1 Setting the Scene
The outset of the 21st century brought something of a ‘boom time’ for many resource-rich countries. Driven to a large extent by robust growth in China and other emerging economies, commodity prices boomed from 2002 to 2014. In many Latin American countries, the centuries-old pattern of producing large quantities of extractive resources and soft commodities for export intensified in the context of high prices for oil, gas, metals, minerals and agricultural products. This pattern has often been referred to as the ‘modelo primario exportador’
Looking back over the period of high commodity prices, the overall performance of the lac region vis-à-vis the Millennium Development Goals (mdgs) was positive in aggregate terms. The region achieved two-thirds of the mdg targets,2 which—compared with the other nine regions evaluated by the United Nations—was paralleled only by East and South-East Asia (un, 2015). Yet, substantial development challenges persist. lac countries failed to meet six key mdg targets related to gender equality, the fight against major pandemics, and environmental sustainability (Sanahuja et al., 2015). There was also little progress with respect to the poorest quintile of the population, conditions of self-employed workers, and gender balance in secondary education. Post-2015, lac countries continue to face significant challenges with regard to widespread inequality (in a multidimensional sense, including gender), armed violence, respect for human rights and cultural diversity, public health, the quality of institutions and the strengthening of democracy.
In some ways, these persistent challenges are not surprising. Since the 1980s, scholars and policy makers have highlighted the difficulty of resource-dependent countries escaping the so-called resource curse (Auty, 1993; Karl, 1997; Sachs and Warner, 1997); that is to say, the paradox that resource-rich developing countries—particularly those with weak governance institutions—tend to remain poorer, more autocratic, and more violent and unequal than resource-poor ones (see, e.g., Sachs and Warner, 1997, 2001; Di John, 2011). Large corruption cases also tend to be associated with the resource curse, as illustrated by the recent Brazilian scandals related to the national oil company Petrobras3 or the massive corruption case, involving the Brazilian construction firm Odebrecht that swept across Latin America,4 involving dozens of political figures and officials from both right- and left-wing governments. Such cases erode democratic institutions and help propel anti-system, populist leaders.
While resource nationalism has been the rule rather than the exception in Latin America, governments—and left-wing governments in particular—have sought to alter several facets of the traditional extractivist accumulation pattern. In light of high commodity prices, governments have further sought to
Often referred to as ‘neo-extractivism’, such approaches favour state control over natural resources and the primacy of state-owned extractive enterprises. In spite of official discourses critical of past extractivist strategies, these approaches do not radically alter the former logic of accumulation inherited from (post-) colonial times. Commodity exports remain a pillar of neo-extractivism. During the recent commodity price boom, the pace and intensity of natural resource extraction intensified in all the resource-rich countries of the region, with dire socio-environmental effects on producer regions and host communities (Gudynas, 2010). Rent seeking and rentier-state dynamics did not disappear and, in some cases, were reinforced. A critical question is: how sustainable are such approaches if commodity prices—which began to fall after the 2008 financial crisis and have fallen further since 2014—remain low for a long period of time?
The approach to development in the face of high commodity prices has not been the same everywhere, particularly at the discursive level. Chile, Colombia and Peru pursued (neo-) liberal policies inspired by the (post-) ‘Washington Consensus’, seeking to attract foreign direct investments in agribusiness and the extractive sector. Bolivia, Brazil, Ecuador and Venezuela, by contrast, were swept by a ‘pink tide’, with governments—emerging from social movements—that benefited from high commodity export prices that enabled them to allocate a greater share of government revenues to the poor and the emerging middle classes. Bolivia, Ecuador and Venezuela embraced ‘twenty-first century socialism’, a concept that emerged in the 1990s and was loosely developed in Latin America. They adopted new constitutions that emphasise ethnic diversity and indigenous peoples, who had long questioned the unitary conceptions of nation states imposed upon them. They introduced the concept of buen vivir (sumak kawsay in Quechua or suma quamaña in Aimara), which prioritises living in harmony with the community and nature in an era marked by rising ecological and social concerns.
Against this background, this issue of International Development Policy starts from the assumption that the diverse development experiences in lac since the turn of the millennium offer a wealth of insights into diverse development pathways. It addresses the following research questions: What have been the varied experiences of countries in the region during a time of high commodity prices? To what extent do the alternative development strategies spearheaded
2 Alternative Pathways and Sustainable Development in the Latin American Context
Countries in the lac region have pioneered alternative ways of understanding what can be generically referred to as ‘human progress’. Among such alternatives, the notion of buen vivir (or ‘good living’) has probably been the most influential and revolutionary proposal originating in the region since variants of dependency theory. Broadly speaking, buen vivir is a way of life that simultaneously pursues three aspects of harmony: with oneself, with nature and with society. However, there is no unique conception of buen vivir but three alternative—and contending—ways of understanding it: an ‘indigenista’ or ‘pachamamista’5 conception that prioritises cultural identity, a socialist and statist conception that prioritises equality and resource nationalism, and an ecologist or post-developmental conception that prioritises environmental sustainability. Each conception is rooted in its own ideology and the proponents of each rival conception seek to dominate the left-wing discourse in the region.
