COVID-19 and the situation of the economy is as if it were a war, it immediately moves to the market to assume a central role, not only in the health battle against the virus, but in attending to economic risks and social coexistence . In this global framework, the crisis is unfolding in Latin America through five transmission channels:
The decrease in the economic activity of its main trading partners.
The fall in the prices of raw materials for export. Disruption of global value chains.
The lower demand for tourism services.
Increased risk aversion and worsening global financial conditions.
Integration would be, in the current critical circumstances, a crucial asset to face the crisis, the United Nations Economic Commission for Latin America and the Caribbean (ECLAC) affirmed that the region has no other strategic option than to move towards a development model more sustainable through greater integration to mitigate the effects of the COVID-19 pandemic in the region.
Before COVID-19, ECLAC expected that the region would grow a maximum of 1.3% in 2020. However, the effects of the crisis led to the change in that forecast and forecast a drop in GDP of at least -1.8%, although they do not rule out contractions of between -3% and -4%, or even more. . The final economic impact will depend on the measures taken at the national, regional and global levels, the agency indicates. The forecasts for employment in Latin America were not good and after the arrival of the COVID-19 pandemic they are worse.
Vinícius Pinheiro, ILO Regional Director for Latin America and the Caribbean, estimates that the global economic slowdown, together with the expectation of the spread of the pandemic, will lead to an increase in unemployment, particularly among the most vulnerable, greater precariousness, decreased income and great pressure on social protection systems. Up to 25 million people could join the ranks of unemployment worldwide as a cause of the pandemic, according to new ILO estimates, and a large part of them will be men and women from Latin America