Industry, Innovation and Infrastructure

As we prepare this edition of CEPAL Review, our editorial team wishes to express its deep sorrow upon the death of Oscar Altimir on 27 September in Santiago. His departure is deeply felt by the ECLAC community, especially by those of us involved in the production of CEPAL Review. We acknowledge the intellectual legacy of Altimir, who directed this publication between 1996 and 2008, succeeding its first two directors: Aníbal Pinto Santa Cruz (1986–1996) and founder Raúl Prebisch (1976–1986). This editorial is intended to convey our heartfelt homage to Altimir’s academic figure and distinguished career as a leading development economist in the region and as one of the most prominent thinkers of the Economic Commission for Latin America and the Caribbean (ECLAC) over the past 40 years.

In order to examine the decisive role played by transnational private banks in the Bolivian economy in recent years, the author considers the concept of external dependence. After analysing in his introduction the usual meanings of this concept as referred to external vulnerability and foreign participation in the economy, he concentrates on what he calls Voluntary dependence’, where such dependence is generated or increased due to the actual economic policy adopted by the State.

The great problems of the Latin American countries, which are manifested most clearly in the poverty, malnutrition, unemployment and underemployment of a considerable part of the population, have made it necessary to rethink the role of agriculture in the process of development.

The concept of integration dates back a long time, although it has been used as an economic term only since the Second World War, when it was used to explain one of the objectives of the programmes for the reconstruction of Europe. Since its distant origins, its meaning has changed according to circumstances, which justifies an exploration of its various meanings in order to give them a sense appropriate to the present circumstances.

The travelling conditions of all the city-dwellers of Latin America are made more difficult by high levels of congestion, but the lower-income strata are in a particularly negative position, since they are usually limited to the use of buses and thus have to spend a larger proportion of their time and money on travelling than the better-off sectors of the population.

This article gives a brief overview of the post-war international m onetary system and its main characteristics, w ith special em phasis on the aspects which subsequently created difficulties. It shows how the system developed and identifies the events which led to the international m onetary crisis at the beginning of the 1970s. It describes the exchange arrangem ents w hich arose as a consequence o f the crisis and analyses the conditions in which such arrangem ents can be effective, the developing countries’ possibilities of using them, and the effects on those countries and on the dem and for international liquidity by the public and private sectors. With regard to this latter aspect, it stresses the increase in the private sector’s intervention role in the exchange m arkets and the influence of this increase on the international generation and transm ission of disequilibria. It then goes on to the attem p ts to reform the m onetary system and the am endm ents to the Articles of Agreement of the International M onetary Fund and their effects on the developing countries.

Since 1973, the Latin American countries have had to adjust to a world economy and a world trade situation which are characterized by slow growth and instability in the central countries.

The form of development which particularly pre-dominates in the largest countries of the region has been repeatedly criticized in various CEPAL studies because of its tendency towards a concentrated distribution of income, the persistence of extreme poverty, incapacity to absorb the entire labour force in a productive manner, growing external vulnerability, and increasing loss of national capacity to manage the economy.

A large proportion of the Latin American countries have sought and are still seeking to incorporate into their development plans and the design of their economic policies elements whereby they seek to correct or minimize some of the most obvious internal disparities in growth rate, well-being and modernization between the various areas or regions which make up the nation.

Now, as 1983 begins, there are few remaining doubts about the gravity of the international economic situation. Not since the Great Depression of the 1930s has the world known such a serious and prolonged crisis. Almost no society has managed to escape its pernicious effects, for the problems suffered by the countries of the developed North and the developing South, those of the socialist East and the West are all similar. The fact that this crisis affects all societies, whatever their ideological orientation, political system or economic model, is the best demonstration that we are in the presence of a universal phenomenon involving all nations.

In recent years, increasing attention has been paid to the changes that have been taking place in the rural environment, particularly those relating to the peasantry of Latin America.

For a number of years CEPAL has conducted an inter-agency project financed by UNDP and UNICEF on critical poverty in Latin America, in which systematic consideration is given to the characteristics of poverty and policies for overcoming it are suggested.

Full understanding of the nature of the present crisis calls for an interpretation which is at once broad enough to cover both the centres and the periphery and deep enough to penetrate beyond the superficial manifestations of the problem to the very heart of its causes.

In the postwar period, as is known, Latin America underwent a process of demographic growth and urbanization unprecedented in its history.

The present article is structured around several basic ideas. In the first place, attention is drawn to the twofold character of Latin American unity, with reference to the close interdependence between regional ‘inward-directed’ co-operation policies which foster development and ‘outward-directed’ concerted measures which reduce the region’s external vulnerability.

Hitherto Latin America’s adjustments to debt servicing requirements have taken the form of a contraction of imports and of the economy as a whole, which is producing perverse effects not only in the economic but also in the social and political spheres.

Although there is a consensus to the effect that the problem of school failure still loms so large in Latin America that it casts a shadow on the successes achieved through the ever-increasing coverage of the educational system, its causes are the subject of ardent theoretical and empirical controversy.

The dynamism shown by Latin American exports as from 1975 led to the expectation that, if such a growth rate could be maintained, the region would eventually recover to some extent the share it had enjoyed in world trade during the 1950s.

This article focuses on the structure of the production system and on policies for improving it, with particular reference to medium-sized and small enterprises. Information and specific examples are provided based on Italy’s experience in this respect and on the role which such enterprises have played in that country. It is suggested that, from this standpoint, Italy’s experience may be of much greater interest to many developing nations than that of other industrialized countries, both as a model to be followed and in terms of the errors that should be avoided.

In recent years there has been much discussion of the effect on manufacturing industry produced by the recent application of global monetarist policies. In the present article it is asserted that they have introduced an anti-industrial bias which has diminished the importance of the sector and, in some cases, has even destroyed a large part of its installed capacity.

On the basis of statistical information partly obtained from secondary sources —especially PREALC and the World Bank— and partly collected in personal research made in some Latin American countries, the author describes and interprets the evolution of underemployment in the region during the period 1950-1980.

The monetary, financial and trade imbalances which have caused or aggravated the present crisis are being tackled in most of the Latin American countries through conventional adjustment policies.

The stalements made by the Executive Secretary at the ECLAC sessions are among the fullest expressions of the institution’s thought. The present article reproduces the address delivered at the Third Plenary Meeting of the Twentieth Session (April 1984), the aim being to present an overview of the present economic situation of Latin America.

The situation and prospects of young people have changed a great deal in Argentina in recent decades because economic growth has been meagre, political problems have become more acute and social mobility has decreased. Against this background, the author examines different factors in the reality of youth in Argentina, such as demographic evolution, regional inequalities, the special conditions of young women, the rote of the family in the socialization of young people, the positive and negative effects of educational expansion and participation in the world of work.

The crisis in Latin America has a sui generis character, the elucidation of which has impelled the author to venture into virtually unexplored fields of in terdisciplinary analysis and to make generalizations covering a variety of national situations. Within this framework, he asserts that many of the central problems which look like conjunctural distortions—shortages of foreign exchange, deficits in public finance—in reality stem from imperfect structural adjustments both in the international economy and within the Latin American countries, the treatment and cure of which will be much more than a short-term matter.