The illnesses that the pandemic will inflict on the most vulnerable groups in Latin America will be cumulative. Governments must redirect the coexistence between capitalism and the State to alleviate this double punishment, and face the recession of economies with lead in the wings for seven years. The impact will not be the same in the Dominican Republic, Panama and Bolivia, whose GDP grew before the virus, as in Venezuela, Nicaragua and Argentina, affected by a bird that is not a consequence of the efforts made but is the fault of incompetence and widespread embezzlement. of resources. If the region copes with the present in fits and starts, its future will be rough, with blind sticks and political screaming.
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Although heterogeneous in the organization of programs and productive activities, the avalanche of red numbers complicates the life of a subcontinent that will record the greatest collapse of the domestic product since 1930, and will add 29 million new poor people, according to ECLAC. The pandemonium of injuries caused by the claw of the Covid-19 exacerbate the fragility of nations punished by chronic errors, the servitude of indebtedness and the little margin for more public spending without the concerted action of central banks and multilateral financial organizations.
The pandemic only exposes the regional defenselessness and the delay in the implementation of essential structural transformations. If the indicators of the conjuncture of the developed world are worrisome, the Latin American crossword puzzle is overwhelming because the bombardment of millions will not solve problems that are not only economic: corruption, insecurity, financial risks, business liabilities, capital outflows, misery, depreciations and contraction in demand . A long etcetera will translate into families without income, work or benefits, and more cannon fodder for populism and crime.
The slowdowns of the American, Chinese and European locomotives will cause the fall of tourism to the Caribbean, and the lowering of Aztec crude oil and raw materials that oxygenate the accounts of Brazil, Argentina, Peru and Chile. An avalanche of misfortunes over countries dependent on the export of minerals, agricultural products, manufacturing assemblies, and without firm safety nets to cushion the foreseeable declines.
Without margin to the contrary, financial institutions will enable lines of credit and assume the restructuring of debts that can never be paid. The IMF, the IDB and the Development Bank of Latin America will have no other option than to relax the conditionality of credits and transfers destined for economic reconstruction and the protection of SMEs and victims of labor informality.
Even so, the governments requesting such aid must guarantee that they are used without deviations towards useless or spurious projects and accounts abroad, as happened in the eighties, when Latin American debt with commercial banks came to mean 50% of GDP regional. Latin America's journey towards stability will not be easy, but the ravages of the coronavirus will facilitate its determination, reinventing objectives and tools. END
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