Economic Freedom: The Only Way for Latin America to Escape Its Slow-Growth Path
After enjoying solid rates of economic growth from 2004 to 2013, with reduced poverty, rising incomes, and a growing middle class, most countries in Latin America are now confronting a sharp economic deceleration. Little was done during the good years to implement difficult—but necessary—structural reforms to remove the real obstacles that have limited productivity growth and thwarted convergence with more advanced economies. Economic freedom—as measured by the Index of Economic Freedom—even declined in the region as a whole. The foundations of well-functioning free-market democracy remain fragile in Latin America. This Heritage Foundation Backgrounder examines reform failures, examines Latin American countries’ weaknesses and strengths, and provides a blueprint for how to restore much-needed economic freedom and growth in the region.