Covid-19 in Latin America: Brazil Hardest Hit as Region Braces for Peak Pandemic

The pandemic reached the region in February, but while the death toll has climbed more slowly than in other regions, and its speed and scope varies widely from country to country, the economic consequences will be severe, given that such a large proportion of the population is engaged in the informal employment sector.

Despite a relatively lower  level  of  a Covid-19 penetration  in  comparison  to  the  US,  Europe  and  Asia,  Latin American governments have largely reacted swiftly and preventatively, taking an array of measures to protect their citizens and contain Covid-19’s spread, according to a report by the Organisation for Economic Cooperation and Development (OECD). The region faces significant challenges in mitigating the virus’ impact, however, given the countries’ less expansive and sophisticated healthcare systems and social safety nets, the OECD says.
 

However, testing is not widespread and, with much of the region’s population living in densely populated cities or in remote rural areas, it is likely that the full human impact of the pandemic will not be known for some time. The social impact however will be acutely and quickly felt, and will prove to be a serious test of the region’s governments and their ability to attend to their citizens, coupled with the need for cooperation and quarantine measures to be respected in order to mitigate the spread of the pandemic.

Leaders League has put together an overview of the developments to combat the pandemic in the region’s major economies.

BRAZIL

Brazil, Latin America’s largest economy, has so far been the hardest hit by the pandemic, with the number of fatalities reaching 4,200 by April 26th, and with more than 62,000 confirmed cases. Since the pandemic reached the country, President Jair Bolsonaro has come in for harsh criticism for his refusal to act quickly, describing the virus as a media construct, and opposing the business closures imposed by the country’s states after the Supreme Court ruled in early April that the states have the autonomy to impose isolation measures.
 

The government’s first victim of the Covid-19 fallout was health minister Luiz Henrique Mandetta, who was fired on April 16th by Bolsonaro following their disagreement over how to combat the pandemic, and who was replaced by Nelson Teich, an oncologist. But Bolsonaro’s woes continue, with his justice minister Sergio Moro resigning on 24 April in protest at the president’s decision to sack police chief Mauricio Valeixo, what Moro described as the president’s meddling in law enforcement. Moro’s resignation has been described by analysts as the biggest blow yet to Bolsonaro’s presidency.
 

Bolsonaro is expected to pick secretary of the presidency, Jorge Oliveira, as his new justice minister, while Alexandre Ramagem is tipped to be the new head of the police, and who is currently head of Brazil’s intelligence agency, according to Reuters. Brazil’s mainstream media speculates that Bolsonaro’s removal of Valeixo as chief of police is a move designed to protect two of the president’s sons, Carlos and Eduardo, who are alleged to have links to the Rio de Janeiro mafia and a fake news organisation respectively. President Bolsonaro, and both sons, have denied the allegations.

In response to the pandemic, Brazil is recruiting an additional 5,000 doctors through its Mais Médicos (more doctors) programme, and announced the deployment of an additional 2,000 ICU beds, while approving the inclusion of Covid-19 testing as an obligatory procedure in health insurance plans for suspected carriers, according to the OECD.
 

Bolsonaro’s government in March pledged $1 billion for the health ministry to fight the virus, while around $185 million will be channelled to states and municipalities to cover extended hours in public health facilities, distributed according to state population.

In addition, the government announced a universal income plan, facilitating $120 monthly payments to the most vulnerable, include the elderly, informal employees and the disabled, with double that amount for single mothers, while payment of an annual bonus for pensioners and retirees would be brought forward and cash payments to families, known as the Bolsa Familia, would be expanded to a further 1.2 million families. School meals are being distributed to families during the school closures.
 

There is concern in Brazil regarding the vulnerability of the more than 800,000 inhabitants of indigenous communities in the country, many of which do not have contact with society and live in remote areas with little or no healthcare facilities. So far three indigenous people are known to have died from Covid-19, amid fears that illegal miners and loggers entering indigenous territories unchecked could be carriers of the virus.  

