Latin America and the Caribbean are experiencing “the worst economic and health consequences” in the world due to the COVID-19 pandemic, according to the World Bank (WB), which forecasts a decline in the regional gross domestic product of 7.9 % in 2020.
“Our region is experiencing the worst economic and health consequences due to Covid-19 in the world,” said World Bank vice president for Latin America and the Caribbean, Colombian Carlos Felipe Jaramillo, on Friday.
Previous estimates in June were for the economy to contract 7.2%.
But in 2021, the World Bank estimates a possible recovery, up to 4%.
These data do not take into account Venezuela, which has been in recession for many years and is experiencing a serious political crisis, with more than 50 countries not recognizing the government of President Nicolas Maduro.
In its report, the World Bank notes that in Latin America and the Caribbean “the number of deaths is as high as in advanced economies, if not more, but the resources available to cope with this shock are much more limited”.
Especially since this crisis occurs “after several years of disappointing growth and limited progress in social indicators”.
According to the World Bank “the social damage is immense” and unemployment rates have increased in the region, sometimes substantially.
In 13 countries, “the percentage of households that have experienced a decline in income is even higher than that of households that have lost a job,” the report says.
WB economists also noted that in five countries a large number of people said they were late in their payments or thought they might have difficulty meeting their commitments.
For the World Bank, this suggests that the impact of the crisis will not only be “severe”, but “potentially lasting”.
Latin America and the Caribbean had 9,831,306 infected people on Friday and 362,450 dead.