

In the agreements reached at the meeting, the delegates again reaffirmed the commitment to “take all necessary measures to accelerate the effective implementation of the Beijing Declaration and Platform for Action and the Regional Gender Agenda, strengthening gender equality institutions and architecture through the prioritization of machineries for the advancement of women and gender mainstreaming by the different levels and branches of the State, by increasing the allocation of financial, technical and human resources, gender budgeting, and monitoring and accountability, with citizen participation.” They added that this “will foster public policies for response to the COVID-19 pandemic and a transformative and gender-equal post-pandemic recovery.”

The authorities also approved a roadmap for the fifteenth session of the Regional Conference on Women in Latin America and the Caribbean, which will take place in Argentina during the first week of November 2022.

In the framework of the Regional Consultation prior to the 66th session of the Commission on the Status of Women (CSW), the ministers and high-level authorities adopted a joint declaration addressing climate change and disasters, environmental sustainability and gender equality. The Declaration recognizes the differentiated effects of climate change on women and girls, along with the greater impact they face when disasters hit, highlighting the region’s vulnerable situation with regard to both climate change and disasters. In this context, the adopted Declaration proposes concrete measures so that the climate and environmental challenge we are facing does not serve to further deepen inequality for women and girls, but rather serves as an opportunity to carry forward initiatives that would put them at the center. The Declaration will be presented by Argentina, the country that represents the Group of Latin American and Caribbean States (GRULAC) on the Bureau of the CSW, and to the rest of the countries that will participate in the 66th session.

Participating in the meeting’s closing session were Ana Güezmes García, Director of ECLAC’s Division for Gender Affairs, speaking on behalf of Alicia Bárcena, the regional commission’s Executive Secretary; María-Noel Vaeza, Regional Director for the Americas and the Caribbean of UN Women; and Mónica Zalaquett, Minister of Women’s Affairs and Gender Equity of Chile, in her capacity as Chair of the Presiding Officers of the Regional Conference on Women in Latin America and the Caribbean.

Ana Güezmes reaffirmed the importance of moving towards a care society for a transformative and sustainable recovery with gender equality in Latin America and the Caribbean.

ECLAC’s representative underscored that addressing climate change and disasters is one of the major challenges we face as a regional and international community, and it brooks no delays. “That is why we need to foster mitigation and adaptation actions, ones that are coordinated at an international, regional, national and subnational level. These actions are clearly linked to policies that would put care for the planet and for people at the center of sustainable development, and that means linking to, and removing, the structural constraints of inequality.”

Furthermore, Ana Güezmes emphasized that “it is urgently necessary to redistribute time, resources and power, and work to move towards a new development pattern based on gender equality and sustainability. We are facing a change of era. The care society is our horizon.”

In her remarks, María-Noel Vaeza stressed that “women’s organizations on the ground, and in particular those of women who defend human rights and the environment, including indigenous women, are especially vulnerable to growing threats and acts of gender violence, above all in Latin America and the Caribbean, since they are trying to protect natural resources from unsustainable exploitation. Ensuring their protection and their human rights must be an essential priority.”

Minister Mónica Zalaquett, meanwhile, highlighted Latin American and Caribbean countries’ commitment to continue laying the foundations for a more sustainable, inclusive and equitable post-COVID-19 world.

“I have watched with pride how our countries have risen to the occasion to face such a complex and changing scenario as the one prompted by the COVID-19 pandemic, which has affected all spheres of women’s lives, producing the biggest economic crisis in recent decades and further straining the gender inequalities and gaps that limit women’s autonomy in our society,” the minister stated. She also expressed gratitude for the broad support given to the Regional Alliance for Women’s Digitalization in Latin America and the Caribbean, led by Chile with technical support from ECLAC and UN Women, and reiterated her call for governments to actively participate in this initiative.

At the meeting, the participating authorities invited all the countries of the region to join the Global Alliance for Care, launched by Mexico with the support of UN Women, and encouraged the governments of Latin America and the Caribbean and of other regions, developed countries, United Nations agencies, funds and programs and other relevant actors to contribute financial resources to ensure the sustainability of the Regional Fund in support of Women’s and Feminist Organizations and Movements.

