18% Of Caribbean’s Citizens Living On Less Than US$3.10 a day – IDB

[Kaieteur News] A recently published report by the Inter-American Development Bank (IDB) revealed that the Latin America and the Caribbean (LAC) region faces a social challenge with nearly 18 percent of the population living on less than US$3.1 per day.

The aforementioned was highlighted by IDB’s Chief Economist, Eric Parrado in the preface of the report titled, ‘PREPARING THE MACRO-ECONOMIC TERRAIN for Renewed Growth’.

Parrado said, “Policymakers in the region need to design and implement policies that close development gaps and, at the same time, help them weather the challenges of the economic environment.”

He underscored the importance for the LAC region to address a triple challenge-three complex, interconnected macroeconomic issues-to achieve its population’s aspirations for development and welfare.

In highlighting the region’s social challenge, Parrado noted that not only is 18 percent of the population living on less than US$3 a day, but the poverty level exceeds that of a decade ago.

“While some correction has taken place, the pandemic increased poverty overall, and recently, Russia’s war in Ukraine has made it even more difficult to reclaim lost gains. In addition to poverty, inequality is also on the rise,” he said.

Secondly, he pointed out that the region faces a fiscal challenge, noting that the COVID pandemic stressed fiscal resources and expenditures. “As a result, after the crisis, sovereign debt reached over 70% of GDP and while fiscal consolidation is still possible many risks remain,” he added.

The economist also added that the region faces a growth challenge. He said productivity growth and, consequently, long-term economic growth is currently estimated at only around 2 percent too low to meet the development goals of most countries in the region.

In addition to these specific issues, Parrado noted that the region also faces the cross-cutting challenges of dealing with climate change, advancing diversity, inclusion, and equity, and strengthening the institutional context and the rule of law for a better business environment.