While this debate goes on in Leftist social and political circles in Latin American, it is important to recognise that buen vivir is still an aspirational concept. It is rooted in the critique of a Western notion of development as increased material production and consumption at the cost of environmental degradation and widening inequality. It is inspired by indigenous ways of life that seek greater harmony among peoples (collectivity) and with nature (sustainability). Yet there is still a need to define the public policies and political strategies that can allow large and complex societies such as those in Latin America to achieve such a way of life. From this perspective, buen vivir is a concept that summarises a critique and proposes alternative values. But as a concrete alternative containing a set of public policies and defined roles of the state and the market, it is still a project under construction.
In the Andean context—to different degrees depending on the country—sustainable development extends beyond the three traditional dimensions and involves the exercise of effective citizenship by large segments of the population historically deprived of enjoying such rights. Indeed, after five centuries of political and socio-economic exclusion, Indians account for a majority of the poorest in Andean societies. Extractive activities in the Andean region have been concentrated in regions inhabited by indigenous people. Local communities have borne the brunt of the damage to the natural environment and to the social fabric typically associated with mining booms. Although Peru is the country with the largest indigenous population in the Andean region, the buen vivir agenda has not acquired the prominence it did in Ecuador and Bolivia for several historical reasons. That said, Amazonian native communities in all three countries tend to support buen vivir.
Pursuit of buen vivir entails hard choices for those in power. Trade-offs between short-term gains and long-term environmental preservation can be particularly acute for governments committed to breaking with past exclusion and the violation of the rights of indigenous communities. Protecting the rights and respecting the cultures of Indian communities under a ‘pachamamista’ and ecological version of buen vivir means refraining from exploiting subsoil assets at high pace, if at all. In other words, it means relinquishing extractive revenues that could otherwise be channelled to finance basic
How do buen vivir proponents behave once in power? Can leaders in Bolivia or Ecuador decide to effectively abandon the primary commodities export model, devolve effective power to the local level, and ‘do away with modernity’? Can such a strategy be implemented in just one or two relatively small countries while neighbours and major trading partners do not follow suit? The Ecuadoran attempt to receive financial compensation from international donors for not exploiting the oil beneath Yasuni National Park shows that such attempts have not been successful (see Martin, 2014, 2011). In Bolivia, the government proposal to build a highway across the tipnis National Park, or decrees adopted in 2014 and 2015 that limit the scope for the free determination of indigenous peoples for prior, informed consent with regard to extractive projects, hint at the priority of exploiting new natural resource deposits to increase fiscal revenues. The Bolivian state has taken concrete measures towards industrial diversification, building liquefied natural gas (lng) facilities and urea and ammonia plants, and planning to build a petrochemical industry around ethane and methane. In Ecuador, the state is investing in building a ‘city of knowledge’ (Yachay in quechua), whereby investing in human capital is seen as a way of moving beyond ‘extractivism’.
Can we see this as evidence that governments inspired by a buen vivir vision invest more heavily in transition strategies that seek to move away from the primary commodities export model, putting emphasis on economic diversification and human capital development? Variations in experiences and differences in outcomes (or lack thereof) are the subject of several contributions in this issue, which contrast ‘heterodox’ development experiences pursued by countries such as Bolivia and Ecuador, whose governments embraced buen vivir, with that of other countries that pursued more orthodox policies, such as Colombia and Peru. In this issue, Alberto Acosta refers to the challenges of transitioning away from ‘extractivismo’. For him, the success of such transition strategies hangs on the strength and coherence of alternative development strategies and, more importantly, the political and social support that such strategies can muster.
3 Introducing this Thematic Issue
Focusing on the resource-rich Andean region, this issue of International Development Policy examines development experiences and outcomes in countries that display not only exceptionally varied political constellations, but also radically different developmental narratives and strategies. The contributions to this issue are organised into three sections. The first group of chapters examines Latin American development alternatives, tracing their origins, trajectories and influences. The second part considers development policies and outcomes, factoring the role of multilateral development banks and that of China into the equation. Finally, the third section examines legal, regulatory and social issues in relation to extractive industries and the rights of indigenous populations. The chapters in this section also address the high levels of armed violence that plague the continent as well as the role of civil society.