Finally, the ministers and senior authorities recognized Alicia Bárcena, ECLAC’s Executive Secretary, “for her leadership, commitment and outstanding work, and for her efforts in favor of the rights and autonomy of women in Latin America and the Caribbean, as well as for her tireless efforts in favor of gender equality to achieve sustainable development and a care society in the region.”

Participating in the meeting were delegates from 39 of ECLAC’s Member States and associate members, along with a sizeable group of representatives from UN agencies, funds and programs, specialized organizations and intergovernmental bodies, feminist and women’s organizations and civil society entities.

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Women’s Autonomy, Gender Equality and the Building of a Care Society are a Precondition, Path and Catalyst for Sustainable Development

Gender Inequality

Ministers of Women’s Affairs and authorities from mechanisms for women’s advancement in Latin America and the Caribbean inaugurated today the 62nd Meeting of the Presiding Officers of the Regional Conference on Women, organized by ECLAC in coordination with UN Women.

 

Women’s autonomy, gender equality and the building of a care society are a precondition, path and catalyst for sustainable development, according to the Ministers of Women’s Affairs and authorities from mechanisms for women’s advancement in Latin America and the Caribbean who participated today in the inauguration of the Sixty-second Meeting of the Presiding Officers of the Regional Conference on Women, which was held virtually on Thursday, January 27.

The meeting – attended as well by delegates from the region’s countries, members of international organizations, academia, women’s and feminist organizations, civil society and trade unions, among others – is being organized by the Economic Commission for Latin America and the Caribbean (ECLAC), which serves as the Secretariat of the Conference, in coordination with the United Nations Entity for Gender Equality and the Empowerment of Women (UN Women).

Speaking at the opening session were Alicia Bárcena, Executive Secretary of ECLAC; María-Noel Vaeza, Regional Director for the Americas and the Caribbean of UN Women; and Mónica Zalaquett, Minister of Women’s Affairs and Gender Equity of Chile, in her capacity as Chair of the Presiding Officers of the Regional Conference on Women in Latin America and the Caribbean.

The gathering featured the participation of Sima Bahous, the new Executive Director of UN Women who, along with Alicia Bárcena and María-Noel Vaeza, launched the Special Session of Regional Consultation prior to the 66th session of the Commission on the Status of Women (CSW).

“The recovery will be feminist, or it will not be at all,” Alicia Bárcena, ECLAC’s Executive Secretary, remarked in her opening speech. Reflecting on her years at the helm of ECLAC, she reviewed the contributions to substantive equality in the region and to the regional gender agenda that were made under her leadership.

In that regard, she recalled that ECLAC has contributed to establishing women’s autonomy as an issue in the region, to analyzing and linking gender inequality to the lack of women’s autonomy, and to producing evidence on women’s physical, economic and decision-making autonomy, their interrelationships, and their manifestations in the structural constraints of inequality.

Separately, she said that women have been on the front lines of the response to the COVID-19 pandemic and that the importance of care and equality for the sustainability of life has never been clearer.

She emphasized that in the face of a development model that is associated with the concentration of wealth, environmental deterioration, the climate crisis and care crisis, the increasing precariousness of women’s living conditions and societies marked by patriarchy, racism, violence, inequality and the culture of privilege, “we cannot go back to a normality that produced huge inequalities, poverty and suffering.”

For that reason, “we need an urgent shift in the development model to move towards a care society that recognizes the interdependence of people and the environment; the interdependence between productive processes and society; and that puts the sustainability of human life and the planet at the center,” Alicia Bárcena affirmed.

She warned that the pandemic has widened gaps and disproportionately harmed women, who are concentrated in the sectors most affected by job losses. But the discouraging data is not confined to the realm of economic autonomy, the Executive Secretary stated.

“We must shine a light on the pandemic in the shadows. Femicide and other gender-based violence continue to affect women and girls in the region. According to ECLAC’s Gender Equality Observatory, at least 4,091 women were victims of femicide in 26 of the region’s countries in 2020, and one out of every four girls and adolescents in Latin America and the Caribbean contracted marriage for the first time or maintained a live-in relationship before the age of 18; this is a harmful practice and a human rights violation that has not changed in the last 25 years,” she declared.

