New report warns regional economies will only be reactivated if COVID-19 curve flattens

New report warns regional economies will only be reactivated if COVID-19 curve flattens

Saturday, August 01, 2020

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WASHINGTON, DC, United States (CMC) — A new joint report by the Economic Commission for Latin America and the Caribbean (ECLAC) and the Pan American Health Organization (PAHO) has warned that regional economies will only be reactivated if the curve of contagion of the coronavirus (COVID-19) pandemic is flattened.

The report, released at a joint press conference led by Alicia Bárcena, ECLAC's executive secretary, and Dr Carissa F Etienne, PAHO's director, proposes a three-phase approach that includes the adoption of health, economic, social and productive policies that aim to control and mitigate the effects of the pandemic, reactivation with protection, and rebuilding in a sustainable and inclusive way.

According to the report titled, 'Health and the Economy: A Convergence Needed to Address COVID-19 and Retake the Path of Sustainable Development in Latin America and the Caribbean', some countries have led the region to become the current epicentre of the pandemic, topping global case numbers.

As of July 29, the report said there are more than 4.5 million cases of COVID-19 and almost 190,000 deaths in Latin America and the Caribbean.

“A significant number of countries remain far from achieving a sustained and significant flattening of the curve of contagion. The pandemic has also unleashed an unprecedented economic and social crisis which, if urgent measures are not taken, could transform into a hunger and humanitarian crisis.”

The report added that the pandemic has “profoundly affected the lives and livelihoods of people in the region.

“The pandemic has caused the most abrupt recession in history”, which, according to ECLAC projections, will imply “a regional drop in growth of -9.1 per cent in 2020, along with a rise in unemployment to 13.5 per cent, an increase in the poverty rate of 7.0 percentage points, which will reach 37.3 per cent of the population, and a sharpening of inequality with an average rise in the Gini index of 4.9 percentage points”.

The report states that health systems in the region, “which were already underfunded and fragmented prior to the arrival of COVID-19, are having to face the pandemic with weaknesses in the performance of the health authorities' steering role”.

It notes public health expenditure averages a mere 3.7 per cent of gross domestic product (GDP), falling from the six per cent target recommended by PAHO.

A third of the population still faces some type of barrier to access the health services they need, the report states, adding that “the high degree of inequality combined with the high levels of poverty, informality, lack of social protection and limited access to quality, timely health care, explain the high social costs that the pandemic is having in the region”.

The report stated that dynamics of contagion are also influenced by the high degree of urbanisation — more than a third of the population living in cities with a million or more inhabitants – and “the accumulated deficits in terms of overcrowding, lack of water and sanitation services, and crowded public transportation”.

Besides the commitment and dedication of health personnel, the report notes that historical weaknesses of the public health systems have also contributed to the vulnerability of the region.

The report argued that inequality in the region positions certain groups in a particularly vulnerable situation, including older persons (85 million), informal workers (54 per cent of regional employment), women (who make up the majority of the informal workforce, participate in unpaid work and have greater exposure to domestic violence), indigenous peoples (60 million people and some communities whose existence could be threatened), people of African descent (130 million people in 2015), people with disabilities (70 million people) and migrants.

“All these groups require special attention to mitigate their vulnerable conditions,” the report states, adding that in terms of health, households finance more than a third of health care expenses with direct, out-of-pocket payments.

It further notes that nearly 95 million people face catastrophic health expenses, and almost 12 million become impoverished due to these expenses.

The average availability of doctors and hospital beds is less than half that of more developed countries, such as those of the Organization for Economic Cooperation and Development (OECD), “which presents significant barriers to access”.

Due to the pandemic, health care for other diseases has also been postponed or interrupted, “which begins to be reflected in excess mortality that highlights the profound effects of the impact on supply and demand for services.”

To address the short- and long-term effects of the pandemic, ECLAC and PAHO propose a set of principles for action and policies, as well as a wide range of health, social and economic measures to be deployed in what they describe as “three nonlinear and interrelated phases: control, reactivation and reconstruction”.

Three overarching messages emphasise the measures proposed by the organisations to confront the pandemic:

“No economic opening is possible until the curve of contagion has been controlled, and reactivation is not possible without a clear plan to avoid a spike in contagion; health measures aimed at controlling the pandemic (including quarantine and social distancing) must be implemented in conjunction with social and economic measures aimed at mitigating the effects of the crisis, as this facilitates compliance with health measures; and rebuilding better implies promoting sustainable and inclusive development with equality at the centre, advancing productive transformation and creation of a state of well-being.”

Bárcena said advancing equality is essential for the effective control of the pandemic and for sustainable economic recovery in Latin America and the Caribbean.

“We must respond to the emergency and implement a strategy to overcome the structural weaknesses of economies and societies. Changing development strategy in the region is, therefore, essential.”

Dr Etienne said the region faces an unprecedented challenge, which requires solid and well-funded health systems to overcome this crisis.

“Investing at least six per cent of GDP in public health, with a particular emphasis on primary health care, not only protects achievements made in health but also ensures sustainable development and addresses rising poverty and inequality in the region..

“Health is a fundamental human right and access must be universal, with no one left behind. The health of both our communities and our economies depends on it,” Dr Etienne added.

The report says the measures proposed by PAHO and “rest on the need to coordinate health policies with economic, social and productive policies” and these include testing, contract tracing and public health measures such as quarantine and social distancing, as well as the strengthening of health systems, “with a focus on primary health care and ensuring compliance with essential public health functions”.


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