Context
- except for during Great Depression of 1930s, most Latin American nations experienced economic growth between 1900 to 1960s
- economies tied into global economic order, dependent on industrial world
- many relied on export of single crop/commodity, struggling when harvests failed or demands declined
- by 1960s, faced increased competition from emerging nations also seeking to export crops and commodities
Economic Nationalism
- to reduce dependence on imported goods, governments set up own industries in 1940s
- under policy of import substitution, local manufacturers encouraged to produce goods
- efforts to promote industry had mixed success
- middle class prospered, but life didn’t improve for most people
- new industries were inefficient and needed government help or foreign capital
- products were expensive or poorly made
- not enough expansion for new jobs for rapidly growing population
- results: eventual return to promotion of agricultural exports
Expanding Agriculture
- in past 50 years, large amount of land opened for farming
- best farmland belonging to businesses or large commercial farms
- modern technology used to develop land and create food-processing plants
- cost of environmental damage — ex. Amazon Rainforest destruction
- commercial agriculture changed food habits
- ex. hamburgers instead of tortillas
- traditional foods no longer grown
- crops for export grown
- result: more food needed to be imported at higher costs
- 1980s, higher oil costs, interest rates, recession hurt L.A. nations
- esp. for those that borrowed money to develop industry —> interest rates
- economic reforms resulted to mitigate debt:
- lower spending on social programs
- prices on goods
- lower investment in local businesses
- foreign investment
- 1990s, economic growth rising again
- living standards dropped despite this
- foreign investments brought new business but kept cheap labor for profit