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Latin America and the Caribbean
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Growth and Poverty Reduction
  • The Latin America and the Caribbean region (LAC) is likely to come close to achieving the first Millennium Development Goal (MDG) of halving poverty by half by 2015.
  • The share of people living on less than $1 a day in LAC fell only slightly from about 9 percent in 2002 to 8.6 in 2004, moving an estimated 700,000 people out of dollar-a-day poverty.
  • In terms of absolute numbers, 47 million people are still in extreme poverty. Fast progress was also achieved in reducing the share of people living on less than $2 a day in 2002-04.


Region's progress toward the poverty MDG target
1990-2004; a 2015 forecast

 Poverty Graph LAC

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  • Although not as high as the rates of per capita growth in other developing regions, growth among LAC countries continues to be strong, estimated at nearly 4 percent in 2006, almost double the average rate of per capita growth in the 1990s. Growth in the region’s low-income countries was considerably slower.

Fragile states

  • Poverty is increasingly concentrated in fragile states—where there are particularly weak governance, policies, and capacity. In the LAC region’s only fragile state, Haiti, challenges relate to governance, persistent poverty, inequality, unemployment, and violence.


  • Improvements in gender equality influence poverty reduction and growth directly through women’s greater labor force participation, productivity, and earnings, as well as through beneficial effects on child well-being.
    • In LAC, girls’ primary, secondary and tertiary enrollment exceeds that of boys’. However, in several countries, there is a gender gap in enrollment among indigenous and Afro-descendant groups.
    • Success in educating women is beginning to translate into higher women’s labor force participation. Although the average labor force participation rate for women (ages 20-49) is 60 percent or less (2000-04), it has increased significantly in the last two decades.
    • Although their labor force participation rate is low, women represented 40 percent of non-agricultural wage work in 2005—indicating that labor markets are significantly open to women in industry and service sectors.
    • The share of women in national parliament increased over the 1990s but remains low: in 2000-05, the regional average was 16 percent.
Progress toward the Human Development MDGs


  • Some LAC countries are off-track. High malnutrition and micronutrient deficiency are seen in Haiti and Honduras (17 percent of under-five children underweight in 2000 and 2001, respectively), and Guatemala (23 percent, 2003).

Universal Primary Completion

Education in Bolivia

LAC is close to achieving universal primary completion.

The region is close to achieving universal primary completion, having started from a relatively high base and sustained a very strong rate of progress.

Bolivia is an example of a low-income country to have recently met this target.

  • In Peru, the average annual change in primary school completion in recent years has greatly benefited poor people. Between 2000 and 2004, this change was 6.1 percent for the poorest quintile, compared to the population average (1.4 percent).

Child Mortality

  • LAC is close to reducing child mortality by two-thirds by 2015, although some countries still lag behind. But there is wide variation: Haiti had 117 deaths per 1,000 live births in 2004, and Chile just eight.
  • Peru has made strong progress, reducing its under-five mortality rate from 41 per 1,000 live births in 2000 to 27 in 2005.
  • Colombia’s under-five mortality rate in the poorest quintile is 39.1 percent, (15.1 percent in the richest quintile)—evidence of income inequality in child mortality.

Maternal Health

  • Maternal mortality rates remain above what could be expected given the level of development of many countries in the region, 194 deaths per 100,000 live births in 2000. Data limitations are severe in several countries, which makes it difficult to monitor progress over time.
  • Nicaragua has registered exceptional progress in increasing the number of assisted births from 64.6 percent in 1997 to 89.7 percent in 2003/4.
  • Income inequality in access to skilled birth attendants is seen in Colombia where 72 percent of births are attended by medically trained personnel in the poorest quintile, as compared with 99.3 percent in the richest quintile.
  • However, high maternal mortality is often related to uneven service quality rather than to low coverage of assisted births.

Honduras: A successful strategy for improving maternal health

A four-pronged strategy followed in Honduras to reduce its high maternal mortality rate has been successful, involving i) training traditional birth attendants to identify high-risk pregnancies, and deal with obstetric emergencies; ii) more staff and facilities in remote areas; iii) strengthening emergency obstetric care in rural and district facilities; and iv) improving emergency transportation and communication.

The country also introduced improved surveillance to establish the cause of maternal deaths in all recorded cases. All this is associated with the maternal mortality rate in Honduras falling by more than half in the past decade, including in the remotest and poorest areas. (Danel, 1999; Ransom & Yinger, 2002).

Maternal Health Honduras

Combating Disease

  • The spread of HIV can be reversed, as shown in data from Barbados and other countries, where national rates have fallen in recent years.
  • LAC’s tuberculosis incidence rate has fallen from 103 per 100,000 people in 1990 to 64 in 2004. Some countries have shown significant improvement – Haiti’s TB rate has decreased from 484 per 100,000 people in 1990 to 306 in 2004; while Peru’s has fallen from 394 per 100,000 people in 1990 to 178 in 2004.
  • Measles vaccines are reaching the poor in many countries, including Bolivia and Peru. In Bolivia, the average annual change in measles immunization (1998-2003) was 5.5 percent for the poorest quintile (the population average was 4.0 percent).

Using Resources Wisely

  • The region has achieved the water supply target. Strong performers include Paraguay, Ecuador, and El Salvador. In Paraguay, access to improved water supply rose from 62 percent in 1990 to 86 percent in 2004.
  • LAC is on track to meet the sanitation target. However, as the most urban developing region, it has made relatively slow progress in providing sanitation.
  • Countries which have performed well in increasing sanitation coverage from 1990 to 2004 include Guatemala (58 percent in 1990 to 86 percent in 2004); Ecuador (from 63 to 89 percent); Dominican Republic (from 52 to 78 percent); Paraguay (from 58 to 80 percent) and Mexico (from 58 to 79 percent).

The Role of Quality in MDG Progress

While expanding access to education and health remains extremely important, quality plays a critical role.

  • In 2005, an NGO-administered test of a sample of low-income schools across Peru found that half the children at the end of second grade could not read a single word of a simple first-grade text (Cotlear 2006).
  • Health care quality was found to be low in a cross-country study that included Mexico and Paraguay. In numerous cases, clinicians routinely misdiagnosed and mistreated common illnesses, not for lack of training or medicines but for lack of the effort needed for correct diagnosis. (Leonard, Masatu, and Vialou, 2005).

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Official Financing for the MDGs 
  • Official development assistance (ODA) to LAC decreased in 2005 to its lowest level since 2000. Two of LAC’s poorest countries, Nicaragua and Bolivia, saw the biggest decreases, but ODA to Haiti, LAC’s poorest country, nearly doubled.
  • World Bank non-concessional finance to LAC, both to the public (IBRD) and private (IFC) sectors, increased in 2006 following two years of relatively low gross disbursements. This increase is the first major increase during a time of relative financial stability.

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