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A Challenge for the United Nations 27 Graciana Del Castillo UNITED NATIONS ECLAC ECONOMIC COMMISSION f o r La t in A m e r ic a a n d t h e C a r ib b e a n GERT ROSENTHAL Executive Secretary OSCAR ALTIMIR Deputy Executive Secretary C E P H L R e v ie w NUMBER 55 APRIL 1 995 SANTIAGO, CHILE ANIBAL PINTO Director o f the Review EUGENIO LAHERA Technical Secretary UNITED NATIONS Notes and explanation of symbols The following symbols are used in tables in the Review: (...) Three dots indicate that data are not available or are not separately reported. (-) A dash indicates that the amount is nil or negligible. A blank space in a table means that the item in question is not applicable. (-) A minus sign indicates a deficit or decrease, unless otherwise specified. (.) A point is used to indicate decimals. </) A slash indicates a crop year or fiscal year, e.g., 1970/1971. (-) Use of a hyphen between years, e.g., 1971-1973, indicates reference to the complete number of calendar years involved, including the beginning and end years. References to “tons” mean metric tons, and to “dollars”, United States dollars, unless otherwise stated. Unless otherwise stated, references to annual rates of growth or variation signify compound annual rates. Individual figures and percentages in tables do not necessarily add up to the corresponding totals, because of rounding. CEPAL Review is prepared by the Secretariat of the Economic Commission for Latin America and the Caribbean. The views expressed in the signed articles, including the contributions of Secretariat staff members, however, represent the personal opinion of the authors and do not necessarily reflect the views of the Organization. The designations employed and the presentation of material in this publication do not imply the expression of any opinion whatsoever on the part of the Secretariat concerning the legal status of any country, territory, city or area or its authorities, or concerning the delimitation of its frontiers or boundaries. LC/G.1858-P — April 1995 United Nations Publication ISSN 0251 -2920 / ISBN 92-1-121202-2 Applications for the right to reproduce this work or parts thereof are welcomed and should be sent to the Secretary of the Publications Board, United Nations Headquarters, New York, N.Y. 10017, U.S.A. Member States and their governmental institutions may reproduce this work without application, but are requested to mention the source and inform the United Nations of such reproduction. Copyright © United Nations 1995 All rights reserved Printed in Chile CEPAL REVIEW 55 CONTENTS A summary of the ECLAC proposal 7 Eugenio Lahera, Ernesto Ottone and Osvaldo Rosales Post-confllct peace-building: a challenge for the United Nations 27 Graciana del Castillo Decentralization and democracy: the new Latin American municipality 39 Eduardo Palma The political economy of protection after the Uruguay Round 55 José Tavares Trade policy and international linkages: a Latin American perspective 65 Marta Bekerman and Pablo Sirlin Capital movements and external financing 81 Benjamin Hopenhayn The impact of exchange-rate and trade policy on export performance in the 1980s 95 Graciela Moguillansky The present state and future prospects of the environment in Latin America and the Caribbean 109 Nicolo Gligo Youth expectations and rural development 127 Martine Dirven Transnational corporations and structural changes in industry In Argentina, Brazil, Chile and Mexico 143 Ricardo Bielschowsky and Giovanni Stumpo El Salvador: industrial policy, business attitudes and future prospects 171 Roberto Salazar Technological change and structuralist analysis 191 Armando Kuri Guidelines for contributors to CEPAL Review 199 APRIL 1995 CEPAL REVIEW 55 A summary of the ECLAC proposal Eugenio Lahera Ernesto Ottone Osvaldo Rosales Technical Secretary, There is growing consensus that although a solid, balanced CEPAL Review. macroeconomic base is a necessary condition for development, Secretary o f the it is not of itself enough to ensure that development is Commission (ECLAC). actually achieved or that its fruits will be enjoyed by the population as a whole. In a series of documents, ECLAC Economic Affairs Officer, ECLAC. has been defining a coherent agenda of public policy reforms designed to ensure a change in production patterns accompanied by greater social equity. This article seeks to present a summary of this proposal, leaving aside for this reason the underlying diagnosis of the regional situation and the general frame of the strategy. The broad lines of the proposal are set forth in section I, and the remaining five sections deal with specific aspects. Thus, section II analyses issues connected with the microeconomic setting, including production development policies, technical change and the sustainability of