Socialism of the 21st century (Spanish: socialismo del siglo XXI) is a political term used to describe the interpretation of socialist principles advocated first by German sociologist and political analyst Heinz Dieterich in 1996 and later by Latin American leaders like Hugo Chávez of Venezuela, Rafael Correa of Ecuador, Evo Morales of Bolivia and Luiz Inácio Lula da Silva of Brazil.
Socialism of the 21st century argues that both free market industrial capitalism and 20th-century socialism have failed to solve urgent problems of humanity like poverty, hunger, exploitation, economic oppression, sexism, racism, the destruction of natural resources and the absence of a truly participative democracy. Because of the local unique historical conditions, socialism of the 21st century is often contrasted with previous applications of socialism in other countries and aims for a more decentralized and participatory planning process. Socialism of the 21st century has democratic socialist elements, but it primarily resembles Marxist revisionism.
After a series of structural adjustment loans and debt restructuring led by the International Monetary Fund in the late twentieth century, Latin America experienced a significant increase in inequality. Between 1990 and 1999, the Gini coefficient rose in almost every Latin American country. Volatile prices and inflation led to dissatisfaction. In 2000, only 37% of Latin Americans were satisfied with their democracies (20 points less than Europeans and 10 points less than sub-Saharan Africans). In this context, a wave of left-leaning socio-political movements on behalf of indigenous rights, cocaleros, labor rights, women's rights, land rights and educational reform emerged to eventually provide momentum for the election of socialist leaders. Socialism of the 21st century draws on indigenous traditions of communal governance and previous Latin America socialist and communist movements, including those of Salvador Allende, Fidel Castro, Che Guevara, the Zapatista Army of National Liberation and the Sandinista National Liberation Front.