This article by The Dialogue claims that the COVID-19 pandemic is one of the worst shocks ever to affect Latin America and the Caribbean. Governments, firms, and workers are coping with a severe economic crisis with yet unknown human losses and potential for social disarray. The region is being hit by large demand shocks from sharp commodity price falls due to a slump in external demand, external capital flight, financial sector volatility, and a collapse in tourist flows due to border closures and immobility measures. These shocks have been exacerbated by output disruptions associated with mandatory social distancing which have paralyzed all non-essential economic sectors, with a high toll on the spending capacity of millions of firms and consumers. In view of this situation, there is an urgent need to build more resilient societies, with buffers to mitigate shocks and adequate delivery of public goods and services. This will test the capacity and determination of all relevant actors in the region.

Latin American governments have implemented some of the swiftest measures in the world to prevent the spread of the novel coronavirus. El Salvador closed its borders to foreign travelers and imposed a national quarantine on March 12, a full week before the country registered its first case of COVID-19, the disease caused by the virus. And on March 15, Peruvian President Martín Vizcarra suspended the constitutional right to free movement and deployed the military to enforce mandatory social distancing and arrest thousands who violated the restrictions. Although two of the region’s largest states—Brazil and Mexico—have resisted lockdowns and dismissed the danger that the virus poses, other major countries, such as Argentina, Chile, and Ecuador, were among the first in the Western Hemisphere to close schools and impose nationwide curfews.