CORONAVIRUS: DEVASTATING

EFFECTS ON THE LATIN

AMERICAN ECONOMY
Name : JESUS YAIR SAAVEDRA ESPINOZA
 THIS ECONOMIC CRISIS IS DIFFERENT
FROM THE ONES WE KNOW SO FAR.
• Some companies will inevitably go bankrupt and unemployment will rise amid a crisis.
• Most of the countries have activated emergency plans

"There is a window of opportunity in the long term," says

Daniel Titelman, director of the Economic Development
Division of the Economic Commission for Latin America and
the Caribbean (ECLAC).
 1-ECONOMIC COLLAPSE OF ITS MAIN TRADING
PARTNERS: CHINA AND THE UNITED STATES

• The main trading partners in the region are China and the United States.
• The economic collapse in the United States affects the entire region
• And what happens in China is also felt immediately
2-FALL IN THE PRICES OF RAW MATERIALS

• The fall in the prices of minerals, the decrease in the price of foods
• And the one that has stolen the spotlight so far this year is petroleum.
• The fall in the price of raw materials causes less inflow of dollars from exports to the region and
puts the public coffers in check.
 3- THE INTERRUPTION OF GLOBAL
PRODUCTION CHAINS
• "As the world is closed, there is a disruption of supply chains," explains Titelman.
• "The bulk of world trade is in inputs that companies sell to each other, rather than the final goods
that the consumer buys," says Titelman.
4-LOWER DEMAND FOR TOURIST SERVICES

• The lower demand - and in some cases the zero demand - for tourism services, is leaving
countries that depend on this activity without oxygen.
• This is the case in several countries, such as Mexico, the Dominican Republic or Cuba.
 5-CAPITAL FLIGHT AND CURRENCY
DEVALUATION
• Latin America was already in high levels of debt before the pandemic hit.
• "People get scared and seek refuge, taking their capital to safer places, like the US Treasury Bonds," says Titelman.
• "Capital is leaving Latin America as we have never seen before," adds the economist."When you need financing the most, it is leaving
you.“
• The outflow of dollars has led to a gigantic devaluation of currencies so far this year, with spectacular falls in the Brazilian real, the
Mexican peso and the Colombian peso.
 CONCLUSIONS
• It is not easy to find a positive effect amid the devastating economic consequences of the pandemic.
• However, Titelman says that "there is a window of opportunity in the long term.“
• "There will also come a greater questioning of the globalization model," says Titelman, something that can
promote positive changes in the sense of how we have been doing things.