Nearly 30 million Latin Americans risk sliding back into poverty

"Favelas" (slums) in São Paulo, Brazil. (Credit: Francisco Antunes/Flickr)

One in three Latin Americans who left poverty since 2003 – an estimated 25 million to 30 million women and men – risk sliding back into poverty, according to a United Nations Development Program (UNDP) report released on Tuesday.

Between 2003 and 2013, public policies focusing on education and job creation in the region helped lift around 72 million people out of poverty and move 94 million into the middle classes.

After the global financial crisis, however, economic growth slowed drastically across the region. Brazil and crisis-wracked Venezuela are mired in deep recessions, and other nations face rising unemployment as well as changes in oil and commodity prices.

Now, the report said, the decrease in poverty has begun to reverse itself. For the first time in a decade, the last few years have shown an increase in the number of people in absolute poverty (which the report defined as living on less than $4 a day), and the 25 million to 30 million at risk of falling back into poverty are not poor by definition, but are hovering under the middle class (living on more than $10 a day).

This reversal is not due to the economic slowdown alone. According to the report, it also results from the limits of labor and fiscal expansions across the region and from high numbers of precarious, informal and low-productivity jobs.

Following this trend, Latin America is forecasted to see a second year of economic contraction this year, with unemployment on the rise.

Jessica Faieta, the U.N. assistant secretary general and UNDP regional director for Latin America and the Caribbean, said it is critical to protect the region’s past achievements and promote inclusive policies for the future.

“The challenges of sustainable, holistic and universal development do not end at a certain income threshold: We don’t ‘graduate’ from development challenges unless we can respond accordingly to the multiple dimensions that enable people to live the lives they consider valuable,” said Faieta at the report launch in Panama.

“Right now, on the one hand, we must protect the region’s past achievements, including preventing millions from of people from falling back into poverty; on the other hand, we must also promote inclusive policies and comprehensive strategies for populations suffering from historical discrimination and exclusion.”

The report laid out a detailed “new generation” of policies in line with the U.N.’s Sustainable Development Goals (SDGs) in order to boost resilience and prevent setbacks. The policies would work to strengthen four key factors: physical and financial assets; care systems, in particular for children and the elderly; social protection and labor skills.

The UNDP is also urging Latin American governments to continue to set aside funds to combat poverty and to focus on reducing gender inequality faced by women, warning that poverty can’t be resolved with economic growth alone. Damaging historic gender, racial and ethnic gaps are persistent across the region, they stressed, and all forms of inequality and discrimination require policy attention above and below income lines.

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Lisa Nikolau

Lisa Nikolau is a Madrid-based reporter for Humanosphere, covering gender equality, indigenous rights and poverty in Latin America and worldwide. Find her on Twitter at @lisanikolau, email lisa.nikolau@humanosphere.org or see her latest work at www.lisanikolau.com