From now on it can only get better ¿Sí?

by Daniela Cortés

Latin-America is the teenager, depending on its parents United States or Europe, for its growing economy. But what happens when those parents stop providing economical support?

Living in a developed country where economy is strong, and relatively independent is different than to live in countries from Latin America which are still in development. While countries in Europe are working to mitigate, in a shorter term, the aftermath of shutting down, for Latin-America, there is still a long way to go.

images via Unsplash: TOP: Marilia Castelli, Kevin Bluer BOTTOM: Benjamin Rascoe, Jose Gil, Juan Ordonez

The region became the centre of the pandemic while the UK was easing down restrictions.

With an ongoing lockdown, the consequences could be devastating for the entire region.

Latin-America is facing a deep recession, said Paula Garda, OECD Economist, Chile/Colombia desk, said, “like never before this is aggravated by simultaneous health, economic, raw material and social price shocks, in unison throughout the region.”

The pandemic caught the world by surprise. When countries like Spain and Italy were on orange alert, and the number of active cases grew, Latin-America was taking measures to prevent the virus. However, these measures were not enough.

“ When forced to lockdown, people will start to overlook the law. ”

The importance of prevention was due to the Social Determinants of Health, an indicator measured by the World Health Organization.

“The region faces its own challenges that aggravate the panorama: a limited fiscal space, less developed health and social security systems, large capital outflows, a large proportion of informal workers without any social protection, and great social discontent,” explained Garda.

According to the International Labor Organization, more than 53% of the labour force in Latin America is informal. “This means that if you worked and earned £10, that is all you get. But if you had a bad day and didn’t earn anything, then zero is what you go home with. It is a model on which you live day by day. When forced to lockdown, people will start to overlook the law, and go out to work to get what they need to survive,” explained Melissa Russi, Economic and Labour Sociologist.

The scenario results in some people ignoring restrictions and some others losing their jobs because companies, small and medium-sized, are not able to hold all the positions while not producing any income.

" Not everyone has access to a smartphone/laptop or knows how to use them "

Governments without enough resources face a sudden poverty increase that will hit the economy for a long time.

Adding to it, the region has had to adjust to what the world calls “the new normal”.

Working and studying from home was, for many, a silver lining. People had to learn how to balance it, and though some people struggled, in the end, it became the new normal, along with a vast set of memes to lighten up the mood.

image: Diego Marin via Unsplash

Migrating to online work and school was a possibility for some companies and education centres, but the fact that you can move your operations to an online environment is not a guarantee that your employees/students will be able to do the same. Specifically, true in Latin-America.

“Not everyone has access to a smartphone, a PC, a laptop, a high-speed internet connection, etc. But beyond the tools, there is also a lack of education on how to use them and the digital platforms,” observed Russi “now you have a person that has to sit the whole day in front of a computer and also needs to upgrade his internet connection to meet the requirement for his job.”

According to both experts, this pandemic is an opportunity for the whole region to invest on their national assets, resources and develop new ways to support national businesses.

But what comes next?