In her remarks, the senior United Nations official highlighted that in the last decade, ECLAC has accompanied Latin American and Caribbean governments in their work to address conceptual and public policy challenges to promote sustainable development based on gender equality and women’s rights and autonomy.

She noted that the Montevideo Strategy for Implementation of the Regional Gender Agenda within the Sustainable Development Framework by 2030 constitutes a contribution by the region to putting gender equality and women’s autonomy at the center of the debate on sustainable development. The Santiago Commitment, meanwhile, takes a forward-looking view, with agreements in areas that had not been addressed before in the Regional Gender Agenda and that are key for responding to emerging challenges for women amid changing economic, demographic, climate and technological scenarios.

Finally, Alicia Bárcena pointed up the strength, courage, capabilities and creativity of women in Latin America and the Caribbean and their organizations, and she reaffirmed ECLAC’s commitment to continue championing policies and partnerships that would allow for protecting the progress made on guaranteeing women’s rights in the last decade, preventing setbacks and promoting a transformative recovery with gender equality, which is based on the feminist principles of redistribution of power, resources, work and time.

“The goal must be to move towards the forging of fair and egalitarian development patterns. We see the care society as a civilizational leap forward, as the most promising horizon for a transformative and sustainable recovery with gender equality,” she added.

“Together we can do more and better for a sustainable, inclusive and resilient recovery. I will say it again: the post-pandemic recovery in Latin America and the Caribbean will be feminist, or it will not be at all,” she concluded.

In her remarks, María-Noel Vaeza stressed the urgency of better incorporating women into the socioeconomic recovery, with strengthened systems for comprehensive care and with universalized access to technology.

“These elements will allow for building more just and egalitarian societies, with better conditions for addressing present and future challenges. I believe it is critical to emphasize that the creation of comprehensive care systems can become a true motor of the region’s socioeconomic recovery, leaving no one behind,” she stated.

Minister Mónica Zalaquett, meanwhile, indicated that the pandemic has exposed the fragility of the hard-won achievements made on gender equality.

“Today it is imperative to work so that the post-COVID-19 world can be structurally less unequal. This crisis has given us a unique opportunity to implement actions that would allow us to reduce gender gaps and move steadily towards sustainable development. We must act urgently to restructure care systems,” she said.

At the 62nd Meeting of the Presiding Officers, authorities will exchange opinions and positions on preparations for the fifteenth session of the Regional Conference on Women in Latin America and the Caribbean, which will take place later this year in Argentina and will have as its central theme, “The care society: a horizon for sustainable recovery with gender equality.”

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Latin America and the Caribbean: Time for Reforms to Address Long-Standing Challenges, Says New Report

Reforms

The Development Centre of the OECD, ECLAC, CAF and the European Commission launch today their joint report Latin American Economic Outlook (LEO) 2021.

Latin American and the Caribbean (LAC) is the region most affected by the COVID-19 pandemic, and at risk of seeing the socio-economic gains of recent decades being reversed. Recovery strategies must comprise well-sequenced reforms that promote universal social protection systems, accelerate the formalisation of economies, improve fiscal progressivity, and deepen regional integration, says the Latin American Economic Outlook (LEO) 2021: Working Together for a Better Recovery.

According to this 14th edition of the report, LAC experienced a historical economic downturn in 2020. The region’s gross domestic product (GDP) contracted by around 7.0%. Despite a rebound of around 6.0% in 2021, its GDP per capita is not expected to return to pre‑crisis levels before 2023‑24. The impact of the crisis has been asymmetric, particularly affecting the most vulnerable groups. As a result, poverty and extreme poverty levels are at their highest in 20 and 12 years, respectively.

While the report recognises the considerable efforts made to protect most vulnerable, including women, the youth and elderly during the pandemic, it also stresses that close to 40% of workers had no social protection when LAC countries entered the crisis. This is largely because, on average, more than 50% of workers in the region work informally. Advancing towards universal social protection systems is fundamental to protect those most in need in the post-pandemic context.

