The countries of Latin America faced neoliberal reform policies during the 90s; this stage appeared to bring challenges and transformations to the economic structure of the states. The introduction of neoliberal policies influenced the market supremacy and the economical role of the State; it is necessary to underline the fact that neoliberalism was the part of significant macroeconomic indexes effects leading to financial crisis and failure in welfare improvement and wealth fair distribution.
Neoliberal policies produced negative effects on the regulation of two basic problems of Latin American countries connected with political and economical atmospheres and policies. It should be stressed that neoliberal reforms were considered the basic culprit for economic failure and democratic deficit. The analysis of this system development should be based on the identification of main reason for its introduction; neoliberalism was aimed at improving market system and reaching constant economical development of industrialized countries. The liberalistic way has been practiced for decades in western industrialized countries involving developed states in open competition. Rapid decline of structuralism in the countries of Latin America resulted in the introduction of neoliberalism as the only chance to become the part of integrated world market. (Boyd, n.d.)
Neoliberal failures in Latin American countries were connected with the following factors: export possibilities problems, political instability, and insufficient market-ruled competition. Governmental problems were connected with the necessity to regulated laws and create appropriate conditions for developed markets, as well as there was demand for administration’s functioning and support providing for economists’ inventory. Neoliberal reforms resulted in mismatch between exported raw materials and imported produced goods, through the low value-adding of raw materials. It is necessary to stress that negative balance between imports and export-led to hopeless struggle aimed at debt crisis overcome. In accordance with neoliberal concepts, political strategies were to be directed at the creation of a network society, which was impossible because of private associations’ absence. Besides, the atmosphere of market-ruled competition was considered to be the background of poverty and unemployment raise within Latin American countries. So, neoliberalism appeared to be the key cause for current problems in Latin America having the atmosphere of social, political and economical instability.
Structuralism and Neoliberalism motives appeared to interact in current Latin American atmosphere of political and economical development. The failure of neoliberalism strategies proved the ineffectiveness of its introduction in the industrial countries of Latin America; though there is a positive moment in neoliberal policies. The reforms development led to the social movements’ promotion which provided the nations with their rights securing at the beginning of 1990s (Neumeier, 1999).
It is difficult to identify the reason for neoliberalism’s failure in the countries of Latin America, as it was aimed at economical improvement and welfare promotion. The central problem was connected with the necessity in independent economy and administration providing; Neoliberalism concepts being based on constant market growth suppressed the production extension running. Political struggle as a part of neoliberal concepts produced negative effects of free form competition (Neumeier, 1999).
- Boyd, A. (n.d.) Neoliberalism as Culprit of Latin America’s Failure. Web.
- Neumeier, A. (1999). Sense and Nonsense of the Neoliberalism Concept in Latin America.