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Latin American and Caribbean (LAC) countries have achieved tremendous advances in economic, political, and social development in recent decades. They have expanded and diversified their private sectors, pioneered innovative social development policies, are endowed with rich natural resources, enjoy unique cultural diversity, and are expanding their international engagement.

The region faces challenges on local governance, human capital, public investment, resources and other social, economic, cultural and political factors

Currently, many LAC countries face critical challenges and opportunities in harnessing this potential for inclusive development to be achieved. This exposes the need for regional and global knowledge exchange, as well as capacity building in a variety of sectors, to decipher the regions’ obstacles and implement evidence-informed solutions.

Considering this, the experts at the LSE Latin America and the Caribbean Centre (LACC) work in countries across the region on the following topics:

-  Public policy and urban infrastructure
-  Trade, innovation and entrepreneurship
-  Violence, security and peace
-  Inequality, citizenship and inclusion

Public policy and urban infrastructure

Following the global decentralisation trends, LAC countries have experienced deep transformations within their government structures. However, these processes have not been uniform, resulting in heterogeneous impacts in terms of efficiency and equity regarding the provision of goods and services such as health, education, and infrastructure. The reallocation of responsibilities has also transformed the systems of intergovernmental relations, posing new challenges in terms of governance, public administration and public management. Some specific characteristics of the region, such as territorial inequalities within countries, high levels of urbanisation, embedded illicit economies, limits to public policy due to low taxation, and the recovery and strengthening of democratic institutions, form a complex landscape that challenges the performance of policymakers and different stakeholders.

Trade, innovation and entrepreneurship 

More than a decade after the major trade liberalisation processes that occurred in LAC, the task of disentangling the effect of different macroeconomic and structural reforms from other policies is still pending. This challenge is particularly relevant in a context where advanced economies are witnessing shifts towards protectionist policies. The measures that enhanced the region’s resilience to external shocks in the past may not be effective today. On the one hand, LAC must overcome vulnerabilities linked to natural resource specialisation, wage inequalities propelled by skill premiums, and informal employment. On the other, policymakers and businesses must keep pace with ongoing efforts to leverage globalisation trends, by perusing innovation and creative economies, as well as strengthen relationships with other fast-growing regions – i.e. Asia – and develop beneficial treaties that propel competitiveness and productivity.

Violence, security and peace building

LAC showcases successful examples of democratisation, as several countries have built political systems that provide regular and fair election processes, enhanced recognition of fundamental civil and political rights, and undertaken important peace processes. However, manifestations of violence are widespread. For instance, illicit economies sustain homicides and other forms of crime, while policing and judicial systems often fall short of recognisable ‘rule of law’, and violence manifests along gendered divides. Moreover, environmental and migratory conflicts frequently become violent, curtailing the efforts made by governments, communities, and different organisations to build peace. In this context, human rights, climate activism, security and development converge, putting pressure on the policy agenda to clarify the drivers of violence and set out measures to sustain peace.

Inequality, citizenship and inclusion

LAC is the most unequal region in the world. The struggle against different dimensions of inequality has emerged as a defining feature in the region’s history. Income, access to health and education, and labour reflect key dimensions of unequal distribution among vulnerable and historically disadvantaged populations. Pioneering efforts have been made to address inequality, most prominently seen in the implementation of innovative social protection policies. Inequality has had an adverse effect on productivity growth and human capital accumulation, presenting a major obstacle to sustainable development and inclusive growth. Gender, ethnic-racial status, social class, citizenship and circumstances related to different stages in the lifecycle are responsible for perverse outcomes. Reducing inequalities by guaranteeing full enjoyment of the rights and entitlements of citizenship and ensuring social and economic inclusion in therefore a priority on the region’s policy agenda.