According to LEO, a robust and inclusive recovery requires more productive integration in strategic sectors including the automotive, pharmaceutical and renewable energy sectors, the circular economy and sustainable agriculture. It also demands an urgent holistic fiscal response: greater progressivity of the taxation system, higher tax compliance, stronger tax administration, and eliminating inefficient tax expenditures. Reducing tax evasion and avoidance or eliminating some tax expenditures that represent close to 4% of GDP could increase revenues and equity without compromising the economic recovery.

LEO 2021 highlights that only 38% of citizens trusted their governments in 2020, down from 45% in 2010. Social discontent remains a key concern, as seen in the protests in some countries of the region. Moreover, satisfaction with public services, including education and health, markedly decreased during the pandemic. For education, it decreased from 66% in 2019 to 53% in 2020. As a response, the report explores policy actions to rethink the social contract in the region, suggesting four principles to guide a process of consensus building: conciliate, contextualise, compensate, and communicate.

The publication also stresses the role of international cooperation in facilitating the emergence of such new development models and a new social contract in the region. National responses to both the sanitary and socio economic consequences of the crisis need to be accompanied by renewed partnerships for the recovery that place sustainability, resilience and well-being at their core. The design of debt treatment paying attention to each country’s characteristics, in particular the challenges faced by Small Island Developing States of the Caribbean countries, is essential for a successful recovery.

The LEO is jointly produced by the Development Centre of the Organisation for Economic Co-operation and Development (OECD), the United Nations Economic Commission for Latin America and the Caribbean (UN-ECLAC), CAF’s Development Bank of Latin America and the European Commission.

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The High Prevalence of Non-Communicable Diseases in the Caribbean is Exacerbating the Pandemic’s Impact and Hindering the Subregion’s Progress Towards Sustainable Development

Disease

Alicia Bárcena, Executive Secretary of ECLAC, and Camillo Gonsalves, Minister of Finance, Economic Planning and Information Technology of Saint Vincent and the Grenadines, led a seminar on this issue prior to the 20th meeting of the Monitoring Committee of the Caribbean Development and Cooperation Committee.

The high prevalence of non-communicable diseases in the Caribbean – such as high blood pressure, diabetes and cancer – is exacerbating the impact of the COVID-19 pandemic and hindering the subregion’s progress towards achieving sustainable development due to their multiple health, economic and social consequences, according to the authorities, representatives of international organizations and specialists participating in a virtual event organized by the Economic Commission for Latin America and the Caribbean (ECLAC) prior to the Twentieth meeting of the Monitoring Committee of the Caribbean Development and Cooperation Committee (CDCC), to be held today.

The Seminar on non-communicable diseases and their impact on sustainable development in the Caribbean was inaugurated by Alicia Bárcena, Executive Secretary of ECLAC, and Camillo Gonsalves, Minister of Finance, Economic Planning and Information Technology of Saint Vincent and the Grenadines. The moderator was Diane Quarless, Director of ECLAC’s Subregional Headquarters for the Caribbean, located in Port-of-Spain.

“Not only does the COVID-19 pandemic continue to rage in the Caribbean,” Alicia Bárcena affirmed upon emphasizing that it is “one of the subregions of the world with the highest prevalence of non-communicable diseases (NCDs).”

Data from the World Health Organization (WHO) shows that NCDs are the main cause of death in the subregion’s countries, ranging from 57% in Haiti to 83% in Barbados, she stated. In each Caribbean country, more than half of all deaths annually can be attributed to non-communicable diseases, which also contribute significantly to disability, ECLAC’s Executive Secretary warned.

The pandemic has aggravated the risks that people with non-communicable diseases face: not only do they continue to be at greater risk of dying or suffering severe illness from COVID-19 infection, they also have been affected by interruptions in health care due to services being overburdened, Bárcena explained.

In this context, the high-level United Nations representative called for accelerating vaccination efforts. The rate of full vaccination in the Caribbean amounts to 35.2%, with great heterogeneity between countries. This percentage, she indicated, is below the global rate (39.0%) and that of Latin America (47.5%).

