Mexico: Competing State Strategies and Results on COVID

By Piper Neulander*

Disinfecting city street in north-central Mexico./ Carl Campbell/ Flickr/ Creative Commons License

In the face of Mexican President Andrés Manuel López Obrador (AMLO)’s relatively cavalier attitude toward the COVID‑19 virus, the governors of states as varied as Nuevo León and Oaxaca have implemented contrasting approaches – with different levels of success and political gains. AMLO’s response has been colored by relatively late shutdowns, limited ramping up of national-level coordination mechanisms, and the maintenance of strict austerity despite an extraordinary decline in economic activity. Yet state governments have a large degree of autonomy in Mexico’s federal system, and some have taken advantage of it. Nuevo León – a northern, industrial, relatively urbanized and wealthier state – and Oaxaca – a southern, more rural and poorer state – both initially followed AMLO’s hesitant lead towards the virus, but eventually diverged in their strategies.

Nuevo León

The governor of Nuevo León, independent Jaime Rodríguez, has adopted policies that have departed sharply from federal guidelines. The state began to count private and state labs’ coronavirus tests together and quickly, while the federal government still only had one lab to officially confirm tests. It also used its own measurement system in many industries to allow for slower, safer re-openings – developing 12 measures, rather than the federal government’s four – and cooperated with neighboring states to prevent spread of the disease.

  • These policies gave Nuevo León a fighting chance to slow the spread through its dense population and industrial workplaces. Early testing meant the state had a far more accurate initial count of cases, and local processing of the tests enabled faster action. While these steps made Nuevo León citizens more aware of the spread within their communities early on, they caught medical workers unprepared for the surge, prompting protests over the lack of preparation.

Oaxaca

Oaxaca Governor Alejandro Murat, who aligns himself closely with AMLO, took advantage of that relationship during the pandemic. The state received federal help from the military to build much-needed hospitals in the region – one of which AMLO personally inaugurated during a tour of the Istmo region. (It was unclear, however, if the hospital actually began operating upon inauguration.)

  • This strong partnership with the federal government, however, made the state vulnerable to the same pitfalls as national-level policies, including inadequate testing and slow identification of virus trends, contributing to striking lethality rates from COVID‑19 in certain Oaxacan counties. The county of Juchitán, for example, experienced an 18 percent fatality rate.

In Nuevo León, Rodríguez saw a huge boost in popularity during the early months of the pandemic – an average of 25 percentage point increase in various polls conducted between March and May. His approval rate for his handling of the COVID crisis specifically was 72.3 percent in June – one of the five highest approval rates among Mexico’s 31 states. In Oaxaca, where polling figures vary, most pointed to a 6.6 percentage point increase in Murat’s approval rate between May and July. Also in June, opinion on compliance with isolation and decreased mobility was at 68.3 percent approval in Nuevo León and 60.6 percent approval in Oaxaca.

The governors’ political fortunes seem to parallel the states’ health results. Rodríguez was successful on two fronts: relative success against the coronavirus, and clear success in grasping the moment for his own political purposes. He was smart to forge his own path against the virus, focusing on essential tools like testing and regional cooperation, and, despite the health workers’ protests, delivering quality care to victims of the disease. Rodríguez was consistent and clear with the public about the risks of the virus, allowed his Secretary of Health to guide a response to the virus, and harnessed his urban, industrially supported state’s strengths in his response, while avoiding many of the mistakes of the federal government. In Oaxaca, Murat’s close adherence to AMLO’s lead placed the state at a disadvantage in combatting COVID‑19. While he did also gain in popularity for his response, the gain was smaller. Much of Oaxaca’s actions were boosted by support from the federal government, making the state-level response less distinguishable from Mexico’s central government strategy.

September 18, 2020

* Piper Neulander is a student in the School of International Service focusing on Latin America.

