Coronavirus
CARIB | Oct 23, 2020

‘Slow-burn’ impact of COVID on Caribbean economies will be devastating – IMF

/ Our Today

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Countries like Jamaica, Barbados and The Bahamas are dependent on tourism and closing borders is tantamount to enduring the constrictions of a medieval siege. (Photo: World Economic Forum)

By Al Edwards

The COVID-19 virus impact on Caribbean economies will be particularly devastating, putting even more pressure on existing structural weaknesses, says the International Monetary Fund (IMF) in its recently released World Economic Outlook: Western Hemisphere Report.

The IMF notes that the initial lockdown measures across the Caribbean curtailed the spread of the virus but, subsequently, governments have been unable to contain the virus.

“The lockdowns initially slowed the epidemic as mobility plummeted. However they were not able to contain the spread of the disease effectively as mobility started to rise.

“In fact the pandemic evolved as a ‘slow burn’ – a prolonged period of steady increase in new cases and deaths resulting in a high total death toll despite a notable initial decline in mobility.”

A major problem facing many of these countries is enforcing lockdowns with weak economies further decimated by the virus. Countries like Jamaica, Barbados and The Bahamas are dependent on tourism and closing borders is tantamount to enduring the constrictions of a medieval siege.

The cost of fighting COVID-19 is putting additional stress and strain on countries in the region. (Photo: IMF)

Testing, getting people to wear masks and social distancing have proved challenging and greater outreach programmes are needed across Latin America and the Caribbean (LAC). There are now roughly 230,000 confirmed infection cases across the Caribbean with more than 4,600 deaths.

The cost of fighting COVID-19 is putting additional stress and strain on countries in the region.

“The prevalence of poverty, informality in labour markets and the inability to practise social distancing in densely populated urban areas and crowded low-income neighbourhoods contributed to the rising death toll.”

World Economic Outlook: Western Hemisphere Report

The IMF is putting a lot of stock in prevention measures and calling for more robust health systems across the region but it is clear that many of these development states simply do not have that capacity.

“The prevalence of poverty, informality in labour markets and the inability to practise social distancing in densely populated urban areas and crowded low-income neighbourhoods contributed to the rising death toll. In addition, weak state capacity and the lack of fiscal buffers in many LAC countries hindered containment and mitigation efforts including through the failure to strengthen testing and tracing capacities,” wrote the IMF.

Mass testing appears to be beyond many countries in the region, so it is difficult to determine precise infection numbers. (Photo: World Food Programme Insight)

The region must make greater efforts to reduce transmissions but to do so runs counter to efforts to bring tourists – the lifeblood of many of these economies across borders and have them in close proximity to citizens of host countries.

Leaders have cited the importance of keeping their economies running and have concluded that their respective countries will now have to simply live with the virus. What is apparent is that mass testing seems beyond many of them, so it is difficult to determine precise infection numbers.

“As outbreaks become more widespread, poorly prepared health systems in the region came under pressure and failed to contain the human costs. The slow-burn dynamics in the region means still high marginal contagion and death rates which persist even today,” observed the IMF.

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