Latin America and Covid-19
The pandemic is having serious effects in the region, and they will persist for some time.
Via CBS News: Latin America: The global epicenter of COVID-19
The number of COVID-19 cases in Latin America and the Caribbean has positioned the region as the global epicenter of the virus. Health professionals and regional experts are warning that if nothing is done, the region will see major setbacks, including a massive rise in poverty and a rise in authoritarianism, as leaders see an opportunity to crackdown on dissent. Latin America, which accounts for 8% of the world population, has reported nearly 30% of the global fatalities.
Reported deaths in the region have topped 230,000, according to data from Johns Hopkins University, putting the death toll for the region as a whole higher than that of the United States and Canada combined. If prevention measures are not maintained, the death toll could reach 438,000 by October, according to the World Health Organization’s regional director for the Americas.
If we look at the Worldometers stats and sort by cases per 1 million, French Guiana is #2, Chile #5, Panama #6, Peru, #8, Brazil #10, Aruba #14, Colombia #20, Turks and Caicos #22, and Bolivia #24 (half of the top ten, and nine out of the top 25).
In raw numbers, Brazil is #2 in the world in cases behind the USA as well as #2 in deaths, again behind the USA (which ought to be tired of all the wining, I have to add), with Mexico in third place.
In terms of death per million residents, Peru is third on the list and Chile ninth. With Brazil (11), Mexico (12), Panama (14), Sint Maarten (15), Bolivia (16), Ecuador (19), Colombia (20) occupying space in the top 25. (The US is 10th by this metric).
A key implication of this situation is that the region is economically vulnerable and therefore the impact of the disease on the region would be devastating. I am seeing talk of a second “lost decade” for the region (i.e., that all of the economic gains of the last ten years could be erased). This would be a “second” lost decade to go along with the 1980s, known as the Lost Decade due to the effects of the debt crisis on the region.
The pandemic has highlighted the existing weaknesses in the region, such as persistent inequality and poverty, at a time where the region was already struggling. Additional factors, such as the reliance on tourism, commodity exports, and remittances (money sent from citizens working abroad mostly in the US) are especially problematic under current conditions.
As a recent UN policy brief (The Impact of COVID-19 on Latin America and the Caribbean) notes:
When the pandemic hit the region, its economies were already experiencing serious difficulties. In the preceding six years (2014-2019), economic growth had been the lowest (0.4%) recorded in since 1951. In addition, fiscal space contracted and public debt increased in Latin America, from about 30% of GDP in the period 2009-2011 to over 45% in 2019. In the Caribbean, the average debt was 68.5% of GDP in 2019. As a result of a series of external shocks, compounded by structural weaknesses and vulnerabilities and high exposure to natural disasters and the impacts of climate change, some Caribbean SIDS are among the most indebted economies in the world.
ECLAC estimates that GDP could fall in Latin America and the Caribbean by 9.1% in 2020. The external drivers of this are an expected fall in exports (20%12), a decline in remittances to the region (of around 20%13) and lower demand in the tourism sector (during the first four months of the year tourist arrivals fell by 35% in Central and South America, and 39% in the Caribbean14) (see figure 1), which will hit the Caribbean particularly hard . Women will be especially affected, as they are more likely than men to work in accommodation and food services (60% of employees), a proxy measure of employment in the tourism sector.
Note this graph:
All of this is quite significant. Consider, for example, the importance of remittances and think about how much of that is from workers in the US service industry and how the pandemic has affected the said industry. I am especially struck by the hit that the tourist industry is taking, and is going to be taking, as we continue to deal with Covid-19.
Reliance on commodity exports (e.g., raw materials, agricultural products, etc.) is a long-term story in Latin American economic development. One thing is certain: when there are global tough times, commodity prices suffer. And, certainly, the US is a major customer for those goods, and as the US economy suffers, so, too, will these economies suffer.
Note, especially, Honduras. It is one of the countries that has been a source of migrants to the US and the crisis that the Trump administration has helped create on the border. If almost 50% of that country’s GDP is made up of tourism, remittances, and the commodity trade, what do we all think is going to happen to the flow migrants from Honduras? What affect will this have on violent gangs linked to the drug trade? How will this spill over into neighboring states, who are also dealing with similar issues?
The management of this crisis in the US (or, indeed, lack thereof), as well as the poor management in larger Latin American states like Brazil and Mexico, has broader impacts. Mismanagement in the US affects Honduras directly, which will have economic impacts on that country for the next decade and will, therefore, have policy implications for the US for years and years to come (both in immigration and illicit drugs).
All of this underscores, yet again, how the ineptitude of the Trump administration has large, long-term, global implications. While no one could have stopped the pandemic, having a competent POTUS who took this seriously back in January and February (and who worked effectively with leaders in other countries) could have led to a far more efficacious response.
Instead, here we are.
And beyond the economic effects, the pandemic is creating space for democratic backsliding in the region. Back to the linked CBS article:
“The pandemic arrived in Latin America at a time when the region was already suffering a democratic disaster,” said Daniel Zovatto, a senior fellow at the Brookings Institution’s Foreign Policy and Latin America Initiative, referring to the wave of anti-government protests that took over the region last year, in countries including Chile, Venezuela, Honduras, and Haiti.
In some cases, like that of El Salvador, Zovatto said that President Nayib Bukele used the pandemic to consolidate executive power from the congress and supreme courts since he did not have a majority. But there are more serious examples, like Cuba, Venezuela, and Nicaragua – countries that already have authoritarian regimes – which have used coronavirus restrictions to crackdown on dissent and protests.
“We have to coordinate, and speak out as one voice to defend our interests,” said Zovatto, of all the countries in Latin America, “to let the world know that Latin America also needs help. If we don’t find that help, we’re going to find ourselves in a very difficult situation.”
So, when people pretend like this is all no big deal, or that we are all just overreacting, the fact of the reality of it all is actually more than a bit depressing.
Es lo que es, I guess.