Latin American and the Caribbean is currently seeing the worst impacts of the COVID-19 pandemic among any region of the world. The United Nations Economic Commission for Latin America and the Caribbean (ECLAC) reported this week that the region needed to take more action to fight spiking poverty and unemployment. The agency reported in July that the region is experiencing a 9.1% economic contraction—the worst since recordkeeping began in 1900. To combat this, ECLAC is suggesting states undergo fiscal expansionary policies to keep their economies afloat, and it estimates that public spending across the region will expand to roughly a quarter of GDP on average. ECLAC also reported a 23% drop in foreign trade across the region, as the global economic downturn caused by the pandemic has reduced Latin America’s oil, mineral, and manufactured exports.
This economic hit has significant consequences for a region still struggling with sustainable economic development. A recent report from Fundação Getulio Vargas (FGV), a Brazilian think tank, outlined the effects of Brazil’s emergency payment program scheduled ending in December. The payout program, similar to that adopted in the United States, is estimated to have paid 44% of Brazilian households. FGV projects that if the program ends in December, 15 million Brazilians will return to poverty. The payout program has been very popular amid Brazilian residents, as FGV estimates it has led to a historic reduction of poverty in the country. As such, the Brazilian government is attempting to continue the program while reducing its debt burden—the program has cost the Brazilian Treasury $57.6 billion. Brazil has been one of the hardest hit by COVID-19 in the region. The lack of an adequate response by President Bolsonaro—a skeptic of the deadliness of the disease—and his government has led to Brazil suffering more than 5 million confirmed cases and almost 150,000 deaths.
Responses from other governments in the region have seen similar levels of success. While early efforts by the Argentine government were notably successful, progress has been lost in recent months. President Fernández imposed a strict lockdown in March that proved so successful that many civilian and opposition groups called for an easing of restrictions in July. Since then, infections have surged to over 800,000 cases. The responses from Mexico and Peru were similar. Initially aggressive in their response to the pandemic, both government responses were bogged down by strategic failures, including a lack of mass testing, contact tracing, targeted lockdowns, and easing out of the lockdown far too early.
This is not to say that the high numbers of coronavirus cases in the region are solely due to poor government responses. Latin American populations are far more urbanized compared to their European, Asian, or African counterparts. Many cities, such as Sao Paulo, Lima, Buenos Aires, and Mexico City, feature extensive, tightly packed slums that are prime grounds for the disease’s spread. COVID-19 is especially likely to spread in multigenerational households where social distancing is difficult. Poverty and poor-quality social safety nets have forced individuals to break lockdowns to work and earn a living. Combined with uneven levels of health care quality, the results in Latin America have been disastrous. Though the United States still leads the world in COVID-19 cases and deaths, Brazil, Peru, Mexico, Colombia, Argentina, Chile, Bolivia, and Ecuador are eight of the top twelve countries suffering the most coronavirus-related deaths per capita. Alleviating the negative impacts of the COVID-19 pandemic in tandem with addressing the conditions that allowed it to spread so extensively will be an immense challenge for a region already struggling to provide adequate government services and promote sustainable growth and development.