Latin American Economic Outlook 2012

Transforming the State for Development

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Even in the midst of a global financial crisis, Latin American and Caribbean economies find themselves in better condition than in years past. Latin America must seize this opportunity to design and implement good public policies. The greatest of the long-term objectives of Latin American states remains development: economic growth and structural change that is rapid, sustainable and inclusive. In particular, governments must reduce inequalities in income, public-service delivery and opportunities, as well as promote the diversification of economies, often concentrated on a few primary-product exports.

Improved efficiency of public administration is crucial to address both the short-term and long-term dimensions of these challenges. The real change, however, will come if Latin American and Caribbean states carry out meaningful fiscal reforms, making them not only more efficient but also more effective. The increased effectiveness of fiscal policy holds the promise to provide resources needed to address the key challenges of economic development. Three key priority areas for investing additional resources have been highlighted by many governments in the region for their potential to raise competitiveness and social inclusion: education, infrastructure and innovation. In each of these areas, more efficient administration and more effective strategic action is needed from states.

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Public administration for development

OECD Development Centre

This chapter assesses public administration in Latin America. The region faces many important and common issues such as the quality of civil service, managerial transparency and the high level of centralisation in public administration. In addition, the Latin American state has limited resources to tackle some of the larger goals such as the supply of goods, the fostering of social equity, the delivery of social services, the re-allocation of resources and the stabilisation of the economy. However, Latin American countries are now better positioned than ever to reform their public sector and create states that are able to meet their development needs. This requires proper co-ordination of public policies such as the mobilisation of fiscal resources, the professionalisation of civil service, the appropriate use of new technologies and the mobilisation of diverse public and private actors.

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