The Perils of Quédate en Casa: COVID-19 and Gender Violence in Latin America

By Brenda Werth*

Women performing "A Rapist in Your Path" holding up signs

A Rapist in Your Path – Brasília/ Mídia NINJA/ Flickr/ Creative Commons License (not modified)

Stay-at-home orders during the COVID‑19 pandemic have had a devastating impact on women in Latin America and brought mass protests against gender violence to a screeching, and troubling, halt. Since the foundational march of NiUnaMenos in June 2015 in Buenos Aires, Latin American activists have revolutionized protest against gender violence in a spectacularly public way, bringing together hundreds of thousands of women and allies on the streets of major cities to denounce gender violence and demand protection of gender, sexuality, and reproductive rights. Since its debut last November, the flashmob Un violador en tu camino (A Rapist in Your Path), created by the Chilean feminist collective Las Tesis, has been performed in more than 200 cities around the world, decrying the role of the state and police in perpetuating gender violence.

  • Even as the coronavirus began to spread, movements against gender violence continued to expand. In March, millions of women marched to commemorate International Women’s Day to demand an end to femicide and gender inequality. In Madrid, among the posters condemning gender violence were some declaring “The patriarchy kills more than the coronavirus.” By March 15, however, Spain was on lockdown, and by the end of the month most Latin American countries had instituted either partial or total lockdowns. Suddenly, slogans condemning gender violence and demanding gender equality were replaced by the urgent message for people to stay home: “Quédate en casa.”

The stay-at-home orders have had severe consequences for women across the globe. In Latin America, where seven out of 10 femicides take place in the home, the weeks following the institution of quarantines saw surges in the reporting of domestic violence, primarily against women, children, and LGBTQ individuals. Calls to domestic violence hotlines increased 40 percent in Argentina, 60 percent in Mexico, and over 90 percent in Colombia. Financial precarity, unemployment, and lack of access to child and eldercare all exacerbated preexisting gender inequalities, creating a “perfect storm” for domestic violence.

  • Quarantines have proven crucial and effective in countering the health threat posed by coronavirus, but they have left victims of gender violence trapped under the same roof with their abusers. One unintended effect of quarantine is the reinforcement of the perception of domestic abuse as a private, family affair, separate from the public sphere, and excluded from the jurisdiction of the state.

Government responses to the increased domestic violence in Latin America have varied tremendously, ranging from acknowledgment to denial of the crisis.

  • Elizabeth Gómez Alcorta, Argentina’s Minister of Women, Genders and Diversity, has issued a resolution explicitly allowing individuals to leave quarantine in order to seek assistance and protection against domestic violence. The Argentine government has also collaborated in building innovative campaigns blending awareness of both pandemics – gender violence and COVID‑19. The Barbijo Rojo (red mask) campaign refers to a code word women may employ when talking to pharmacists to let them know they are at risk of harm and unable to seek out help.
  • In comparison, denial has guided Mexican President Andrés Manuel López Obrador’s response. His government has failed to implement any major policy changes to address the increase in gender violence during COVID‑19, and he has maintained that 90 percent of calls to domestic violence hotlines are false. According to AMLO, Mexico does not have the same problem as other cultures with domestic violence because “the Mexican family is exceptional.” The government’s campaign to address domestic violence during quarantine, Cuenta hasta 10, asks family members to “count until ten” before expressing anger in the home. According to Lulú Barrera, the campaign lacks “gender perspective” by disregarding the structural causes of gender violence and ultimately puts women at risk by asking them to sacrifice their wellbeing to maintain peace in the home.

While the health pandemic has highlighted the dire need for movements like NiUnaMenos and messages like that of  Un violador en tu camino to continue and expand, stay-at-home orders have halted collective public mobilizations and forced women to return to the private sphere of their homes. The movements have radically transformed awareness and perceptions of gender violence over the last five years, but the current crisis, including the alarming increase in domestic violence, shows the gender-violence pandemic remains strong and could get worse. Protecting public health through stay-at-home orders should not neglect the need to protect women. Solutions must be jointly envisioned and enacted by public health experts, activists, and political leaders.

June 29, 2020

* Brenda Werth is Associate Professor and Department Chair, World Languages and Cultures, at American University.

