Governments in Latin America and the Caribbean are confronting significant development challenges, such as insufficient economic growth, inflation, and institutional weaknesses. Addressing these issues requires identifying systemic obstacles through data-driven diagnostics and equipping public officials with the skills to implement effective solutions.
While public administrations in the region often have access to valuable data, they frequently fall short in analyzing it to inform decisions. The inefficiencies in procurement, misdirected transfers, and poorly managed human resources result in an estimated waste of 4% of GDP, equivalent to 17% of all public spending.
The report titled "Data for Better Governance: Building Government Analytical Ecosystems in Latin America and the Caribbean" provides a roadmap for developing government analytics. It focuses on key enablers such as data infrastructure and analytical capacity while offering actionable strategies for improvement.
One of the key messages is to expand the use of government analytics in Latin America and the Caribbean. Public administrations predominantly use data mainly to produce descriptive analyses for operational and transactional purposes. This approach misses opportunities to leverage advanced analytics for decision-making and better public policy design.
The region is recognized as a global leader in adopting management information systems (MIS). By 2022, every country had both a Public Finance Management Information System and a Tax Management Information System. Additionally, 91% had a Human Resources Management Information System, and 84% had an e-Procurement system. These systems generate vast reservoirs of administrative data with significant untapped potential; however, 96% of MIS are used exclusively for descriptive analytics across all surveyed government functions.
Advanced analytics can transform public sector performance. For example, Ecuador and Peru increased tax revenues significantly through transactional data analysis, while Guatemala reduced school dropout rates by 9% using student data analytics.
Another focus is creating conditions for effective government analysis. To fully harness the power of analytics, governments must complete digitalization of their management information systems. Two-thirds of experts surveyed report that these systems remain partially digitalized, limiting their effectiveness.
Mechanisms ensuring data quality and integration are essential; yet according to the World Bank's GovTech Maturity Index only 25% of countries have implemented a data quality framework. Without these controls teams perform their own quality checks creating inefficiencies compromising accuracy.
Integrating data analysis into decision-making processes is crucial as well. Analytics should complement policymaking rather than replace it; building officials' capacity interpreting acting on evidence is essential effective governance requires prioritizing attracting retaining skilled analysts however only 12% offer dedicated career paths professionals possess needed revolutionize management now time capitalize potential strengthening capabilities integrating insights fostering culture evidence-based governance