Can Latin America Escape its Interlocking Crises?

In an era defined by rapid geopolitical shifts and technological transformations, the Americas region finds itself at a pivotal juncture. According to Javier Enrique Medina Vásquez, Deputy Executive Secretary of the UN Economic Commission for Latin America and the Caribbean (ECLAC), the guiding principles that have historically shaped governance across the region are undergoing profound changes. Security, now a dominant force in policy formulation, has emerged as the cornerstone of contemporary governance strategies, overshadowing other priorities.

Delivering the keynote address at the 17th National Dialogue for a Social Mexico, titled “Horizons 2030 for Development”—an event hosted by the National Autonomous University of Mexico (UNAM)—Medina Vásquez emphasized the depth of this transformation. “We are not witnessing an era of change,” he declared, “but rather a change of era.”

This statement encapsulates the sense of urgency permeating discussions on the region’s future, where globalization, economic stagnation, and institutional fragility intersect to form a complex and daunting reality.

The New Landscape of Globalization

Medina Vásquez outlined a redefined globalization shaped by several key dynamics:

1. Trade Slowdown: While the trade of goods and foreign direct investment flows have decelerated, trade in services is experiencing a rapid ascent, signaling a shift in economic priorities.
2. Technological and Geopolitical Rivalry: This has catalyzed the geographic reorganization of global value chains, often driven by protectionist policies and industrial subsidies.
3. Climate Change: The economic and social costs imposed by climate change have created a pressing need for sustainable development strategies.
4. Tax Reforms: Changes in international corporate taxation are reshaping the rules of global economic engagement.

These factors collectively reflect a world in flux, where traditional economic models are increasingly ill-equipped to address emerging challenges.

The Vicious Circles Limiting Progress

Medina Vásquez highlighted three interlinked “vicious circles” that constrain the region’s ability to achieve sustainable development:

1. The Trap of Low Growth Capacity: Labor productivity in the region remains dismal, with current levels 4% lower than in 1980. This stagnation is compounded by a historically low investment rate and limited job creation, as evidenced by the 1.5% annual job growth recorded between 2011 and 2019—the lowest in 70 years.
2. The Trap of Inequality: Despite improvements in access to education, the quality of learning has deteriorated. This disparity reinforces inequality and undermines social mobility and cohesion.
3. The Trap of Institutional Weakness: A lack of long-term state policies and the erosion of institutional capacity have left governments ill-equipped to guide economies or channel private sector contributions effectively.

Together, these traps create a self-reinforcing cycle of stagnation, where economic, social, and governance challenges feed into one another.

A Call for Anticipatory Governance

In light of these systemic challenges, Medina Vásquez stressed the need for a paradigm shift toward anticipatory governance—a forward-looking approach that places the future at the center of policy planning. This framework, endorsed by the UN as part of its Future Summit initiatives, advocates for:

• Legislative Foresight: Building prospective capacities within governments to anticipate long-term challenges.
• State Continuity: Ensuring that forward-thinking policies endure beyond electoral cycles, transforming them into state-wide imperatives.
• Multi-Stakeholder Engagement: Integrating Congress, the Executive, academia, civil society, and the private sector into cohesive governance systems.

Such a shift demands harmonized cooperation between political powers, moving beyond the traditional boundaries of presidential systems.

Medina Vásquez’s analysis underscores a stark reality: the region’s institutions are at a critical juncture. Without decisive action, the interlocking crises of inequality, economic stagnation, and governance failures risk becoming entrenched. Yet, his call for anticipatory governance offers a pathway forward—a strategy rooted in long-term thinking and collaborative action.

As the Americas navigate this “change of era,” the question remains whether its leaders can rise to the occasion. Can the region’s governments, institutions, and citizens align their efforts to confront these multifaceted challenges? Or will the weight of the past continue to stymie progress?

The answers lie in the willingness to embrace a future-oriented vision, one that transcends political divisions and short-term gains. As Medina Vásquez aptly put it, “The future must be at the center of our governance.” Only by looking ahead can the Americas hope to rewrite their trajectory in an increasingly uncertain world.