Latin America: COVID-19 Challenges Higher Education

By Eric Hershberg, Alexandra Flinn-Palcic, and Christopher Kambhu*

Left: Classroom in Campinas, Brazil; Right: Universidad de las Américas, Puebla Library

Left: Classroom in Campinas, Brazil/ Wikimedia Commons/ Priscilla Micaroni/ Creative Commons License (modified) // Right: Universidad de las Américas, Puebla Library/ Wikimedia Commons/ Jose Alonso/ Creative Commons License (modified)

The COVID‑19 pandemic has worsened the challenges that Latin American universities already faced and could have a potentially catastrophic impact on higher education in the region.

  • Average gross enrollment doubled – from roughly one-fifth to two-fifths of the college-age population across the region – since the turn of the century, but budget constraints stemming from protracted economic stagnation have left institutions struggling to meet that growing demand. Annual GDP growth languished at 0.4 percent between 2014 and 2019, according to the United Nations Economic Commission on Latin America and the Caribbean (ECLAC). That forced painful cuts at state universities, and private schools have grappled with the stagnant incomes of tuition-paying households.

Due to COVID‑19, ECLAC now projects a regionwide decline in GDP of more than 5 percent in 2020 and forecasts that 29 million people will fall into poverty and 16 million into extreme poverty. To gauge the impact on higher education in the region, last month CLALS surveyed officials at more than 50 Latin American universities. (Read the full report.) More than half are in Brazil, where President Jair Bolsonaro has already slashed public university budgets, but the survey results show substantial adverse impacts throughout the region as well as deep trepidation about future prospects. Highlights our survey revealed:

  • Nearly three-quarters of universities have transitioned to some degree of online instruction since closing campuses in March, but 90 percent of respondents said that some students, because of socio-economic and territorial disparities, are having difficulty accessing the internet. Half of survey respondents considered that their institutions were “well-prepared” or “somewhat prepared” to make the transition, but half deemed their institutions to have been inadequately prepared. Fewer than half of the institutions represented had taken steps to address students’ need for connectivity, and in some instances, particularly in public schools, this gap was a factor in the decision not to move instruction online.
  • Most respondents believe that on-site classes cannot resume for some time; only a third at private institutions and a fifth at public institutions (mostly in Brazil) anticipate offering courses on campus through August 2020. As for the remainder of 2020, respondents were divided evenly on the prospects for reopening their campuses.
  • Fully 84 percent of respondents predict a drop in undergraduate registration, with half estimating a 10 to 25 percent decline. Predictions are only slightly better at the graduate level. Roughly two-thirds of the institutions surveyed host some international students, and of those, 60 percent of respondents from public universities and 30 percent from private institutions predict enrollment to decline by more than 50 percent.

Our survey leaves little doubt that Latin American universities are facing their greatest crisis in decades. Continued expansion of higher education institutions – one-quarter of which have been created since the early 2000s – now appears implausible.

  • Declining enrollments portend severe reductions in revenue. Half of respondents report cuts during the current fiscal year, and only one in 10 anticipate stable financing next year – with most expecting cuts of 10 to 30 percent. Hiring freezes are already widespread, and salary cuts loom on the horizon.

The responses to our survey may actually underestimate the depth of the dislocation in store. To re-open their doors, institutions will have to make substantial, unanticipated investments to ensure the safety of students and staff – reconfiguring facilities and developing testing and isolation protocols that will be extraordinarily difficult to implement.

Students will need additional support as the pandemic affects their families, campuses, and communities. Nearly three-quarters of respondents to our survey regionwide, and 96 percent in Brazil, indicated that their institutions provide psychological support services for students. There was virtually unanimous agreement – 96 percent – that these needs will increase over the coming two years.

  • An estimated 700,000 people in Latin America and the Caribbean have contracted the virus so far, and more than 35,000 have perished. In most countries these numbers are rising rapidly. In an increasingly bleak landscape, there is reason for concern that Latin America’s university sector may prove to be yet another victim of COVID-19.

June 2, 2020

* Eric Hershberg is Director of the Center for Latin American & Latino Studies and Professor of Government at American University. Alexandra Flinn-Palcic and Christopher Kambhu are Program Coordinators at the Center. Read the full report.

El Salvador: How Much has COVID-19 Hurt President Bukele?

