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Latin America's COVID-19 outlook worsens ahead of peak

Thursday, May 14, 2020

Estimates of the social and economic impacts of the coronavirus are worsening and will deteriorate further

The region will see the deepest recession since 1930

Source: Oxford Analytica; Johns Hopkins; UN Economic Commission for Latin America and the Caribbean (ECLAC); ourworldindata.org

Outlook

Forecasts of the COVID-19-related GDP contraction in Latin America this year have steadily worsened; the UN Economic Commission for Latin America and the Caribbean (ECLAC), World Bank and IMF now estimate falls of 5.3%, 4.6% and 5.2%, while the Bank of Spain estimates up to an 11.5% drop.

Public opinion on responses is mixed: governments in Argentina and Peru have won support for tough measures, but Mexico’s president has done well despite criticism that he has done too little.

The presidents of Brazil and Ecuador may be most badly damaged and governability will suffer.

Impacts

  • Approval may fall sharply as fear of contagion eases and the economic impact becomes more evident.
  • Only Guyana will see growth this year as oil comes onstream; even those forecasts have fallen sharply.
  • Poverty and unemployment will soar as economies shrink; the number in poverty may rise by some 35 million this year.
  • The rapid expansion of the coronavirus now to low-income neighbourhoods will increase infections and deaths.

See also