OAS Secretary General José Insulza
Latin America could have done more during the “boom times” to prepare for the tough times that lie ahead, the outgoing OAS Secretary General José Insulza told Embassy on the eve of a historic Summit of the Americas.
“We enjoyed periods of enormous growth largely due to the commodity boom and to a limited extent that prosperity spread to the bottom of the pyramid,” said Insulza, whose two terms (2005-2015) coincided with rapid economic growth on the continent.
The Secretary General said poverty reduction had been impressive – declining from 42% in 2002 to 28% in 2012 – but he warned that those in the “struggling classes” who had climbed on the bottom rung of the ladder could fall back into poverty in tough times.
“We did not make the necessary reforms… We did not diversify our economies as much as we could, we did not increase the quality of education, our investments in science and technology were low.”
He added that skills shortages were starting to show in many economies and that the quality of tertiary education needed improving.
While the continent’s economies may be buffeted by lower commodity prices, Insulza is confident Latin America’s democracies are stable enough to “weather the storm”.
Venezuela is a “concern” says the Secretary General. “[Venezuela] did not make provisions for when the prices would drop. They have spent most of the money – certainly on very worthy causes – but now Venezuela doesn’t have many reserves and they depend too much on oil.”
Despite the gloomy economic outlook, the Summit will be historic as US and Cuba will be seated around the table for the first time, although it is uncertain whether the two countries will have opened embassies by then.
There are limits to what US President Obama can achieve, admits Insulza, but he says that should not detract from the “enormity” of the diplomatic development.
No announcements are expected on the Colombian Peace Process either, but Insulza is confident an agreement will be in place by the end of the year once compromises are found on the thorny issue of post-conflict justice.