development. Section III deals with the macroeconomics of changing production patterns, with special attention to stability and growth, saving and investment, and public sector finance. Section IV covers social development, as part of an integrated approach, and analyses the generation of productive employment, the reform of education, social integration and ways of overcoming poverty. Section V considers various matters connected with the form of relations with the international economy, such as foreign trade, macroeconomic policy and capital movements, and open regionalism. Finally, section VI deals with political aspects and State intervention, including participative political regimes, the interaction of the various agents, and reform of the State. APRIL 1995 8 CEPAL REVIEW 55 • APRIL 1995 I The broad lines of the ECLAC proposal1 Linking up with the international economy involves far-reaching changes in institutions at many levels: within the enterprise; in the relations between employers and workers, between government and business, and between government and workers; at the regional level of government; in the political system itself, and in overall human relations. Therefore, opening up an economy to the exterior is much more than merely lowering tariffs. It means embarking on a whole new way of functioning: economically, socially and politically. Fernando Fajnzylber The main concepts with regard to changing produc­ intersectoral linkages and the raising of productivity tion patterns with social equity proposed by e c l a c throughout the entire system. Thus, industrialization may be summarized in the five aspects set forth must go beyond the narrow sectoral framework in below.2 which it has traditionally been approached and must Firstly, the central idea around which all the be linked up with primary-sector and services acti­ others revolve is that changing production patterns vities, so as to integrate the whole system of produc­ must be based on the systematic and deliberate incor­ tion and promote the progressive homogenization of poration of technical progress: in the current context levels of productivity. Still within the area of the of globalization the basis for the international compe­ microeconomic setting, it is held that changing pro­ titiveness of the countries of the region can only be duction patterns must be compatible with conserva­ that of achieving ever-higher levels of productivity. tion of the physical environment, and the environmental Technical progress is not restricted to the develop­ and geographico-spatial dimension must therefore be ment and adaptation of technology: it also includes fully incorporated into the development process. business management capacity and improvements Secondly, it is emphasized that coherent and stable both in general organization and in the quality of the macroeconomic management, while not a sufficient labour force. condition on its own, is of fundamental importance Changing production patterns must include the for changing production patterns with social equity, entire system within which the enterprises operate: since this demands consistent management of a whole the technological, energy and transport infrastructure; set of monetary, financial and exchange-rate instruments, the educational system; relations between workers as well as appropriate measures in terms of taxation and and employers; the whole apparatus of public and government spending. The exact content, order of ap­ private institutions, and the financial system. This is plication and graduality of adjustment programmes why the proposal stresses the systemic nature of and the links between short- and medium-term competitiveness. It also calls for the modernization of policies must be determined with particular care. systems of production as a whole, with emphasis on The challenge raised by the proposal calls for a substantial rise in the investment rate above current □ The authors wish to express their gratitude for the valuable levels, which in turn means that per capita consump­ comments offered by Renato Baumann, Mikio Kuwayama, tion must grow more slowly than the per capita pro­ Wilson Peres and Aníbal Pinto. duct, thus permitting an increase in saving. In view of 1 This section is based on Rosenthal, 1993/1994. the structure of income distribution in the region, this 2 The main documents on this subject are: ECLAC, 1990, 1991, reduction in the growth rate of consumption should 1992a, 1992b, 1993, and 1994a, 1994b and 1994c. For a general be the responsibility of the high-income strata and overview of the ECLAC strategy, see Ottone, 1992/1993; Baumann, 1994; Lahera, 1994, and Rosales, 1994. the government. A SUMMARY OF THE ECLAC PROPOSAL • EUGENIO LAHERA, ERNESTO OTTONE AND OSVALDO ROSALES CEPAL REVIEW 55 • APRIL
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