 

ECUADOR

Despite its relatively smaller size, Ecuador saw a rapid outbreak of Covid-19 and rapidly imposed a curfew, but which was not sufficiently heeded, impeding the containment of the pandemic, health minister Juan Carlos Zevallos was quoted by media as saying. Zevallos is new to the job, having replaced Catalina Andramuño, who had resigned from the post in late March.

Fatalities from the virus in Ecuador have now reached 576, with more than 22,000 confirmed cases of Covid-19, making it South America’s third worst-affected nation.
 

The country was quick to close its borders, with the entry of foreigners prohibited from March 14th, a day after all schools closed, while gatherings of more than 30 people were forbidden and a lockdown was imposed that same week, as well as a suspension of road transportation and domestic flights between provinces. The government also imposed a 9pm-5am curfew and restricted traffic according to vehicle number plates.

Economic contingency measures have been scant however, with government assistance to workers limited to a one-year deferment of utility bills for farmers, small business owners and artisans.

Guayas Province, the capital of which is Guayaquil, the country’s second-largest city, has been particularly hard hit by the pandemic, accounting for more than 67 per cent of all cases in the country, with hospitals and morgues overwhelmed, according to media reports.

Quarantine measures across Ecuador are expected to remain in place until the end of May, but local authorities will decide when to lift measures imposed to isolate the population, the country’s President Lenin Moreno said on April 26th.

ARGENTINA

Latin America’s first country to record a death from Covid-19, on March 7th, Argentina has since seen a relatively low fatality rate for the region, and which currently totals 192, with more than 3,600 confirmed cases, according to the government. The country will remain in lockdown until May 10th, but from which public works employees, lawyers and accountants outside of Buenos Aires metropolitan area are exempt, and who were allowed to return to work in nine provinces from April 27th.
 

The decision to relax quarantine measures in the provinces will depend on provincial governments, President Alberto Fernández said upon issuing a decree on April 25th allowing citizens to spend an hour a day outdoors, citing the psychological benefits for people who have been in quarantine, although the move was criticised by some provincial governments as being too risky with the number of confirmed Covid-19 cases still rising.
 

Fernández has acknowledged that Argentina is fighting a war on two fronts, “against the pandemic and against the recession,” with the country’s economy already in the doldrums prior to the pandemic, and which is a situation he said the country shares with neighbouring Chile. 

 

CHILE

Chile’s death toll from Covid-19 has reached 198, with more than 13,000 confirmed cases. The pandemic’s arrival in the country forced the postponement of a referendum on a new constitution, originally scheduled for April 26th, until October. The drawing up of a new constitution was one of the demands made by anti-government protesters that participated in a series of violent clashes with security forces in late 2019, as the current constitution dates from the regime of dictator Augusto Pinochet. President Sebastián Piñera said on April 27th however that the referendum may need to be further postponed, in the light of the ongoing pandemic.
 

Chile moved to guarantee access to testing by establishing a maximum cost of $30 per test in private healthcare clinics, and the government enacted a law to protect income, allowing for workers unable to work remotely to receive their salary, with the creation of a $2 billion unemployment fund. In addition, the Covid-19 Bond was created, allowing low-income families to delay debt payments without having their utilities disconnected, with a payout of $60 per family.
 

The government has said it will issue certificates to citizens who have recovered from Covid-19, enabling them to return to work, despite World Health Organization (WHO) recommendations that recovery does not lead to immunity and that the issue of such certificates could create a false sense of security.

COLOMBIA

Colombia has extended its obligatory isolation measures imposed on 20 March until May 11th, where the number of fatalities from Covid-19 is currently 244 and the number of confirmed cases has surpassed 5,000, according to the country’s national health institute (INS). Like many countries in the region, it is the Colombian economy’s informal sector that is seeing the harshest immediate impact, according to local media reports, as families unable to make a living amid the quarantine measures struggle to afford food.

