São Paulo hosts the 13th World Economic Forum on Latin America

The 13th annual Latin America edition of the World Economic Forum (WEF), dubbed a “Mini Davos,” began yesterday in São Paulo. With three-quarters of Latin America due to face elections during 2018, the conference’s theme this year was how nations could create new narratives as they face a “tipping point.”

“Latin America is initiating a decisive electoral cycle, which represents an opportunity to embrace technology and innovation while promoting long-term value creation, fostering economic progress in a sustainable manner,” said Marissol Argueta de Barillas, director of the World Economic Forum onLatin America.

</p> <p>Topics on the forum’s table include corruption, fake news, cybersecurity and sexual harassment. Additionally, several panels focus on business and economic issues that could be fundamental for the 750 regional leaders in attendance: Industry 4.0, <a href="https://brazilian.report/2018/01/17/fintech-bank-concentration/">blockchain</a>, globalization and agricultural innovation.</p> <p>President Michel Temer opened the conference alongside Barillas, in addition to State Secretary Geraldo Alckmin, city mayor <a href="https://exame.abril.com.br/economia/temer-alckmin-e-doria-listam-prioridades-no-forum-economico/">João Doria</a> and footballing legend <a href="https://www.foxsports.com/soccer/story/pele-uses-walker-at-world-economic-forum-event-031418">Pelé</a>. Temer used his opening address to speak out against US President Trump’s proposed tax on steel and aluminum. “We stand against protectionist measures. We are actually in favor of fully opening our markets, and we are also looking for full openness from foreign markets vis-à-vis Brazil,” he said.</p> <p>Alckmin also took the opportunity to call for fewer protectionist policies, but focused his speech on Brazil’s recent progress. “Brazil is leaving a recession and beginning a process of economic recovery that should be more vigorous this year, with this we have many challenges,” he said. “We have the challenge of income inequality, economic openness, and security. Latin American integration is important.”</p> <h3>Rising investments</h3> <p>Speaking alongside Temer and Alckmin, Doria was quick to portray Latin America as readily open for investors. “With the resumption of growth, Brazil can support the expansion of the regional economy,” he said.</p> <p>International investment in the region has indeed increased, with foreign venture capital more than doubling since 2013. In 2016 alone, an all-time high of 197 venture capital deals took place in Latin America. Brazil did particularly well from these, becoming the largest venture capital market in terms of investments that year and accounting for 56 percent of the regional total.</p> <p>Brazil’s most significant investments – including potentially the largest investment in the region – were based in fintech and healthcare. Nubank closed a deal worth $80 million in December 2016, while GuiaBolso also finalized a $17 million deal in May.</p> <p>Meanwhile, Dr. Consulta closed a $26 million deal in March, and Adavium Medical’s April deal came to$21 million. Other big deals in the same year included a $19 million deal with advertising and marketing firm Resultados Digitais, and a $10 million deal with logistics firm CargoX.</p> <p>Patterns in Brazil and in Latin America fit with the IMF’s global economic outlook, which predicts a steady 3.7 percent output for 2017, 0.5 percent higher than the previous year. Meirelles, also a speaker at the forum, issued similar messages to those of the IMF, warning of increases in interest and inflation rates if economies grow too fast.</p> <h3>Paths to Latin America’s economic growth</h3> <p>For Hans-Paul Bürkner, chairman of Boston Consulting Group, the future of employment involves greater levels of automation. However, he remained optimistic about the impact of automation on employment.</p> <p>“In many places, we will run out of people before we run out of jobs,” he told the audience, citing aging populations leading to stagnation in East Asian, North American and European nations. “Rather than saying everything will be done by machines, there are so many things especially where young people can also create opportunities, through education, training, getting jobs.”</p> <p>However, a persistent skills gap in the region was also a cause for concern among many speakers. “One policy which stands out is skills. I’m generally optimistic. Here in skills, I think we should be worried about the state in Latin America,” said Angel Melguizo, head of the OECD’s Latin America and Caribbean unit. “Two out of three firms in Latin America say ‘we have a project, we have vacancies, but we don’t find workers with the skills that are needed.’”</p> <p>Research made by the World Economic Forum shows that as a region, Latin America has the widest skills gap in the world. Four out of ten firms struggle to find skilled hires, following historic patterns that remained even during the region’s economic boom in the 2000s.</p> <p>Forum speakers placed education as one of the key tools to address the skills gap. According to World Trade Organization’s director-general Roberto Azevêdo, some studies demonstrate that children under the age of 12 will face a radically different scenario in terms of skills needed in future jobs.</p> <p>“Two-thirds will end up working in jobs that don&#8217;t exist right now,” he said. “Overall, economies are creating more jobs than ever before, but we need a different set of skills and expertise. This change will happen extremely quickly.”</p> <p>But technology isn’t the only thing that could revolutionize labor markets and economies across the region. Richard Amaral, vice-president of Brazilian firm Global Money Transfer, told the audience that gender parity is one way for companies to prosper.</p> <p>“Research efforts say that companies that enjoy diversity &#8211; gender diversity or nationality diversity –have a 35 percent better performance than companies within the same sector, same industry, by comparison with the average,” he said. “So those are points that we do have to address.”

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BY Ciara Long

Based in Rio de Janeiro, Ciara focuses on covering human rights, culture, and politics.