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 Editorials | Issues | October 2006 
Latin America Faces Donation Crunch
 Mark Stevenson - Associated Press
| | Most Mexican corporations donate far less than 1 percent of their income to social projects, communities and charitable efforts, according to studies by the Center for Philanthropy. |
Latin America faces a dearth of charitable giving as international foundations look to needs elsewhere, while the region's own corporations are donating at rates well below those seen in the developed world, speakers at a regional conference of nongovernmental organizations said Monday.
“International foundations have changed their strategic focus and are supporting projects in Eastern Europe, Africa and Southeast Asia, reducing the support available for Latin America,” according to a statement by the 8th Ibero-American Conference of the Third Sector, a gathering of NGOs that opened Monday.
“At the same time, there hasn't been a corresponding rise in donors and foundations ... in our countries,” the statement continued. “Clearly, it is up to the inhabitants of the region to take on an equal share of responsibility.”
Latin America doesn't lack rich people or wealthy corporations. The problem, experts say, is that the region's new corporate giants are just coming to terms with their newfound power.
“It's not that there is a lack of good will, it's that it's been customary here to see social programs as the duty of the government. That was part of the culture,” said Manuel Arango, a businessman and founder of the Mexican Center for Philanthropy.
Whether it was the region's paternalist, “big” governments of the 1970s and '80s, or in past centuries, the Roman Catholic Church, “historically ... somebody has always been in charge of handling problems,” he said.
In the 1990s, however, there was a wave of privatizations and downsizing of many governments in the region, something that helped Latin American corporations grow, but left a hole in the public-service safety net that governments used to provide.
There is no doubt, speakers at the conference agreed, that corporations have to play a bigger role. Arango noted that only a few Mexican corporations donate even 1 percent of their pretax income, well below the average of about 3 percent in the United States.
Most Mexican corporations donate far less than 1 percent of their income to social projects, communities and charitable efforts, according to studies by the Center for Philanthropy.
And individual donors here have less incentive to make donations near the end of their lives. Because there is no inheritance tax in Mexico, they don't need to worry about piling up deductions for charitable gifts before they pass their money on to their children.
One example of large-scale giving is Mexican telecom magnate Carlos Slim, who told local media recently he is planning to give between US$2.5 billion (euro2 billion) and US$4 billion (euro3.2 billion) of his US$30 billion (euro24 billion) fortune to charitable foundations.
“It's an evolutionary process,” Arango said. “Fortunately, change is occurring, and quite rapidly.” |
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