Latin America’s economic plight is getting worse

IN SãO PAULO 91% of intensive-care beds in hospitals are occupied even as cases of covid-19 soar. The city has declared a four-day public holiday to reduce travel. In poorer parts of Brazil, such as Fortaleza and Manaus, hospitals are even fuller. Much the same goes for Peru and Mexico. In Chile, which seemed to have been controlling the coronavirus, a sharp rise in cases and deaths saw the government lock down greater Santiago and left the health minister “intensely worried”. Faced with a record rise in cases this week, Argentina extended its lockdown. As the pandemic slows in Europe, it is surging in the Americas.

For Latin America that is both disappointing and worrying. Forewarned, many countries were quick to impose lockdowns two months ago. In a region where one worker in two toils in the informal economy, these are hard to sustain. Many countries, too, have organised emergency payments for large segments of the population and given credit guarantees to firms. But Latin American governments lack the fiscal firepower, as well as the effective institutions, of their counterparts in Europe or the United States. As a result, rather than having a rapid recovery, as some hoped, the region risks entering a dark valley in which both public health and livelihoods suffer over many months. Already, the effects are exacerbating inequality...

Read More