3.1 Development Alternatives
The first section introduces alternative development strategies that originated in Latin America, from the Dependentistas in the 1960s and 1970s to the proponents of buen vivir under different guises. In an interview that sets the scene, Fernando Henrique Cardoso reflects on the seminal book he co-authored with Enzo Faletto in 1969 entitled Dependencia y desarrollo en América Latina (Dependency and Development in Latin America). Seen as a preliminary attempt to identify the consequences of globalisation for the global South, the book departed from the idea of a homogenous ‘periphery’, highlighting different forms of interrelations between developing countries and ‘the centre’. The diversity of development trajectories reflects the role of social and political actors in shaping development pathways in spite of structural constraints imposed by dependency relations. Fernando Henrique Cardoso notes that Latin American development strategies—even in countries that espoused economic orthodoxy—have been marked to some extent by a sense of urgency in addressing three woes that have long plagued the region: extreme poverty, high levels of inequality and weak democratic institutions. Turning to the experience of Brazil, former President Cardoso reflects on successes and failures, and discusses the increasingly important role played by emerging economies, including the brics, and the rise of Chinese investments in Latin America.
In Chapter 3 Antonio Hidalgo-Capitán and Ana Patricia Cubillo-Guevara explore the genealogy of the Latin American concept of buen vivir and its various intellectual offspring. The authors discuss how diverse versions of buen vivir are embedded in a variety of knowledge ecologies that have been
To what extent have alternative development pathways seemingly departed from the traditional forms of accumulation and negative development dynamics associated with the ‘resource curse’? Looking at Latin America as a whole, José Antonio Ocampo shows that, following a period of export diversification that started in the mid-1960s, commodity dependence intensified again during the latest commodity price boom. Based on an analysis of commodity price super-cycles, Ocampo argues that resource-rich countries in the region have not been able to capture the potential benefits associated with the latest price boom. Some of them suffered from the ‘Dutch Disease’ and other macroeconomic woes in the absence of appropriate countercyclical policies. The author notes that a lack of significant progress in economic diversification does not bode well in the face of a potentially prolonged phase of relatively weak commodity prices.
How can countries envisage moving beyond a (neo-) extractivist development pattern? For Alberto Acosta—who critically examines the notion of post-extractivism and the potential for its implementation—getting out of the extractivism trap requires overcoming ‘the religion of economic growth’. The author calls for the integration of the visions, values, experiences and knowledge ecologies embedded in various forms of buen vivir put forth and practiced by a variety of indigenous peoples in the Andean region and beyond.
3.2 Development Outcomes and External Influences
The second set of chapters in this issue focuses on the outcomes of different development strategies and on the influence of external actors on development in the lac region. The first two chapters discuss policies and outcomes in Andean countries. Both authors find that despite differing strategies and
Chapter 7 turns to the operationalisation of buen vivir in the context of a biodiversity project implemented in Bolivia. Frédérique Weyer reflects on the ‘Biocultura’ project carried out jointly by the Government of the Plurinational State of Bolivia and the Swiss Agency for Development and Cooperation (sdc). Her case study highlights both the difficulty and the feasibility of reconciling biodiversity conservation objectives with the task of raising incomes, promoting local knowledge, and strengthening policies and institutions that are consistent with the promotion of buen vivir.
In Chapter 8, Javier Herrera studies the extent to which the recent decade of robust economic growth in Peru and neighbouring countries translated into reductions in poverty and inequality, allowing for the middle classes to expand. Herrera finds that poverty and inequality rates declined to the same extent in countries that pursued policies that emphasised foreign direct investment and prudent fiscal and monetary policies (Chile, Colombia and Peru) and in other countries that emphasised resource nationalism and revenue redistribution. This does not mean that policy does not matter. Fiscal policies did play a role in reducing poverty and inequality in both groups of countries.
The next two contributions turn to external influences, looking at China and international financial institutions. Adriana Erthal Abdenur analyses Chinese foreign direct investments in the lac region with a focus on the extractive sector. Chinese investors have relied on a wide range of strategies to enter Latin American markets and secure access to oil, gas and minerals. Initially, they tended to favour mergers and acquisitions as well as joint ventures, before taking the greater risk of investing in greenfield or new extractive projects. For Abdenur, Chinese investors opted for a cautious approach that combined gradual institutional learning with a desire to reduce the risks of facing unrest and accusations of neo-colonialism. The second contribution addresses the complex interactions between lac countries and multilateral
3.3 Environmental and Social Dynamics
In the third and final section of this thematic issue, seven authors confront governance issues and policy options in relation to environmental and social dynamics. In their chapter on the evolution of mining legislation in Latin America, Ana Elizabeth Bastida and Luis Bustos focus on constitutional principles and legal frameworks applicable to the governance of natural resources and territories, in particular in the cases of Bolivia and Colombia. Their study underscores the necessity of filling legal and institutional design gaps to promote more sustainable natural resource management models. Darío Indalecio Restrepo Botero and Camilo Andrés Peña Galeano address the tensions between extractivism, decentralisation, protection of ethnic rights and the environment. Comparing Bolivia and Ecuador with Colombia and Peru, the authors find that the major ideological fissure—embedded in different constitutional and governance frameworks—between the two groups of countries has not translated into significant differences in terms of overall dependence on the extractive sector and of associated social and environmental problems. This raises again the question of the sequencing of a potential move towards post-extractivism.
