Contrast how two (2) political and economic policies effected the global engagement of Latin American nations.

Political and Economic Policies

Latin America has moved from closed-door policies and populist policies to the open market policies and nationalist policies which helped in transforming the global engagement of the Latin American nations (Mori & Zanatta, 2017). The open market policies were more sound and led to increased financial development as well as the broader adoption of the exchange rate which is more flexible. This has increased the resilience of the region to the external shocks. This macroeconomic framework offered more room for economic maneuver but large internal, as well as external imbalances, still exist. These imbalances are caused by the social democratic policies put in place by the nationalist leaders elected. These policies have exposed the nations to the external policy environment’s risks. The nationalist leaders elected in most of the Latin American nations were keen in the implementation of a vast range of social programs meant to combat poverty (Mori & Zanatta, 2017). Nevertheless, most of these programs proved to be unsustainable as they were coupled with global economic policies which discouraged foreign investment. Moreover, the political environment created by these leaders saw the Latin American countries witnessing substantial increases in the public spending and massive corruption. As a result, the growth of the region was stalled.

The macroeconomic framework of open market policy is impacting the nation positively but the social democratic policies implemented by the nationalist political leaders elected in the region are impacting the nations negatively. As a result, the overall growth of the region is stalling and lagging behind from other regions globally. Hence, the policymakers in the region should find a way of facilitating an adjustment to the external conditions which are less accommodative to the political and economic policies of the Latin American nations. This can be done by working towards the achievement of long-term, all-inclusive and sustainable development. Also, the policymakers must find ways of preserving credibility in the long-run solvency of the public finances and the social safety nets put in place in the past years must be safeguarded to deal with corruption and increased public spending.

Reference

Mori, A., & Zanatta, L. (2017). Latin America at a Crossroads. Milano: Ledizioni.