Davos 2022: Latin America's path to a resilient economic recovery

Against the backdrop of a global pandemic, climate change, and the war in Ukraine, Latin American political leaders came together on a Davos panel to discuss how their countries will tackle these pressing issues, as well as their efforts to implement long-lasting solutions that benefit people and planet.

As in many parts of the world, the region is working hard to overcome the effect of COVID-19 on the economy. The Dominican Republic's tourism-based economy represents between 16-18% of the country's GDP and 20% of jobs in the country, said President Luis Rodolfo Abinader. Therefore, the government had to focus on investing in people's health first to be able to bring tourism back to life.

For Peru, economic growth in 2021 was positive and strong, registering a 13.5 point increase, said Dina Ercilia Boluarte, Vice-President and Minister of Development and Social Inclusion. Peru's leadership has been focused on digitalization as a means to a more effective and efficient economic recovery, alongside efforts to attract environmentally-conscious investors, working closely with the private sector to generate employment, and tackling labour informality.

President Ivan Duque, amongst other initiatives, said that improving access to formal employment for young people has helped to boost the economic recovery in Colombia. With unemployment growing during the pandemic, the country decided to subsidize 25% of the minimum wage to companies employing young adults between 18-28 years old. So far, the measure has benefited around 400,000 young people.

Latin America is home to a large part of the world's biodiversity, much of which is threatened by climate change. President Duque explained that 50% of his country is rainforest, while the Amazon occupies 35% of its land. For that reason, he considers it a responsibility to set ambitious goals and implement urgent action towards net-zero by 2050.

For example, the country is looking to declare 30% of its territory as a protected area in 2022, has engaged hundreds of private sector players and consumers in a green agenda, and is making restless efforts on green mobility. These are steps that, in his view, show that resilience is about turning adversity into opportunity.

After only 15 days in office, Rodrigo Chavez, President of Costa Rica, said that his country will be focusing on measures that tackle river pollution, sanitation, waste management, and the renewable energy transition. Costa Rica became a member of the OECD only a year ago, and the President said that he is committed to strengthening human capital with education, health and public security as top priorities, with rebuilding with climate-adaptation at the core of his country's development.

Finally, President Abinader Corona added that, despite not being a significant carbon emitter, climate change puts the Latin American country, the Dominican Republic among the 10% most vulnerable countries to climate-related risks. With this in mind, new generations in his country are pushing for environmentally-conscious business models and measures. He said that young people, like his own daughters, refuse to buy from places that use plastic. This growing awareness is seen in the growing trends of eco-tourism, reforestation, and the rehabilitation of the land that has suffered from over-tourism.