Economics: Example Critical Thinking By An Expert Writer To Follow

Latin America came under colonization very early but gained independence early too. But the effect of inequality has continued. While Argentina, Uruguay, Chile and Cuba have had high exports per capita, it has been very low for some countries like Venezuela, Peru and Paraguay.
The region got integrated to global markets through trade in the 19th century and its share in global trade increased to almost 12% in mid twentieth century. However, since then it has come down to about 5-6%. There was an era of protectionism early on, but there was gradual shift towards industrialization and reliance on MNCs which meant that per capita GDP growth was very high during 1870 to 1945 period.
However, 1980s debt crisis resulted in marked shift in industrial and economic policies followed by the Latin American countries. A mixed model of export promotion and regional integration replaced import substitution. There was significant difference with respect to East Asia in terms of greater reliance on external borrowings and large gap between savings and investments. This resulted in greater economic inequality.
There was high growth in some export sectors, especially manufacturing exports, since 1950s resulting in diversification from traditional food and energy markets, which dominated the exports till that period. The market share of exports in world food and energy markets has come down since and currently stands at around 10%.
Debt crisis of 1980s was created due to large external borrowings creating external deficit but savings remaining subdued. This resulted in just over 1% growth during the 1980s decade, called the ‘Lost Decade’. The effect was the crisis of exacerbated by sharp drop in commodity prices and conditional financing by other countries.