According to the Economic Commission for Latin America and the Caribbean (ECLAC), on Tuesday, poverty in Latin America decreased to 27.3% in 2023, the lowest figure since 1990, equivalent to 172 million people and representing a decrease of 1.5% compared to the previous year. Extreme poverty also recorded a decline, reaching 10.6%, that is, 66 million people, which is 0.5% lower than in 2022, although still above the levels of 2014.
Despite modest GDP growth expectations for this year (1.7% in Latin America), poverty is expected to decrease slightly in 2024, by 0.5 percentage points, while extreme poverty would remain unchanged, according to ECLAC in its report 'Social Panorama of Latin America and the Caribbean'. ECLAC’s executive secretary, José Manuel Salazar-Xirinachs, warned that the outlook is not very encouraging and called for strengthening social protection programs.
The reduction of poverty in the region in 2023 is primarily due to the increase in income from wage employment, especially in economies like Brazil, but countries such as Paraguay, the Dominican Republic, El Salvador, or Colombia have also contributed, as indicated by ECLAC. Public transfers, which include non-contributory social protection programs, also had a significant impact on the reduction of poverty.
Alberto Arenas, Director of Social Development at ECLAC, highlighted that non-contributory pension systems have been fundamental in reducing the poverty rate among people over 65 in the last 20 years. To eradicate poverty in the region by 2030, the report suggests allocating a minimum of specific financial resources for financing non-contributory social protection. In Latin America, poverty continues to affect groups such as working-age women, girls, boys, indigenous people, Afro-descendants, and inhabitants of rural areas unequally.
The aging population and the care crisis also exacerbate these inequalities due to the unfair division of labor, according to Arenas, which particularly contributes to the gender gap. More than half of women outside the labor market are engaged in unpaid domestic and care work, which hinders their labor inclusion and access to social protection.