ECLAC and PAHO agree that Latin America's economic reactivation requires controlling the COVID-19 pandemic

The document prepared by both organizations proposes that health, economic, social and productive policies be articulated in a convergent and interrelated manner
Sale of sanitary products in Guayaquil (Ecuador), one of the cities most affected by the COVID-19 in Latin America

AFP/JOSÉ SÁNCHEZ  -   Sale of sanitary products in Guayaquil (Ecuador), one of the cities most affected by the COVID-19 in Latin America

The revival of Latin American economies will only be possible if the contagion curve of the COVID-19 pandemic is flattened, the Economic Commission for Latin America and the Caribbean (ECLAC) and the Pan American Health Organization (PAHO) said Thursday in a joint report. 

To achieve this, the document proposes that health, economic, social and productive policies be articulated in a convergent and interrelated manner, but always prioritizing health.  "There is no dilemma between economy and health, the first thing is health," said ECLAC Executive Secretary Alicia Bárcena during the presentation of the report. 

"Countries should avoid thinking they have to choose between reopening economies and protecting the health and well-being of their people. Full economic activity cannot be resumed unless we get the virus under control," said PAHO Director Carissa F. Etienne, who was also present at the event, which took place virtually.  In this sense, Bárcena indicated that countries should "invest in public health until reaching at least 6% of the GDP, with particular emphasis on primary health care". 

Latin America is currently the epicentre of the pandemic, with more than 4.5 million cases of COVID-19 and almost 190 000 deaths, while in the social and economic sphere the disease has unleashed an unprecedented economic and social crisis that could turn into a food and humanitarian crisis if no action is taken. 

The coronavirus has led to a recession which, according to ECLAC projections, will mean a fall in regional growth of -9.1% in 2020, accompanied by a rise in unemployment to around 13.5%, an increase in the poverty rate of 7.0 percentage points to 37.3% of the population and a worsening of inequality with an average rise in the Gini index of 4.9 percentage points. 

In fact, according to the report, the high degree of inequality in the region, accompanied by high levels of poverty, informality, lack of social protection and limited access to health, explain the high social costs of the pandemic. 

"Advancing equality is essential for effective control of the pandemic and for economic recovery. We must address the emergency and implement a strategy to overcome the structural weaknesses of economies and societies," said Bárcena. 

Control, reactivation and reconstruction 

To address the pandemic and its effects, ECLAC and PAHO propose in their report a set of social, economic and health policies to be deployed in three "non-linear and interrelated" phases, which they call "control, reactivation and reconstruction". 

The list of measures suggested in the document underscores the need to coordinate health policies with economic, social and production policies. With a view to both the actions to control the pandemic and the recovery and reconstruction stages, the report considers it "essential" that public investment in health be increased to at least 6% of each country's GDP. 

"This will ensure the strengthening of health systems, expanding the supply of quality services, immediately and rapidly addressing unmet health needs, reducing inequities and increasing financial protection," the document states. 

Among the measures, the document also reiterates the importance of implementing an emergency basic income that would make it possible to sustain consumption and satisfy the basic needs of the entire population living in poverty in 2020 (37.3% of the population), in addition to a bonus against hunger. 

In addition, ECLAC and PAHO recommend that international financial institutions provide low-cost credit lines and that support be given to companies that have been affected. 

Finally, it advocates strengthening health systems and that they be conceived "not only as a government sector, but as a dynamic economic sector that has an expansive effect on the rest of the economy", so that health is recognized as a human right and a public good guaranteed by the State.