Economies of Latin America at the epicenter of the coronavirus crisis

Yakovlev P.P.

Abstract

Сoronavirus was detected in Latin America a little later than it was in Europe, but very soon the Latin American region was at the epicenter of COVID-19. At the same time, the pandemic not only identified the most vulnerable parts in national healthcare systems in most countries of the region, but also played the role of an accelerator of the crises that have developed in the last decade and have placed Latin America at the epicenter of the coronavirus crisis. The shock that COVID-19 caused in the region motivated the business community and the political establishment to make a significant adjustment to the economic growth strategy and forced to introduce new elements into it. Two factors have become the most important in the regional macroeconomic policy: the digitalization of production processes and the technological renewal of a number of key industries that determine the place and role of Latin America in the global division of labor. First of all, we are talking about the energy and mining sector. The efforts made and the improvement of the global situation allowed Latin American countries to begin their way out of the crisis in 2021: regional GDP grew significantly, and exports increased sharply. These are encouraging facts indicating the emergence of new positive trends in the Latin American economy even in the extreme conditions of the coronacrisis. The problem, however, is that the formation of extremely important innovative trends associated with the spread of digitalization and advanced production technologies was not accompanied by the implementation of long-overdue institutional and structural transformations, as well as the necessary social reforms. This circumstance reduces the significance of the successes achieved and calls into question the prospects for Latin America to enter the trajectory of sustainable inclusive development.

Keywords

COVID-19; Latin America; healthcare problems; coronacrisis; economic recovery; digitalization; technological renewal; social reforms.

DOI: 10.31249/rsm/2023.01.06

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