The Inter-American Development Bank (IDB) on Saturday predicted that economic recovery in Latin America and the Caribbean would be difficult following the defeat of the (Bogota) pandemic.
“The region is emerging from the crisis with greater poverty, greater poverty and increased income inequality,” said the multilateral body, which has been meeting in Colombia since Wednesday for its annual meeting.
The “shock” caused by massive unemployment also contributes to an increase in extreme poverty, which falls from 12.1% to 14.6%, affecting tourism-dependent countries and raw material exports. Especially exposed.
But the IDB warns that the future of the region will depend largely on reforms undertaken by governments to reduce the health emergency.
With just 8% of the world’s population, Latin America and the Caribbean account for 25% (733,000) of all coronavirus deaths.
After a historic 7.4% decline in regional gross domestic product last year, the IDB has projected economic growth of 4.1% in 2021, giving immunity to countries based on “growth potential” of 2.5% in subsequent years and imposing no new limits.
She sees “negative growth” based on slow economic growth in the United States and Europe, the appearance of new variants and the slow departure from vaccines.
To avoid this catastrophic situation, IDB urges countries to take steps to increase productivity, regional value chains, digital economy and comprehensive job creation, in addition to the immediate economic reforms that threaten the region, especially those that threaten to slow climate change. .
To stimulate recovery, IDB needs new resources, its president Mauricio Clover-Caron said Saturday.
“Current resources are insufficient.” IDB needs to “consider recapitalization” to play its role in the region’s revival, not to mention the amount needed,