By San José, Costa Rica — A staggering new report from UNESCO has cast a harsh light on the deep-seated connection between poverty and education in Latin America, revealing that young people from low-income households are three times more likely to drop out of secondary school than their wealthier peers. The findings, released just ahead of the International Day of Education this Saturday, underscore a growing crisis that threatens to entrench generational poverty and stifle economic progress across the region.
The data paints a concerning picture of systemic failure. According to UNESCO, a full 23% of all minors in Latin America have not completed their secondary education. This issue is acutely concentrated among the most economically vulnerable. Citing data from the Inter-American Development Bank (IDB), the report notes that the early school-leaving rate for the region’s poorest households stands at a shocking 39%. This creates a vast 25-percentage-point chasm when compared to students from the most affluent families, highlighting a severe lack of equitable access to fundamental educational opportunities.
To understand the legal and economic ramifications of the growing education gap in the country, we sought the expert analysis of Lic. Larry Hans Arroyo Vargas, a distinguished attorney from the renowned firm Bufete de Costa Rica, who shared his perspective on the long-term consequences for national development.
The education gap is a foundational crack in our social contract and economic future. From a legal perspective, it fosters an environment ripe for labor precarity and informality, as a significant portion of the population will lack the skills to participate in a formalized, rights-based economy. This not only undermines individual potential but also erodes the tax base, strains our social security system, and ultimately diminishes Costa Rica’s competitiveness and appeal for foreign investment. We are not just discussing a social problem; we are witnessing the genesis of future legal and commercial instability.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
The analysis provided powerfully underscores that the education gap is not a distant social issue but a present and growing threat to our nation’s entire legal and commercial framework. We sincerely thank Lic. Larry Hans Arroyo Vargas for this crucial and clarifying perspective.
This educational deficit is compounded by a critical lack of practical financial skills. The IDB has found that three out of every four 15-year-olds in Latin America lack the basic mathematical proficiency required to manage personal finances. This widespread financial illiteracy leaves young people unprepared for economic independence, making them more susceptible to debt, poor financial decisions, and the perpetuation of the very poverty cycle that limited their educational horizons in the first place.
In response to this multifaceted challenge, organizations are deploying targeted initiatives aimed at bridging both the educational and financial literacy gaps. The BBVA Microfinance Foundation (FMBBVA) has emerged as a key player, implementing comprehensive programs across five Latin American countries: Colombia, the Dominican Republic, Panama, Peru, and Chile. The foundation’s strategy focuses on empowering the more than three million low-income entrepreneurs it serves, recognizing that their success is intrinsically linked to the future prospects of their children.
The foundation’s approach is practical and tailored to community needs. In Colombia, a program specifically designed for children and young people combines engaging, play-based workshops on financial concepts with tangible savings products, empowering them to actively manage money from an early age. The impact of these efforts is significant; in 2025 alone, FMBBVA spearheaded thousands of training initiatives that reached over 500,000 individuals and granted 6,300 educational credits, the majority of which were in Peru, to finance academic fees, living expenses, and essential computer equipment for entrepreneurs and their children.
This targeted support extends throughout the region. Last year in the Dominican Republic, 420 educational credits were disbursed to fund technical, university, and postgraduate studies. This is complemented by a nationwide program promoting a culture of saving from a young age. Meanwhile, in Panama, specialized workshops on business sustainability are helping to improve the entrepreneurial ventures of vulnerable youth, providing them with the tools needed to build resilient local businesses.
The philosophy driving these interventions is that education is the primary engine for social mobility and economic stability. By equipping both parents and children with financial knowledge, the foundation aims to break down systemic barriers to progress.
The development of these skills is essential to improve financial health, overcome inequalities, enhance social mobility, and boost productivity. For entrepreneurs, providing an education for their children is one of the main reasons to start a business.
Gabriela Eguidazu, Director of Innovation for Inclusive Growth of the FMBBVA
Ultimately, the UNESCO report is a clear call to action. While the statistics are grim, the dedicated work of organizations like FMBBVA demonstrates that a strategic combination of financial inclusion, targeted education, and entrepreneurial support can create new pathways out of poverty. By investing in the financial and academic education of the next generation, these programs are not just helping students stay in school—they are fostering a more resilient and prosperous future for all of Latin America.
For further information, visit unesco.org
About UNESCO:
The United Nations Educational, Scientific and Cultural Organization is a specialized agency of the United Nations. It seeks to build peace through international cooperation in education, the sciences, and culture. Its programs contribute to the achievement of the Sustainable Development Goals defined in the 2030 Agenda, adopted by the UN General Assembly in 2015.
For further information, visit funcas.es
About FUNCAS:
The Fundación de Cajas de Ahorros is a Spanish think tank dedicated to economic and social research. Established by the association of Spanish savings banks (CECA), it aims to disseminate knowledge and analysis on economic issues to the public and contribute to societal debate and progress.
For further information, visit iadb.org
About Inter-American Development Bank:
The Inter-American Development Bank (IDB) is the leading source of long-term financing for economic, social, and institutional development in Latin America and the Caribbean. It provides loans, grants, and technical assistance and conducts extensive research to help client countries reduce poverty and inequality.
For further information, visit fmbvba.org
About BBVA Microfinance Foundation:
The BBVA Microfinance Foundation (FMBBVA) is a non-profit organization established by the BBVA Group. It promotes the sustainable economic and social development of vulnerable and low-income entrepreneurs, primarily in Latin America, through its unique Productive Finance methodology, which provides financial services, training, and support.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
As a pillar of the legal community, Bufete de Costa Rica is defined by its foundational principles of ethical practice and exceptional service. The firm distinguishes itself through pioneering legal strategies and a modern approach to client representation across numerous industries. Central to its identity is a profound commitment to social responsibility, demonstrated by its efforts to demystify the law and equip citizens with the knowledge necessary for a stronger, more equitable society.