“The entire region of Latin America and the Caribbean should strengthen production, distribution and access to medicines and vaccines. To achieve this, on September 18, ECLAC presented the Plan for self-sufficiency in health matters requested by the Community of Latin American and Caribbean States (CELAC). We are moving from design to implementation of the plan, with focal points in all the countries and various meetings planned for the coming months. We hope the Caribbean will join us,” Bárcena stated.

In his remarks, Minister Camillo Gonsalves of Saint Vincent and the Grenadines expressed appreciation for the opportunity to address the problem of non-communicable diseases at a time when all Caribbean countries are fighting the pandemic and many of their ministers and leaders are talking about climate change and the subregion’s future in the framework of the 26th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP 26).

“Non-communicable diseases are responsible for 6 of the 10 main causes of death in the subregion” and they entail a heavy economic cost for governments, due to high health expenditures, as well as for people, Minister Gonsalves said. NCDs have a disproportionate impact on people living in poverty, which means that addressing them constitutes a development challenge for the Caribbean, which is also true for other phenomena such as climate change, he noted.

“Non-communicable diseases are within our control, they are preventable,” the Minister acknowledged, affirming that current policies are not effective because they are not sufficiently focused on prevention, nor do they include cross-sector and coordinated approaches.

The seminar’s first panel featured remarks by Kenneth George, Chief Medical Officer of Barbados; Fitzroy Henry, Professor at the College of Health Sciences of the University of Technology of Jamaica; Kavita Singh, Senior Research Scientist at the Public Health Foundation of India; and Francis Morey, Deputy Director of Health Services of Belize; while Simon Anderson, Professor and Director of the George Alleyne Chronic Disease Research Center at The University of the West Indies, Cave Hill Campus Barbados, acted as moderator. Subsequently, Joy St. John, Executive Director of the Caribbean Public Health Agency, led a discussion.

Participating in the second and final panel were Anselm Hennis, Director of the Department of Noncommunicable Diseases and Mental Health at the Pan American Health Organization (PAHO/WHO); Rachel Nugent, Vice President of Global Noncommunicable Diseases at RTI International; Stanley Lalta, from the Centre for Health Economics of The University of the West Indies, St. Augustine Campus, Trinidad and Tobago; and Rosa Sandoval, Coordinator of the Economics of NCDs Team at PAHO. Acting as moderator was Abdullahi Abdulkadri, an official at ECLAC’s Subregional Headquarters for the Caribbean.

The specialists called on governments to invest in a comprehensive approach to NCDs, with a focus on strengthening primary care and preventing risk factors such as an unsuitable diet, physical inactivity and tobacco and alcohol abuse. They also urged for taking growing mental health problems into consideration.

At the close of the event, Alicia Bárcena summed up what had been discussed, delivering 10 messages. First, she said, COVID-19 was a wake-up call about the importance of addressing non-communicable diseases. Because care and treatment for NCDs were reduced during the pandemic, it is urgently necessary to support the efforts of health services with innovations in telemedicine and other solutions, she sustained. She also posed the need to utilize all available tools to foster healthy lifestyles, strengthen primary health care and community-based programs, and promote food security, nutrition-sensitive social protection and support for farmers.

Bárcena further contended that it is critical to achieve greater equity in access to essential medicines, reduced waiting times and reduced out-of-pocket payment burdens for people, while also expanding partnerships with academic institutions in the Caribbean and reinforcing inter-agency collaboration. The idea of using taxes on unhealthy products is also generating interest and should be carefully weighed using a sound socioeconomic analysis, she added.

To procure a resilient post-pandemic recovery, Caribbean countries need a healthy and productive workforce, the Commission’s Executive Secretary stressed. The GDP of the Caribbean dropped by 7.7% in 2020 as a result of the pandemic, compounding the high rates of indebtedness faced by the subregion’s countries. ECLAC estimates that in 2021, the Caribbean’s GDP will only grow by 4.1%.

“By taking an economic approach to the analysis of the NCD problem, we hope that policies aimed at promoting health and preventing disease will not only be cost-effective but that they may also be cost-saving, thereby making government health expenditures more effective,” Bárcena emphasized. This is a problem for society as a whole, which must be addressed beyond the health field. “Interventions on non-communicable diseases are within our reach. You can count on ECLAC.”

