BETTER TOGETHER

Mexico 2018 | ECONOMY | INTERVIEW

TBY talks to Emilio Uquillas, Country Representative of the Development Bank of Latin America (CAF), on improving the quality of life of vulnerable populations, promoting sustainable development in Mexico, and cooperating regionally to tackle climate change.

Emilio Uquillas
BIOGRAPHY
An Ecuadorian national, Emilio Uquillas was appointed Country Representative of CAF in Mexico in 2017. He previously held the same position in Bolivia for nine years. Before joining CAF, he held several positions in the Central Bank of Ecuador. Uquillas holds a master’s degree in economics from ITAM.

What challenges does Mexico face in terms of development?

Mexico is one of the most developed countries in Latin America. However, there are some challenges to be addressed. According to UN reports, Chiapas, for example, has a Human Development Index 20% lower than Mexico City. Development banks like CAF are here to help reduce this gap. We need to provide the best tools and knowledge our countries have in order to overcome poverty and inequality. Mexico has improved significantly in this area, though there still is plenty of work to be done.

What policies does CAF support to reduce income inequality in the country?

Mexico, in terms of public policy, has created an adequate framework to increase private investment, which has been a powerful tool to fight poverty considering the sustainable income-generation activities developed, which reduce the dependence on public expenditure. It is something like a public-private alliance against poverty. Although rural issues are no less important, with a large urbanization rate (80% by 2015) Latin America has become the region with the highest urban growth in the world where exclusion, low productivity, and climate change coexist and are deepening inequalities. In this light, one of our priorities is to contribute with the countries to build the best answers to solve the urban deficiencies. We work with the “Cities with Future” initiative, where CAF accentuates the need to focus on vulnerable populations' quality of life regarding access to services and infrastructure improvement with a focus on resilience. This approach can be of great impact for Mexico.

How does CAF support the country's productive sector?

Our focus has been on transitioning from macroeconomic issues to microeconomic aspects because macro stability is not a sufficient condition to reach sustainable growth. Currently, one of the important challenges for Latin America is something we have called productive transformation, similar to certain Asian countries where development took a radical turn by improving productivity. Considering that a key factor was the transformation of educational levels and human talent, CAF promoted the improvement in skills for work as a source of long-term change. We promote working skills reinforcement in young people to assure them better conditions and opportunities to access the labor market and improve the economy's competitiveness. Our mission is to promote regional integration and sustainable development. We could encourage deeper integration between Mexico and South America while stimulating productive transformation. Given our experience in the region, there are clear opportunities for Mexico in the economies of the south.

How do Mexican cities fare in terms of climate change adaptation compared to the rest of the region?

In the Paris Agreement, countries adopted several measures to fight climate change. Mexico has significantly advanced regarding its policy commitments to reduce its greenhouse gas emissions. Mexico's approach is transversal and comprehensive, including all stakeholders and factors. Environmental policies are not only about climate behavior and conservation; they are embedded in all economic, productive, and social areas. It is a cross-cutting issue that must be taken into account when designing educational, health, industrial, and transportation policies. The environment is no longer an important issue; it is a vital one. The Latin American region needs to generate a regional, organic, and comprehensive approach to manage environmental concerns.

How does CAF support the government to upgrade its water infrastructure and improve water governance?

In general terms, water is one of the most critical and important issues amongst CAF programs. We are part of the Global Water Council and recognize there are many challenges regarding water. Water governance must be included in all development agendas. Mexico does have a shortage of water resources; however, we are on time to generate a national water governance program of which we are keen to be a part. Both the public and private sectors must cooperate in order to reach sustainable water usage.