The long confinement of Latin America's SMEs

It is not that Latin American SMEs were doing particularly well before the pandemic, but the current situation has left them, for the most part, in a complicated situation, something that has repercussions for a good proportion of society and the economy.

The problems they face are the same as before the outbreak of COVID-19, but are now much more accentuated: low productivity, low generation of quality jobs, high informality, low competitiveness and innovation. 

It is estimated that in Latin America this type of company represents 99% of the business fabric, employs more than 60% of workers and its operations are equivalent to more than 25% of GDP. Their strong presence in the socio-economic fabric of the region partly explains the estimated impact of COVID-19 on national economies, with GDP falling by 9.1% on average and unemployment rising to 13.5%.

A number of measures are needed that should help the region's SMEs to generate more and better jobs and do their bit for economic recovery. 

Robert Valls, Senior Communications Executive at CAF

Visiones del Desarrollo is a section promoted by CAF -development bank of Latin America- that analyses the main development issues in the region. The articles it contains are published simultaneously in the main Latin American media.