Chapter 4: Latin America and the Caribbean in 2015
examination of the economic, social and environmental trends that are occurring at larger scales.
Global environmental problems are driven by a number of deep-seated and probably long-lasting trends. If these trends, world economic tendencies, population growth and ageing, skill-based technological change, globalization, and increasing environmental pressures, persist, they will have a profound effect on human well-being and its relationship with the environment. Each of these trends by itself raises difficult policy challenges but it is the interactions between them that will create the greatest dilemmas for policy makers. The scenarios outlined here describe how these trends may evolve but this should not be interpreted as a forecast. Rather they are meant to serve as a description of how different development pathways can generate new policy challenges, both at a national and international level.
Economic interdependence between and amongst LAC countries is likely to increase. Increased trade integration with a wider set of actors will also increase the mobility of already high-skilled labour as well as corporate investment. Increasing economic interdependence
2050, GHG emissions will have doubled compared to 2010, and environmental damage, stemming for example from lower agriculture productivity and rising sea levels, may lower regional GDP. There could also be increasing health costs and productivity losses related to local pollution in many countries. The risk of catastrophic environmental events will increase, and the increase in concentrations of GHGs in the atmosphere will continue, and, potentially more seriously, environmental damage will continue to occur beyond 2050.
Climate change is a crucial challenge for the LAC region. It has various harmful effects not limited to melting of regional glaciers, change in seasons, occurrence of new diseases, frequent floods, and change in overall weather scenarios.
will require
international cooperation in providing global public goods such as basic research, technology transfer and financial assistance. Effective cooperation could boost R&D, allowing coordinated action to curb carbon dioxide emissions and limit damage to growth and well-being.
Despite the decline in absolute regional poverty and shrinking income gaps across countries, the growing importance of skill-based technological progress for growth and rising demand for higher skills can lead to continued polarization of wage distribution within countries. With unchanged redistributive policies, significant increases in inequality will continue, back-lashing on growth, especially if economic opportunities available to vulnerable groups are reduced.
With unchanged or ineffective emission reduction policies, rising economic damage from environmental degradation on account of climate change is likely to hamper growth. By
LAC policy makers will have to face further extinction of species and habitats and the loss of biodiversity. Ecosystems that took millions of years to evolve are in danger when many species populations decline dramatically. The balance of natural processes, such as pollination, is crucial to the survival of ecosystems and human activity. The destruction of coral reefs remains a very important challenge in the various oceans surrounding the region.
The region’s forests are natural sinks of carbon dioxide and produce oxygen as well as help to regulate temperature and rainfall. Covering 30 per cent of the land, forests will face potential challenges from future infrastructure development and demand for food, shelter and clothes from the growing populations. Reforestation programmes will have to complement demand from the residential, agricultural, industrial and commercial sectors.
Health issues also pose huge challenges to the region. Current environmental problems represent many risks to human and animal health. Dirty water is one of the biggest health risks and poses threats to the quality of life and public health. Runoff to rivers can contain toxins, other chemicals and disease-carrying organisms. Air pollutants can also cause respiratory diseases such as asthma and cardio-
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