Latin America and the Caribbean will suffer the worst economic and health impact from the coronavirus, the World Bank said Friday, forecasting a nearly 8.0 percent drop in regional GDP.
“Our region is suffering the worst economic and health impacts of Covid-19 of anywhere in the world,” according to Carlos Felipe Jaramillo, the Bank’s regional vice president.
He said the findings in the report “calls for clarity on how to combat the pandemic and put the economies back on track for a swift recovery.”
In its report, “The Cost of Staying Healthy” the Bank addresses the impact of the pandemic in a region with with high Covid-19 mortality and infection rates such as Brazil, Mexico and Peru.
“The number of deaths per million people is as high as in advanced economies, if not more, but the resources available to counter the shock are much more constrained,” it said.
The bank forecasts a recovery with growth of 4.0 percent in 2021.
The report forecasts a region-wide 7.9 percent drop in GDP, a slightly more negative outlook for 2020 than its last assessment in June of a likely 7.2 percent contraction.
Crisis-wracked Venezuela — in acute recession for several years and with a government that at least 50 countries refuse to recognize — is not taken into account in the figures.
The Covid-related economic crisis follows “several years of disappointing economic growth and limited progress on social indicators, and right after a wave of social unrest,” the report said.
“The social damage is immense” the institution warned, adding that unemployment rates had soared across the region, “sometimes substantially.”
Surveys conducted in 13 countries in the region showed that the share of households suffering a decline in income is higher than the share experiencing job losses, it said.
The findings suggest that “the impact of the crisis is not only severe but also potentially long-lasting.”