Latin American and Caribbean societies are among the most violent worldwide. Robert Muggah explores the promise of ‘citizen security’ in this context. Beyond widespread legal impunity and social inequality, the high prevalence of homicides relates to overly repressive and punitive approaches to tackling criminality in the region. Muggah reviews recent home-grown ‘citizen security’ measures that include strategies to reform not only policing, but also the
Increasing civil society participation in public affairs is obviously not restricted to security issues. Ricardo Fuentes-Nieva and Gianandrea Nelli Feroci examine the evolution of social participation and activism in Latin America. In the context of a widening gap between institutionalised politics and the citizenry, traditional social movements are giving way to a new form of social activism that is not identified with well-defined centres of deliberation and coordination. But like lac’s former social movements, these new expressions of social activism are the product of enduring problems affecting Latin American societies: poverty and inequality associated with social and political exclusion. A topic deserving further research is how the civic space for contestation evolves in countries that spearhead alternative development strategies. How constrained is the civic space when the governing elite has recently emerged, and drawn legitimacy, from civil society movements?
4 To Conclude
As pointed out by Fernando Henrique Cardoso, leaders and policies matter a great deal for development, notwithstanding structural barriers and adverse power relations. In today’s multipolar world, Latin America can draw on a rich intellectual heritage and varied knowledge ecologies to imagine, formulate and implement novel approaches in the pursuit of sustainable development in all its four dimensions: economic, social, ecological and cultural. Courted by Western and Asian investors for their natural wealth, some Latin American countries have become important players in South–South cooperation and have acquired a greater voice when doing business with international financial institutions.
The latest commodity price boom resulted in a period of economic growth and poverty reduction. It provided the financial means to invest in essential public services, infrastructure, and social protection programmes. The end of the commodity price super-cycle puts some of these gains in jeopardy, raising anxiety among an emerging middle class wary of slipping back into poverty. In this context, several contributions in this volume acknowledge the mobilising force of alternative development narratives espoused by left-wing governments.
Paradigmatic innovations and development experiences in Latin America, and more specifically in the Andean region, offer a wealth of insights into the relationship between different knowledge ecologies, ideologies, development narratives, policies and practice. Certainly, it is not possible to cover in one volume all the relevant issues arising in Latin America. In the case of Argentina and Brazil, for example, further research would be required to explore the consequences of commodity-led development beyond the extractive sector, looking at the impact of the large-scale cultivation of genetically modified plants on land ownership, the environment, public health and poverty. It is nonetheless our conviction that the collection of chapters in this thematic issue will enrich the academic literature and policy debates on development processes in Latin America, and on what the rest of the world can learn from them.
ECLAC (Economic Commission for Latin America and the Caribbean) (2014a) América Latina y el Caribe en la agenda para el desarrollo después de 2015: reflexiones preliminares basadas en la trilogía de la igualdad LC/L.3843 (Santiago de Chile: ECLAC) http://www.cepal.org/publicaciones/xml/4/53214/ReflexionespreliminaresdelatrilogiaIgualdad.pdf(accessed on 6 March 2017).
SanahujaJ.A.S.TezanosA.Kern and D.Perrotta (2015) ‘Beyond 2015: Perspectives and Proposals for Development Cooperation between the European Union and Latin America and the Caribbean’ EU-LAC Forum of Global Governance European Union-Latin America and Caribbean Foundation (Hamburg: EU-LAC Foundation) DOI: .
Also referred to, in certain contexts, as vivir bien and translated into English as ‘Good Living’.
Only once the final statistics of the 60 indicators become available, which could take several more years, will the definitive results be clear.
For an overview of the Petrobras scandal, see Gallas (2015).
For an overview of the Odebrecht scandal, see ‘Bigger and oilier’ (The Economist, 2016).
Pachamama, often translated as Mother Earth, refers to a goddess worshipped by indigenous people in the Andes.