Development Centre

Renewed EU-LAC partnerships essential to driving a green, local and job-rich recovery in Latin America and the Caribbean, say EU and LAC actors


Paris, 23 July 2021 - Policy makers in Latin America and the Caribbean (LAC) and Europe are facing increasingly complex decisions as they tackle challenges exacerbated by the COVID-19 pandemic. The crisis has hit LAC harder than any other region in the world, largely because of its pre-existing economic and social weaknesses. As a result, the region has lost over a million lives and suffered a drop in GDP slightly below 7.0 % between 2019 and 2020. The pandemic has brought to the fore challenges in various dimensions, including the vulnerability of social protection systems, insufficient regional integration, the untapped potential of regional production networks, as well the need for renewed multi-stakeholder partnerships – notably between Europe and Latin America.

These issues were discussed during Development in Transition: Dialogues to chart new paths for Latin America and the Caribbean, a series of international meetings held between 1st and 16th of July 2021. Organised by the United Nations Economic Commission for Latin America and the Caribbean (ECLAC), the European Commission, the Organisation for Economic Co-operation and Development (OECD) and its Development Centre, government officials, including ministers, civil society and private sector representatives from over 35 LAC and European countries attended the meetings.

The series of events was kicked off by a High-Level opening session where LAC and EU economic and political leaders discussed the recovery in the framework of Development in Transition. Participants also included representatives of the European Council, with the past and current presidencies of Portugal and Slovenia. Slovenia emphasised the relevance of Development in Transitionto frame reflections on international co-operation and stated its commitment to pursuing the discussion, recognising the importance of engaging in the exchange of experiences, mutual learning and better measurement of development outcomes to allow and sustain countries’ transition from low-income to middle-income status.

During the various thematic seminars and workshops, participants agreed that the EU and LAC should deepen their engagement on an equal footing and “co-create” the conditions for a stronger, more inclusive and sustainable recovery path. To that effect, participants stressed the need to transform policies and partnerships to address the main challenges that policymakers face in LAC today, as highlighted, for example, in the Latin American Economic Outlook. Participants outlined the following priority areas for action in LAC:  

  • Strengthening the resilience of Primary Health Care Systems that play a critical role in dealing with the pandemic.

  • Putting well-being at the centre of policy-making to foster multidimensional measures that prioritise people’s needs.

  • Building a resilient recovery path with a focus on territories (regions), decarbonisation, digitalisation and technology transfers, and economic reform coupled with equitable access to vaccines.  

  • Identifying opportunities for regional value chain integration and new productive capabilities, starting with the health sector,as the global economy recovers from COVID-19.

  • Creating fiscal policies to mitigate the effects of the pandemic by increasing tax revenues and promoting more progressive tax instruments, while ensuring that public spending supports the most vulnerable groups.

  •  Developing and financing the expansion of social protection systems for all, beyond just the formal sector.

  • Rethinking international co-operation as a facilitator between LAC and EU, co-creating and testing new forms of collaboration and partnerships on an equal footing, to design more adequate and flexible solutions for the recovery.

Throughout the debates, participants highlighted the relevance of the Development in Transition framework as a holistic approach to successfully tackling policy challenges in LAC, using this crisis as an opportunity to jointly rethink development models, upgrade co-operation mechanisms and tools, and build resilience to future crises.

Participants stressed the need to expand and consolidate the Development in Transition narrative by involving a wide range of countries, actors and policy communities to better understand and measure the multidimensionality of development; to enable international co-operation to take on a facilitating role; and to contribute to building new partnerships with the LAC region in the post COVID-19 world.

Going forward, the EU Regional Facility for Development in Transition will build on these discussions, seeking to provide a space to co-create sustainable and inclusive recovery paths for LAC countries, identifying innovative recovery policies and determining the future role and opportunities of an enhanced EU-LAC partnership. A forthcoming High Level Panel will guide these efforts and contribute to advancing the Development in Transition approach for more inclusive national and international policies and practices.

The organisers would like to thank, among other institutions, the Carolina Foundation, the EU LAC Foundation, the EuroAmerica Foundation, the Inter-American Development Bank, and the Iberoamerican General Secretariat (SEGIB) for their active contributions.

For further information, please contact Bochra Kriout (+33 145 24 82 96) at the OECD Development Centre Press Office.