After enjoying high rates of economic growth from 2004 to 2013, with reduced poverty, rising incomes, and a growing middle class, currently, with lower external demand, most countries in Latin America are confronting a sharp economic deceleration. This document shows that little was done during the good years to implement difficult—but necessary—structural reforms to remove the real obstacles that have limited productivity growth and thwarted convergence with more advanced economies. Moreover, on average, economic freedom—as measured by the Index of Economic Freedom—has been continuously declining in the region during the bonanza years. We make a connection between these two facts, arguing that since the principles of well-functioning free-market democracies are the basis for structural economic prosperity, in order for Latin America to minimize its dependency on external factors, economic freedom must be restored.