Which Is the Most Developed Country in Latin America and Why?

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Which is the most developed country in Latin America and why?

As the HDI studies the four principal areas of examination that are used to rank countries: mean years of schooling, expected years of schooling, life expectancy at birth and gross national income per capita, we can see that, for example, in Argentina goes up to 0.83 and in Chile 0.82 and in Uruguay 0.79, showing that there is almost no difference in these elements named before, but the real difference is that Chile has almost 18 million population and Argentina has 44.3 million, even if the percentage is based on population. This makes us see that Chile is being more efficient because with less than a half of population than Argentina, they managed to be in the top of the list of the HDI in Latin America and above from many countries around the world. Also, they are above every country in Latin America in Life expectancy, with 78.44 and being 51 in the world rank. This means that the healthcare, medicine and life quality should be better in Chile than in any other Latin American countries, or at least in the same level of some of them that have almost the same life expectancy rate, like Argentina with 77.51 and Costa Rica and Cuba with 78.23.

A key point in this is that close ties between Chile and USA. Many economic and state-related policies have been applied directly from the US model which, combined with Chile’s disciplined and less corrupt culture, has definitely worked out well. This is something Chile stands out for in Latin America.

The educational program shows that Uruguay has the most percentage of people finishing the primary school in LATAM with a 103% approximately, but Chile, Colombia, Costa Rica and Argentina are below by a small percentage (between 97% and 102%), so there is no reason to say that they are not advanced in the education system.

Another thing to analyze is the GDP. Chile has a GDP of 247 thousand million dollars, while Argentina 545 thousand million dollars, Colombia 282 thousand million dollars and Uruguay 52 thousand million dollars. These numbers must be related to the population in each country so, if we compare these Latin American countries, Chile and Uruguay should be the best when comparing GDP, because Chile has almost 18 million people and Uruguay 3.4 million.

According to the World Bank, Uruguay leads the Latin American countries ranking with a GDP per capita of US$15,220, but Chile doesn’t step back because they have a GDP per capita of US$13,792 and followed by Argentina with US$12,449. But talking about Purchase Price Parity, Chile has a PPP of US$23.950 at the end of 2016, leading the Latin American ranking of PPP and Uruguay with US$21.570, leading second and being followed by Argentina with US$20.170. This means that Chile is not far from getting the incomes of a developed country, but still something is missing to reach that. But everything tells that Chile is on the way of being developed very soon. As an extra data, the GDP savings of Chile are the highest of the LATAM countries with 22.43% of the GDP, and this is because during the government of Augusto Pinochet in 1973-1990, they started saving the countries money for future problems and in case of any crisis, which it has helped a lot, for example, in the 2009 crisis. Peru is following Chile in this with 21.76% and then Uruguay with 19.87%.

The Gini coefficient is something very relevant when comparing countries because it is a measure of statistical dispersion intended to represent the income or wealth distribution of a nation's residents, and is the most commonly used measure of inequality. The closest to the 0 is the more equal the country is in term of income of each person. Comparing, Chile has a Gini coefficient of 50.45, being very unequal among the countries in LATAM. To affirm that, the Gini of Uruguay is 41.87, in Argentina 42.28 and in Brazil 52.87. This means that Uruguay is leading this ranking, something that could put it one step forward from Chile in this “more developed country in LATAM”, but there is still more to compare.

As we can see, Uruguay has the smallest % of population below the poverty line when comparing people whose income is below that $3.10 (1.7%) a day and $1.90 (0.4) a day. Chile follows Uruguay not too far with 2.9% with $3.10 a day and 1.3% with $1.90 a day. Costa Rica and Argentina also have low percentages going below Chile and Uruguay, but the rest of the Latin American countries seem to be very far from breaking the poverty line.

The World Bank data at the end of 2016 shows that Bolivia has a 3.71% of unemployment rate being one of the countries with less unemployment in LATAM, followed by Peru with 4.95%, Paraguay (5.44%), Panamá (5.82%), Argentina (6.56%), Chile (6.57%), Venezuela (6.9%), Uruguay (8.15%) and at the end, Colombia with 9.87%. These low percentages don’t really mean that is something good, because sometimes, if the unemployment is really low, the payment or salary could be low as well, and as we can see, Bolivia has a very low unemployment rate with Peru, but their GDP is US$2460 and US$6100 respectively. Having said this, Chile, Argentina, Panamá and Uruguay aren’t in the best position, but it doesn’t mean that the unemployment in these countries is something that could make the country stay as a non-developed country.

Chile is "Highly Competitive". According to the World Economic Forum, Chile is the most competitive economy in Latin America. Also, it has the highest ranked institutions, infrastructure, macroeconomic environment, market efficiency, and correct technology array in Latin America. The economy has grown, on average, 5.5% every year from 1985-2009, not only the highest growth rate in Latin America, but also one of the highest growth rates worldwide

Chile has more than 20 Trade Agreements with 57 countries in the world, which represent 90% of the world's GDP. This country has one of the lowest corporate tax rates in the world at 17%. Also, it has agreements with 22 countries that avoid double taxation. According to the Perceived Corruption Index, Chile is 21st in the world and 1st in Latin America.

So, in conclusion, while there is not really an exact definition of when a country is considered developed, considering the advances in GDP per capita, HDI, life expectancy, literate rate and so on, the answer should be Chile. There is still an important reliance on commodities such as copper to fuel part of its growth, but in general Chile economy seems strong enough and has a positive future. Historically it was Argentina the country that led the pack. Other countries that seem to go in the right path to eventually reach that status