The Current Setting
LATIN AMERICAN ECONOMIES, although far from stagnating, did not grow fast enough during the 1960s to alleviate the area's grave economic and social problems. Severe underemployment and unemployment, exacerbated by a rapid population increase, may turn into an unsustainable burden unless the region's economic development can be significantly accelerated. But the promise of the first years of the last decade--the Alliance for Progress, and U.S. aid--has withered. The movement toward economic integration has lost its early, slight strength. Neomercantilist tendencies have emerged in developed countries to bolster traditional restraints against exports, actual and potential, from low-income countries.
The forces for change released in the aftermath of the Second World War profoundly affected the poverty-ridden two-thirds of the world's population. As regional isolation ended, awareness of the vast gaps in income levels between the rich and the poor countries grew. The United States interest in the economic development of low-income countries in that period gave rise to aid programs, which became an important instrument of U.S. foreign policy. Those efforts declined during the second half of the 1960s, however, as the disappointing short-term results of foreign