José Antonio Ocampo | October 6, 2020 | Brookings Institute
The COVID-19 crisis has dramatically affected Latin America. The region has become over the past few months the epicenter of the pandemic, and it will experience a contraction in economic activity of 9.1 percent according to the U.N. Economic Commission for Latin America and the Caribbean (ECLAC) or 9.4 percent according to the International Monetary Fund.
It is not only the worst regional recession in its history, but also the worst in the world after Western Europe. As a result, in the most pessimistic scenario—which is the most likely now—ECLAC estimates that poverty levels will increase from 30 to 36 percent of the population; that is, it will affect an additional 36 million Latin Americans.
The crisis also happens after what I have referred to as a “lost half decade”: five years of very poor economic performance, during which the region grew by just 0.2 percent annually. This is the worst performance for five years since the end of World War II. Slow growth has been accompanied by political crises in several countries and a weakening of democratic trends, which have been one of the strengths of Latin America since the 1980s.
Originally published by The Brookings Institute. Read the full article here.