a unified whole. This gives Latin America a particular capacity for action and negotiation that can be best used by setting joint and independent positions.

LATIN AMERICA AND THE CARIBBEAN IN THE WORLD ECONOMY

A notable feature in the development of the world economy is the persistent inequality of the Latin American and Caribbean countries’ economic weight. The gross domestic product of the United States, the Soviet Union, or Japan is 1,000 times larger than those of the small countries of the world, and up to 10,000 times larger than those of the smallest national economies. The countries of Latin America and the Caribbean, except for Brazil and Mexico, are in the group that is 100, 1,000, or up to 10,000 times smaller than the superpowers (Table 1).

The economic weight of all developing countries, Latin American and Caribbean countries in particular, has hardly increased at all in the last quarter century. From 1960 to 1982 Latin America’s share of world production rose from 4.2 to 5.3 percent (Table 2). This increase was mainly due to Brazil and Mexico, whose share of world production rose from 1.1 to 1.8 percent and from 0.9 to 1.3 percent, respectively.1 Most of the other countries in the region experienced only slight increases or declines in their share of world production.

The relative weights of the market economy in developed countries and in countries with centrally planned economies have remained virtually unchanged since 1960. However, changes within each group have significantly affected the international economic and political situation. At the same time that the U.S. share dropped between 1960 and 1982 from 36 to 26 percent, Japan’s share rose from 3 to 9 percent (Table 3). The change was even more dramatic in their relative power positions in the international economy. For 1985, Japan’s exports totaled $174 billion and U.S. exports totaled $217 billion. But Japan showed a net foreign investment of $125 billion, whereas the United States recorded a net foreign debt of $107 billion (Brown et al., 1986; World Bank, 1986). Consequently, Japan’s external economic position, measured only with these partial indicators, appears better than that of the United States.

Japan’s economic power is supported by the combination of a high propensity to save and invest domestically, low military expenditures (1 percent or less of gross domestic product), and an orientation toward building a large

1  

For further information see Yearbook of National Accounts Statistics for 1976, Volume II, International Tables, United Nations, New York, 1976; National Accounts Statistics: Analysis of Main Aggregate, 1982, United Nations, New York, 1985; Statistical Bulletin, January-December 1985, Organization of American States, Washington, D.C.; and Brown et al. (1986).



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