CEPAL Review - Volume 1993, Issue 51, 1993

Today, we are celebrating three important events at the same time. The first of these is that issue No. 50 of CEPAL Review has just come out, thus marking 19 years of uninterrupted publication. We are justly proud of the high level attained by this Review, which firs tappeared under the direction of Raúl Prebisch and later continued under the leadership of Aníbal Pinto, ably seconded first of all by Adolfo Gurrieri and now by Eugenio Lahera. I should like to express my thanks to all of them and to say how pleased I am that the Review is now considered one of the most serious technical publications in the field of Latin American and Caribbean development.

The constitution of a new international industrial order dominated by a core of large transnational corporations generally makes life more difficult for the great majority of developing countries because, since most are not in a position to compete effectively, they face still greater marginalization.

It is paradoxical that during the 1980s, when industrial policy tended to fade as a subject for academic scrutiny and was relegated to the sidelines by decision-makers in most of the Latin American countries, it continued to form the basis for the implementation of important measures and instruments in developed and newly industrializing countries and regions.

Latin American manufacturing industry has undergone various changes in recent years. It has registered a favourable performance as far as exports are concerned, but production and investment have grown only slowly in a context of sluggish recovery of domestic demand and greater foreign competition. Other features are greater specialization in natural resource-based intermediate goods characterized by the importance of economies of scale, relatively long lead times for the heavy investments required, and the presence of privatized and transnational enterprises.

The various sectors of rural society have seen sweeping changes during the second half of the twentieth century. These changes have included agrarian reforms (and counter-reforms); the modernization of technology and society; demographic pressure; an increase in temporary work at the expense of permanent employment; migrations; the replacement of authoritarian regimes by democracies (and vice versa); decentralization processes; greater access to mass media, and stronger influence by such media.

Many indigenous leaders and intellectuals in the region are asking them selves how the current rapid spread of free market principles and the process of integration into a single world economy is likely to a ffect their cultures. The answer depends on what we mean by “culture” and what we mean by “modernity".

An attempt is made in this article to gauge the effect on productivity of women’s move out of the home and into gainful employment in the United States during the period 1960-1980, It questions the validity of the frequently-made assertion that women’s growing participation in the labour force has lowered productivity.

The large capital inflows into some Latin American countries since 1990 are a mixed blessing, for they widen the trade-off between disinflation at home and competitiveness abroad. A large part of the flows seems to be temporary rather than permanent. Permanent flows should be accommodated by an upward float o f the currency, temporary flows by sterilized intervention on the foreign exchange market. Recent evidence suggests that sterilized intervention is more effective and carries lower fiscal costs than is often maintained. Asian policy practice suggests ways of sterilized intervention even with underdeveloped securities markets.

Latin American development strategies have historically been inextricably linked with trade theory and policy. The author’s main argument is that the old infant industry and the new strategic trade arguments are fundamentally similar. Among their similarities is the justification of selective protection of certain economic sectors. Among their differences, the infant industry argument justifies temporary protection, while the argument in favour of strategic protection of certain industries justifies their protection on an indefinite basis.

Regional integration has once again become an important issue for Latin America and the Caribbean. Compared with previous experiences, however, recent integration commitments have a number of new aspects in such areas as negotiating procedures, the issues involved in the various agreements -some of which are as unprecedented as the adoption of common currencies, the creation of binational companies, common labour laws, etc.- and the actual timing of these steps.

Difficult as it is to forecast the magnitude of the impact of the Single European Market (SEM) on the rest of the world and on the European Community (EC) itself, the predominant feeling is one of concern, especially in the developing countries. This article seeks to determine how the completion of the SEM may affect Latin America’s exports to the Community, using basically a short- and medium-term analytical approach. This is because a series of elements make it possible to predict with some confidence that the deepening of Community integration will take more time than originally foreseen.

This essay identifies the main points in the natural resources debate. After highlighting the issues of sovereignty, distribution of benefits, deterioration in the terms of trade, and the institutional structure of world markets, which have been particularly important over the last forty years, it suggests that the debate should now get away from demands and counter-claims and concentrate instead on questions of sustainability and competitiveness. In conclusion, it proposes a regional initiative to strengthen the capacity to manage the natural heritage and resources and promote the wider spread and incorporation of technical progress.