How did neoliberal economic policies spread through Latin America in the late 20th century?

Neoliberal economic policies spread through Latin America in the late 20th century primarily as a response to the severe debt crisis of the 1980s. As regional economies faced insolvency, hyperinflation, and the failure of previous import substitution strategies, governments turned to market-led reforms to stabilize their economies.123

The adoption of these policies was heavily promoted by international financial institutions, including the International Monetary Fund and the World Bank. These organizations attached "structural adjustment" conditions to loans, requiring countries to implement a standard package of reforms often referred to as the Washington Consensus. Key measures included:12

• Economic Stabilization: Controlling inflation and reducing government budget deficits through monetarist approaches, such as raising interest rates and cutting spending.13
• Market Liberalization: Reducing trade barriers, devaluing currencies, and removing state controls on imports and exports to integrate into the global economy.14
• Privatization: Selling state-owned enterprises to private investors and reducing the overall role of the state in the economy.143

While Chile served as an early model for these reforms under the Pinochet dictatorship, the approach was eventually adopted to varying degrees across the region, including through regional trade agreements like Mercosur and NAFTA.45