In response to the pandemic, the government has made available additional financial resources via social programmes, disbursed to 2.6 million impoverished households, earmarking some 200,000 young people and 1.5 million pensioners, as well as ramping up public access to water to include an additional one million people free of charge, according to the presidency.
 

In addition, the government announced in March the disbursement of about $40 million to three million low-income families, and food and water distribution to vulnerable populations, as well as condoning mortgage payments for two months. The government also announced a VAT reimbursement to 100,00 families, payable from January 2021.

The country closed its border with Venezuela on 20 March, and is controlling access from Ecuador, and has obligated incoming passengers from Europe to spend 14 days in quarantine.

MEXICO

Mexico’s death toll reached 1,351 on April 27th, a two-fold increase on the previous week’s tally, with the government announcing that quarantine measures will continue until May 30th. While the measures are not as strict as in other countries of the region, and do not include a curfew, some of the country’s 32 states are now imposing fines and even imprisoning people for up to 36 hours if found to be out and about without due reason.
 

In a message to the nation on April 26th, President Andrés Manuel Lopez Obrador announced that the country had “tamed” the pandemic, despite warnings from health officials that cases in the country have yet to peak. López Obrador had previously announced a package of austerity measures, reducing the salaries of public officials by 25 per cent, in order to channel more funds into social and health programs, and which will remain in place until the end of the year.

According to an opinion poll cited by Reuters, 73 per cent of respondents approve of the measures imposed by López Obrador, in spite of the president coming in for criticism in March by continuing to attend mass gatherings despite the government’s advice to citizens to stay at home.

The federal government is offering three million loans to small businesses with a maximum of five employees, but which can only qualify for the financial help by not having made employees redundant and having them actively enrolled in the country’s social security system (IMSS).
 

The government has also decreed tax breaks for private companies engaged in oil and gas production in the country, waiving their obligation to pay taxes under the hydrocarbons law, given that their revenues will be impacted by the drop in the price of hydrocarbons.  
 

Mexico is now in what it has termed phase three of the pandemic, with schools and non-essential businesses remaining closed until at least June 1st and with no relaxation of quarantine measures in sight. The Mexico City government this week imposed the requirement that all citizens use face-masks when venturing outdoors.

 

PERU

Peru was the first Latin America to impose quarantine measures on its citizens, with 782 fatalities recorded to date and more than 28,000 confirmed cases. Protests have erupted in recent days among health workers complaining of the lack of protective equipment, while some provincial hospitals are reporting a lack of ventilators, prompting media reports of a collapsing health service. President Martín Vizcarra announced this week that the lockdown measures would continue until May 10th.
 

With the second-highest number of cases in South America, the Peruvian government claims that the country is carrying out more tests than others in the region, with a total of 230,000 carried out so far, and of which around 10 per cent have come back positive, leading officials to believe that the number of cases could surpass three million over the coming months.

“Difficult days are coming,” Prime Minister Vicente Zeballos was quoted as saying on April 20th.
 

The government declared a state of emergency on March 15th and rolled out a series of containment measures that went further than many other countries in the region, and which have possibly contributed to the fatality rate remaining comparatively low. Those measures include an 6pm-5am curfew (and from 4pm-5am in the north), the prohibition of all private vehicles from the roads, closing all of the country’s borders and forbidding movement between the country’s provinces, and the halting of all incoming flights from the US and Europe.

In a move that was unique to the region, but which was later abandoned after proving unworkable, the government imposed alternate days for men and women to be allowed out of their houses, ostensibly to reduce traffic in markets and shops for the purchase of essential goods.

The government’s economic contingency plan includes a $110 payment to three million people classified as vulnerable, as well as advancing payments to low-income elderly citizens and people with special needs, and a per-family payment of $220 announced on April 23rd that aims to benefit 6.8 million households with no fixed income.
 

In a sign that the country does not expect to be able to lift the quarantine or social distancing guidelines any time soon, the Lima International Book Fair announced earlier this month that this year’s event, which was to run from July 17th-August 2nd, and which last year attracted more than 500,000 visitors, has been cancelled.