More economic integration to tackle coronavirus in Latin America

The whole world is facing the threat of the coronavirus. Giants like China have been hit by it and it's put a hole in their economy. The European Union is struggling to mitigate the great impact of what is already known as "the big shutdown". The United States, Africa, Latin America... few corners of the world are spared from the worst epidemic in living memory since the 1918 flu. But once the health crisis passes, there will be a long period of recovery. And not all countries are starting from the same level. Latin America has already suffered the worst capital flight since records began, and countries now have more debt and are more vulnerable. "We need more economic integration to face this tragedy," said Rebeca Grynspan, head of the Ibero-American General Secretariat, who participated in a virtual meeting organized by Nueva Economía Fórum on Wednesday.  

Grynspan said that Ibero-America had been better prepared for the arrival of the virus by observing the havoc it was causing in Europe. "Confinements and security measures were announced very quickly thanks to the example of Europe". The countries that are now in the midst of a pandemic are Peru, Brazil and Ecuador. On the other hand, Mexico, Costa Rica and Uruguay have already begun to devise de-escalation plans. "Right now there are 100,000 active cases and around 9,000 deaths," explained the head of the project, who warned that the sub-continent's health systems are still very weak and a large part of the population lacks health coverage.  

However, Grynspan has expressed concern about the economic effects that this crisis will bring. "This is the worst recession since 1929. The effects on the economies will be very severe and the worst thing is that Latin American countries are now less well prepared to deal with it than they were in 2008. The fiscal margin is smaller and they are more in debt," she said.  

ECLAC has already warned in a report that the recession in the subcontinent could reach 5% and up to 30 million more poor people. "The impact will be threefold: supply has been affected, demand has collapsed and the financial market has been affected," said the head of ECLAC. In order to face the complex situation, the economist has called for the strengthening of integration among Latin American countries. She also stressed the need to work closer with Spain. "Now more than ever we have to help each other," she said. 

Grynspan has announced that the body she leads is already preparing some initiatives with the Spanish government. "We are in permanent contact with the Minister of Foreign Affairs, González Laya, to learn from each other," she said.  

Some economic institutions, such as the Latin American Development Bank (CAF), have already announced up to 10 billion dollars in financing credit lines to save small and medium-sized enterprises. "We need coordinated action to meet all the challenges ahead and all aid is too little," she concluded.