Poverty in Latin America Continues to Decrease for the Third Consecutive Year - ECLAC

ECLAC --- 5 Dec. 2006 --- Latin America has turned in its best performance in 25 years in economic and social terms. Progress in poverty reduction, together with improvements in unemployment and, in some countries, income distribution, as well as increases in the number of jobs, are the main factors underlying the positive trend in a number of the region's countries.

These encouraging trends are reflected in the most recent estimates of poverty and indigence, which decreased, for the third consecutive year, in 2005. According to the latest available figures, in that year 39.8% of the population of Latin America and the Caribbean (some 209 million people) lived in poverty and 15.4% (81 million people) lived in extreme poverty or indigence. This represents a decrease of more than 4% in relation to figures for 2002, which registered levels of poverty and indigence of 44% and 19.4%, respectively.

The Social Panorama of Latin America 2006, released today by ECLAC's Executive Secretary José Luis Machinea, also gives estimates of the magnitude of poverty for 2006. Its projections for this year estimate that the number of people living in poverty and extreme poverty in the region will continue to decline to 38.5% (205 million people) and 14.7% (79 million).

These figures indicate decreases in rates of poverty and extreme poverty in numerous countries in the region, as compared to 2001 and 2002. The most significant improvements occurred in Argentina (26% poverty rate in 2003-05, compared to 45.4% in 2000-02) and Venezuela (37.1% in 2003-05, compared to 48.6% in 2000-02). Colombia, Ecuador, Mexico and Peru also presented decreases of nearly 4 percentage points.

While overall progress in Latin America is encouraging, poverty levels remain high and the region still faces a great task, the ECLAC report states.

ECLAC uses these new figures as the basis for a fresh examination of regional progress toward the first target of the UN Millennium Development Goals (MDG): eradicate extreme poverty and hunger by the year 2015. The projected decrease in extreme poverty for 2006 represents a 69% advance toward meeting the first MDG. In this respect, the region is well-positioned in its commitment to reduce extreme poverty by half by the year 2015.

While the long-term perspective suggests that income disparities will persist, the past six years have seen overall improvements, especially in four countries: Brazil, El Salvador, Paraguay and Peru.

The report also compares measurements of absolute and relative poverty.

The 2006 edition of the Social Panorama examines changes in labour market indicators and compares trends over the 2003-2005 period with those from 1990-2002. ECLAC concludes that the upturn in employment and, partly, in wages over the last two years has not been accompanied by significant changes in the quality of new jobs.

The report indicates that the current levels of coverage of employment-based social security systems cannot sustain progress toward universal pension and retirement regimes in which minimum benefits can be financed over the long-term.

This year's ECLAC report addresses two issues of special relevancy for Latin America and the Caribbean: the socio-economic inequalities faced by indigenous peoples, and the changes currently underway in the region in family composition.

As regards indigenous populations, ECLAC highlights two main points: the emergence of indigenous groups as active social and political agents, and the consolidation of the international standard of rights, and its implications for public policy. The diversity among indigenous groups and the persistent inequality and inequities that affect them pose a great challenge to 21st-century democracies in terms of State reforms and policies.

In its chapter on the Social Agenda, the Social Panorama of Latin America analyses changes in the structure of families and reviews family-oriented programmes and policies in the region. The report takes account of the continuing trend toward greater variety of family types, and particularly the greater proportion of single-person and female-headed single-parent households.

This requires changes to overcome the current limitations of public institutions responsible for family issues in the region and a new approach by governments to family policies and programmes.