Pension reforms in Latin America started decades ago, when the Defined Benefit systems that prevailed globally began to show signs of unsustainability. The countries of the region began to reform their systems, towards defined contribution schemes that were more sustainable over time and resistant to demographic shift, reforms towards which some of the countries in the region are still transitioning.

Countries that began to implement individual capitalization systems earlier have benefited not only because of their robustness and greater sustainability, but also because they have fostered greater development of their financial markets and their economy, overall. However, they have also seen the negative effects that came with them, such as lower number of people able to obtain a pension, inadequate replacement rates and income inequality gaps, among others. Many of these phenomena were accentuated due to the COVID-19 pandemic.

The region struggles with limited coverage due to high levels of informality. This is the result of the systems’ design, heavily based on already existing ones and which were not adapted to the context of the region, nor did they foresee the movements of the labor market over time.

Employment in the region has had important changes due to various phenomena: demographic shift, the precariousness of formal employment given the popularization of outsourcing and the emergence of the gig economy, that overall makes it harder for workers to access contributory pension schemes and, over time, become a pensioner.

Recognizing these deficiencies, several Latin American governments have begun new reform processes that, in some cases, seek to change the rules of the contributory systems to increase the chances of obtaining a pension and to make it more adequate, as in the case of Mexico, and in other cases, rethinking the role of private industry and the state in the administration of pension savings, with the aim of meeting the demands of the people who reject the status quo of systems that have failed them, as is the case of Chile .

Something else that is important to highlight is the resurgence of social pensions throughout the region, which has seen an increase in support programs for the elderly, particularly since the COVID-19 pandemic. Programs vary from support for food and basic needs, to full implementation of universal pensions, which mainly favor people with lowest incomes or those who have never contributed to a contributory system.

In this section, we present you with a research collection of books, reports and papers, and the most relevant news on the latest reforms that have been implemented or are being discussed in countries of Latin America.

In this section, we present you with a research collection of books, reports and papers, and the most relevant news on the latest reforms that have been implemented or are being discussed in countries of Latin America.