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Imbalanced growth

Imbalanced growth

As South America goes through a period of turmoil, protests across the continent rage due to extreme social inequality, leading to instability in the region. Ecuador and Chile have been rife with anti-government protests for the past two weeks, many of which have ended in violence. The demonstrations began after the Presidents in these country made economic announcements, following which, a massive public outcry was sparked. As matters have escalated, the watches how a wave of social protest has shaken all of Latin America. The social trends behind the protests are visible in other South American countries. Much like Argentine President Mauricio Macri, Ecuador's leader, Lenin Moreno, was forced to announce austerity measures which were later cancelled because of debt negotiations with the International Monetary Fund. Although protests in Chile see no rest despite reforms, and although Chile does not have any issues regarding debt, there are parallels to the situation in Ecuador and Argentina. With the impression of the world's most neoliberal country, Chile has every aspect of public life privatised, including pensions, health care, education and yet many Chileans striggle to make ends meet. This has been a core factor in protests there. The average middle-class citizen there earns about €700 ($778) a month, but cost of living prices are comparable to Berlin. As a matter of fact, Chile is posting good economic figures and poverty levels in Chile went down by three percentage points between 2016 and 2019. The same report, however, found that 1 per cent of the country's population owns 26.5 per cent of its wealth. Given this disparity between the have and the have-nots, the extreme inequality between rich and poor is a reality in many countries across Latin America. Although Chile is not the poorest region in the world, its inequality is said to be the world's most extreme—World Bank's GINI index, which tracks global wealth inequality confirms this. Protests have spilled over to other countries in the southern continent in a domino effect but the lesson that stands stark is that people are generally aware, and more aware of what they do not have that others do. The situation in South America is yet another example of how thriving economically is not sufficient for a stable state. Social equality is the backbone of a prospering country.

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