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Africa, Latin America and the Caribbean Join Forces to Drive Circularity

Zero waste concept art

Taking the first steps of collaboration among the regions, the respective countries are pursuing efforts to scale circularity through the promotion of conducive public policies and the creation of investment opportunities.

 

The practice of using discarded products are raw materials to be used as a new product or material, is in some respects more efficient than simply recycling. With this in mind, the African Circular Economy Alliance (ACEA), and the Circular Economy Coalition of Latin America and the Caribbean (CECLAC) have organized the first regional dialogue to strengthen cooperation around their common objectives.

 

The event titled “Regional deep-dive: Africa, Latin America & the Caribbean joining forces for circularity”, took place as part of the World Circular Economy Forum 2021, organized by Sitra and Environment & Climate Change Canada. The event, held on 15 September, was launched by the Ministers of Environment of Colombia and Rwanda, who underlined the role that the circular economy can play in driving a green recovery from the Covid-19 pandemic. Being key advocates in their respective regions, both countries are also part of the Global Alliance on Circular Economy and Resource Efficiency.

 

The high-level keynote speeches were followed by a panel discussion moderated by James Mwangi, Executive Director of Dalberg, which brought together key circular economy practitioners from Africa and Latin America.

 

Discussions were held among entrepreneurs, academics, and champions on the need to scale up the transition towards circular economies. “Circular economy is a key puzzle piece to reach the climate targets. It will be instrumental in driving the change in key sectors … Latin America and Africa can be frontrunners in this journey, where governments and industry work together,” said Gonzalo Muñoz, High-Level Climate Action Champion  COP25.

 

Wanjiru Waweru Waithaka, founder and CEO of FunKidz, added: “Circular economy is not a new concept to Africa. From our traditional building techniques to the way we stored water and food. We did not waste, nor depend on factory-produced items. We need to go back into our cultures and relearn how to live in and with nature.”

 

Panelist Kenneth Amaeshi, Chair of Business and Sustainable Development at the University of Edinburgh, and entrepreneurs from both regions, showcased concrete business models that SMEs are undertaking and implementation solutions to achieve a circular economy.

 

“I have no doubt that Africa’s youth will be a game changer for the circular economy,” said Anthony Nyong, Regional Director of the Global Center on Adaptation (GCA) Africa, closing the meeting. “Africa is the continent where most of its infrastructure needed is yet to be built. There is an opportunity to build climate-resilient systems that provide jobs for the youth.” He concluded by announcing the first edition of the African Youth Adaptation Solutions (YouthAdapt) Challenge call for applications launched by GCA and the African Development Bank.

 

The key takeaways of the event echoed the outcomes of the first High-level Meeting of the Global Alliance on Circular Economy & Resource Efficiency (GACERE) held the day before, during which Ministers of Environment of several countries and representatives from multilateral organizations emphasized the need for stronger regional cooperation to accelerate the adoption of the circular economy model worldwide. Representing the African Development Bank, the Acting Director for Climate Change and Green Growth, Al-Hamdou Dorsouma, stated that policies, financing and the upskilling of African youth and workers will be key enablers for the circular economy transition.

 

With its strong climate benefits, most notably the reduction of greenhouse gas emissions, the circular economy is likely to be on the agenda at COP26, which will be held in November in Glasgow.

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Amid the COVID-19 Crisis, Latin America and the Caribbean Received in 2020 the Lowest Amount of Foreign Direct Investment in a Decade

Covid crisis

In a new report, ECLAC calls on the region’s countries to channel FDI flows – which are expected to hold steady in 2021 – towards activities that generate greater productivity, innovation and technology.

In the context of the severe health, economic and social crisis prompted by the COVID-19 pandemic, Latin America and the Caribbean received $105.48 billion dollars in Foreign Direct Investment in 2020 – 34.7% less than in 2019, 51% less than the record high achieved in 2012, and the lowest amount since 2010, the Economic Commission for Latin America and the Caribbean (ECLAC) indicated today upon presenting its annual study Foreign Direct Investment in Latin America and the Caribbean 2021.

