The Poorest Countries In South America

South America and Economic Rankings 

South America is a land mass located in the Western Hemisphere, which includes a total of twelve independent countries and three dependent territories. It is the fourth largest continent in terms of area, after Asia, Africa and Europe. South America has a population of around 425 million people as of 2020, making it the third most populous continent after Asia and Africa. This region has experienced tremendous economic growth over the past two decades but there is still a wide disparity in the level of economic development and average income earned among its countries. 

This article will focus on the poorest countries in South America and will provide an in-depth look at the ranking of the 10 poorest countries in the region.

Gini Coefficient and GDP per Capita 

The Gini coefficient is a statistical measure that is used to measure income inequality. A score of 0 means that income is perfectly equal; a score of 100 means that income is highly unequal. South America has a Gini coefficient of 48.8, which is higher than the world average of 38.44. The continent’s average GDP per capita is $10,015, with the highest being Argentina ($21,728) and the lowest being Bolivia ($3,785).

The 10 Poorest Countries in South America

  1. Bolivia: Bolivia is the poorest country in South America and one of the poorest countries in the world with a GDP per capita of just $3, 785. The country’s economic problems can mainly be attributed to poor economic policies and a lack of government investment in the country’s infrastructure and resources. Poverty is rampant in Bolivia, with around 37% of the population living below the poverty line.

  2. Venezuela: Venezuela is the second poorest country in South America with a GDP per capita of just $4,201 and an alarming 66% poverty rate. The country has been in a state of economic turmoil since the late 2000s, with hyperinflation, shortages of basic goods and services, and an exodus of citizens fleeing the country.

  3. Haiti: Haiti is the third poorest country in South America with a GDP per capita of $4,308 and over 50% of the population living in extreme poverty. Political instability and corruption have plagued the country for decades, leading to one of the lowest HDI scores in the region.

  4. Guyana: Guyana is ranked as the fourth poorest country in South America with a GDP per capita of $4,446 and around 27% of the population living in poverty. The economy is largely dependent on the export of natural resources, especially bauxite and gold, though these revenues are not enough to help alleviate the country’s economic woes.

  5. Nicaragua: Nicaragua is the fifth poorest country in South America with a GDP per capita of $4,647 and a poverty rate of 44.3%. The economy is largely reliant on remittances from abroad, though the financial downturn in Central America has caused a decline in these revenues.

  6. Paraguay: Paraguay is ranked as the sixth poorest country in South America with a GDP per capita of $4,859 and a poverty rate of 21.4%. The country’s economy is largely based on exports of agricultural products such as soybeans, cotton, livestock and timber.

  7. Ecuador: Ecuador is the seventh poorest country in South America with a GDP per capita of $5,039 and a poverty rate of 28.5%. The country’s economy relies heavily on oil exports, though a decline in global oil prices has caused significant economic hardship.

  8. El Salvador: El Salvador is the eighth poorest country in South America with a GDP per capita of $5,088 and a poverty rate of 35.8%. The government has implemented economic reforms in recent years in order to try and reduce poverty, including introducing new taxes and encouraging private investment.

  9. Peru: Peru is the ninth poorest country in South America with a GDP per capita of $5,269 and a poverty rate of 19.7%. The economy is largely driven by exports of mineral and petroleum products, though poverty remains a major challenge in the country.

  10. Colombia: Colombia is the tenth poorest country in South America with a GDP per capita of $7,515 and a poverty rate of 19.3%. The country has made great strides in terms of economic growth in recent years due to the implementation of reforms and better financial management.

Factors Affecting South American Economic Growth 

There are many factors that have contributed to the wide variations in economic growth between countries in South America. Poor government policies, inadequate infrastructure, and a lack of investment in education and healthcare are all major contributing factors to the low levels of economic development in many of these countries. In addition to this, political instability, crime and corruption have had a major impact on their economic performance.

South America has experienced tremendous economic growth over the past two decades, but the region remains divided in terms of the level of economic development between its countries. Bolivia is the poorest country in South America, followed by Venezuela, Haiti, Guyana, Nicaragua and Paraguay. Factors such as poor governance, inadequate infrastructure and a lack of investment in education and healthcare have contributed to continued poverty and inequality in the region. It is necessary for these countries to create better policies, reduce corruption and invest in the development of their resources in order to ensure continued economic growth and reduce inequality.

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