Pandemic hits Lat Am economies (March 27, 2020)

Latin American and Caribbean nations are unveiling financial aid packages to help stave off the economic crisis created by the coronavirus -- but it's hard to tell whether they will be sufficient, and they come at a steep price for countries ill-able to bear the cost, reports the Miami Herald. 

"The virus has struck a patient that in economic terms has a serious pre-existing condition. Since 2014 the region’s economy has grown at an annual average rate of less than 1% a year and income per person has dropped," explains the Economist. Some experts say the regional impact could be worst than that of the 2008-2009 global financial crisis.

Quarantines in the region are complicated by the high number of informal workers in Latin America and the Caribbean.

"Multilateral institutions have largely been absent in the response in Latin America. Yet their funding will be necessary for the region’s societies and economies to recover," argues Charles Call in a Brookings Institution post that warns of "grim" long-term implications of the coronavirus epidemic and that "the social, political, and economic consequences could be dramatic." The piece reviews some of the responses around the region, and economic measures. Corruption might not be the primary concern at the moment, but " both international and national actors should strengthen, rather than suspend, mechanisms for accountability and transparency as billions of dollars are mobilized outside of regular channels," writes Call.

Another issue, clearly, is class, as throughout the region the disease and disparate access to care threaten to deepen economic inequality. (BBC)

News Briefs

Regional

• Exceptional times call for exceptional measures, and have the potential to fortify authoritarian tendencies. But they also offer the opportunity to push political boundaries in a positive sense: for example by expanding state regulation or making budgets more flexible, write Pauli Huotari and Teivo Teivainen in Nueva Sociedad.

Venezuela

• The U.S. indicted Venezuelan President Nicolás Maduro and 15 top current and former officials yesterday, who authorities accused of collaborating with a dissident faction of Colombia's FARC guerrillas and charged with "narco-terrorism." (See yesterday's briefs.) The move to indict a foreign head of state (though the U.S. and dozens of countries don't technically recognize Maduro as such) is highly unusual, and builds on the U.S. Trump administration's efforts to pressure Maduro out of office. The U.S. State Department also announced a $15 million reward for information leading to Maduro's arrest. (Guardian, New York Times)

• The charges echo the U.S. indictment of Panamanian dictator Gen. Manuel Antonio Noriega in 1990, reports the Miami Herald. Noriega, however, faced justice only after the U.S. invasion of Panama in 1989, in this case, it is less likely that Maduro will actually sit in a U.S. court.

• In separate indictments, prosecutors in Miami charged the head of the Venezuelan supreme court, Maikel Moreno, with money laundering. And charges dating back to May 2019 were unsealed in Washington against the defense minister, Gen Vladimir Padrino, accused of permitting planes carrying drugs to transit Venezuelan airspace. (Guardian)

• A group of U.S. Democratic lawmakers urged the Trump administration to temporarily suspend economic sanctions against Venezuela and Iran, and bolster humanitarian aid to both countries in order to help their coronavirus responses, reports the Huffington Post. (See yesterday's briefs.)

Diplomacy

• China is leveraging medical aid -- equipment and expertise -- as a soft-power tool in Latin America, reports Reuters.

El Salvador

• Salvadoran President Nayib Bukele has combined economic incentives, military-enforced prohibitions and general panic mongering into a, so far, successful coronavirus response, writes Roberto Valencia in the Post Opinión.

Brazil

• Brazilian President Jair Bolsonaro horrified the country's state governors -- including many former allies -- by dismissing his own health ministry recommendations to stay home. In an open letter to Bolsonaro published after a gubernatorial summit on Wednesday, a group of state leaders signaled they would ignore Bolsonaro's calls to scale back their lockdowns, reports the Guardian. 

• In return, the national government launched a campaign against the coronavirus quarantines, entitled: "Brazil cannot stop." (O Globo)

• The conflict has become heated: In a videoconference this week between Bolsonaro and governors from Brazil’s southeast region, São Paulo Gov. João Doria threatened to sue the federal government if it tried to interfere with his efforts to combat the virus, reports the Associated Press.

• On the other hand, some drug gangs are taking the coronavirus threat very seriously. The Comando Vermelho, which controls the Rio de Janeiro Cidade de Deus favela, ordered residents to stay in their homes after a reported Covid-19 case. Gangs have reportedly declared curfews or limited movement in other favelas, including Rocinha and Morro dos Prazeres. (Guardian) “If the government isn’t capable of making it happen, organized crime will,” vows one gang on WhatsApp. (Economist)

• In his latest scandalizing press interview, Bolsonaro argued that Brazilians are immune to disease in general, including Covid-19. He also theorized that many Brazilians have already been infected by Covid-19 and are now immune. (Guardian)

• However, the reality on the ground is different: "If the virus in Italy jumps between generations living together, in Brazil it started by hopping between classes, which are socially distant but physically close," reports the Economist.

Mexico

• The theory that some people are immune to Covid-19 has no scientific backing, but Bolsonaro isn't the only believer. Mexico's Puebla state governor, Miguel Barbosa, claims poor people are immune to Covid-19. (Guardian)

• Mexican President Andrés Manuel López Obrador is putting the people of Mexico in grave danger with his reckless disregard for providing accurate information on the COVID-19 pandemic, Human Rights Watch said in a report earlier this week.

• What Mexico's coronavirus response does need is an awareness of the collateral effects of pandemic controls on the majority of the country's population which suffers discrimination and lives in inequality and poverty, argues Alexandra Haas of the Centro de Investigación y Docencia Económicas (CIDE) in the Post Opinión.

• Mexicans are incensed at ongoing transit across the country's border with the U.S., and have threatened to block traffic into Mexico, reports the BBC.

• Inclusion in Mexico's national census for the first time has given the country's afro-descendent population visibility. (Post Opinión)

Exotic fauna

• It is, apparently, difficult to overestimate the positive ramifications of Pablo Escobar's hippos -- or we really really really need non-coronavirus news. (New York Times)

I hope you're all staying safe and sane as possible, given the circumstances ... And in these times of coronavirus, when we're all feeling a little isolated, feel especially free to reach out and share.

Latin America Daily Briefing