Globally, the amount of Foreign Direct Investment (FDI) dropped by 35% in 2020 to approximately $1 trillion dollars, which represents the lowest value since 2005. Latin America and the Caribbean has experienced a downward trend since 2013, which has spotlighted the relationship between FDI flows and commodity price cycles, mainly in South America, according to the report launched at a virtual press conference held by Alicia Bárcena, the United Nations regional organization’s Executive Secretary.

The international context suggests that global FDI flows will recover slowly. Furthermore, the pursuit of assets in sectors that are strategic for the international reactivation and for public plans to transform the productive structure (infrastructure, the health industry, the digital economy) indicates that most of these operations will be centered on Europe, North America and some countries in Asia, increasing global asymmetries, the study warns.

In Latin America and the Caribbean, FDI projects experienced a rebound between September 2020 and February 2021; however, from that month to May 2021, it appears that a new drop occurred in the value of the announcements made. “In this scenario, it is difficult to imagine that FDI inflows into the region could increase by more than 5% in 2021,” ECLAC’s report states.

“FDI has made relevant contributions in Latin America and the Caribbean, but there are no elements indicating that in the last decade it has contributed to significant changes in the region’s productive structure or that it has served as a catalyst for transforming the productive development model. Today, the challenge is greater due to the characteristics and magnitude of the crisis. We need to channel FDI towards activities that generate greater productivity, innovation and technology,” Alicia Bárcena sustained.

ECLAC, she said, has identified eight strategic sectors to drive a big push for sustainability in the region. These sectors – which could be bolstered by FDI – are the transition to renewable energy; sustainable electromobility in cities; an inclusive digital revolution; the health-care manufacturing industry; the bioeconomy; the care economy; the circular economy; and sustainable tourism.

The report indicates that FDI increased in just five of the region’s countries in 2020: the Bahamas and Barbados in the Caribbean; Ecuador and Paraguay in South America; and Mexico, which is the second-biggest recipient in the region after Brazil. The natural resources and manufacturing sectors, with declines of -47% and -38%, respectively, were the hardest hit in 2020. Renewable energy held steady as the sector in the region that sparks the most interest among foreign investors.

In 2020, the United States increased its participation in the region’s FDI from 27% to 37%, amid a sharp decline for Europe (which fell from 51% to 38%) and Latin America (which went from 10% to 6%). “The smaller decline of the United States as a source of FDI is due mainly to the increase in that country’s investments in Brazil in 2020. In contrast, the inflows from the two European countries that had the most investments in Brazil – the Netherlands and Luxembourg – fell between 2020 and 2019, which led to Europe having less weight as an investor,” the document states.

In 2020, the flows of Latin American transnational enterprises (known as translatinas) also plunged (-73%), although with sharp heterogeneity: while Chile and Mexico showed an increase in direct investment flows abroad, Argentina, Brazil, Colombia and Panama recorded setbacks.

“In addition to maintaining emergency aid for the most vulnerable sectors of the population and smaller companies, the region’s countries should set in motion strategic plans both for reactivation and the transformation of production. Governments and the private sector should use their capacities so that the policy for attracting foreign capital becomes part of industrial policy as an instrument for transforming the productive structure,” Bárcena emphasized.

The second chapter of the report, entitled “Chinese investment in a changing world: repercussions for the region,” poses that “Latin America and the Caribbean’s process for recovering from the COVID-19 pandemic is an opportunity to start a new phase in its economic relations with China and to develop policies to ensure that investments by that country contribute to building productive capacities in receiving countries, to establishing ties with local suppliers, to creating employment, and to promoting sustainable development. Multilateralism must be part of this strategic approach.”

Finally, the third chapter, entitled “Investment strategies in the digital age,” analyzes digital development in the world and the region through a conceptual model that includes three dimensions (connected economy, digital economy and digitized economy) and addresses numerous challenges related to inclusion, innovation, regulation and taxation, among others. FDI can contribute to the digital transformation in Latin America and the Caribbean, ECLAC affirms, but if the structural characteristics of the region’s economies are not taken into account, digitalization could widen existing gaps and produce greater exclusion and distributive inequality, it concludes.

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