By Héctor Silva Ávalos*

President of El Salvador Nayib Bukele

President of El Salvador Nayib Bukele/ Wikimedia Commons/ Creative Commons License/ Official Photography from the Presidential House of El Salvador

Salvadoran President Nayib Bukele – Latin America’s most popular leader one year into his presidency– has raised concerns about his Administration because of his authoritarian approach to governing and managing the COVID‑19 pandemic. He won kudos for his strong and early effort to stem the spread of the virus, scoring a 95 percent favorable rating in a recent La Prensa Gráfica poll. But the resulting economic downturn – and his obvious frustration at the need to engage in political give-and-take as he tries to respond – are fragmenting his alliances and highlighting his Administration’s weaknesses.

  • The anti-COVID measures that Bukele instituted back in March were among the first and most bold in Central America, winning him strong domestic and international praise. He closed airports and public schools, enforced isolation-in-place, and ramped up government assistance to hospitals and vulnerable citizens. As remittances from abroad to families in El Salvador nose-dived, a sustainable aid program became even more important.

The crisis has brought to light some of the President’s weaknesses as a manager and leader, however, and how he has compensated with increasingly authoritarian measures, such as a move to augment spending without Congressional approval, that have alienated many. In social media, he has cyber-bullied opponents, and critics report an increase in harassment by government authorities over taxes, labor practices, and other regulatory issues. He has pushed away former political allies in the country’s two strongest parties – ARENA and the FMLN – and thereby reduced his mobilizational capacity in both San Salvador and the departments. The President had resorted to such tactics even before COVID‑19 – he directed heavily armed police and soldiers to occupy the National Legislature back in February during a confrontation over budget issues – but the pandemic has sparked an escalation.

  • As the scope of the pandemic has hit home since March, Bukele has taken actions that, although conceivably attracting popular support, have drawn strong pushback. The Supreme Court overruled his attempt two weeks ago to unilaterally extend emergency measures that would allow him to continue unchecked public spending to deal with the pandemic. The Attorney General is also investigating whether actions by the President and senior staff amounted to criminal behavior.
  • Public protests have begun in forms appropriate for the age of social distancing – cacerolazos, car honking, protest music, and other signs of anger. International human rights groups have also begun expressing concern about the implications of the government’s rough enforcement of pandemic measures. Bukele directed police to be harsh against and detain individuals perceived as violating quarantine, even as they ventured out in search of food for their families. Amnesty International and others have criticized “arbitrary detentions and excessive use of force,” and Human Rights Watch has criticized Bukele’s “flagrant disregard of the role of the Supreme Court” and called on the Organization of American States (OAS), which has remained silent, to “push Bukele to respect the rule of law.”

El Salvador is now nearing one hundred COVID cases per day, and the public health system is pushed to the limits. The economy, which has already ground to a halt, almost certainly is sustaining long-term damage that will prove increasingly costly politically for Bukele. While his personal popularity has held so far, his honeymoon with the economic and political sectors upon whom he depends to move forward ended months ago and – short of a drastic overhaul in his approach – he seems likely to continue facing a number of challenges. In his most recent move, he got into a fight with Congress when the legislative body rejected his request to postpone the state of the union address scheduled for June 1. His staff keeps struggling with ARENA and the FMLN in Congress to pass one last amendment that would allow him 15 more days of unchecked spending to deal with COVID‑19.

  • The pandemic has laid bare a number of social, economic, and institutional problems about which Bukele could push a broad national debate aimed at driving reforms. Popular distaste for the business elites as well as ARENA and the FMLN give him space for such a venture. But, at least as evidenced in recent months, his concerns about his personal power seem likely to preclude any such initiative.
  • U.S. support for Bukele has been crucial and shows no sign of abating in the immediate term. But growing human rights concerns beyond the Administration of President Donald Trump, including among Members of the U.S. Congress, if not addressed, will become a liability.

May 29, 2020

* Héctor Silva Ávalos is a senior researcher and editor at InSight Crime and former CLALS fellow.

 

Latin America: Organized Crime Taking Advantage of COVID-19

By Carolina Sampó*

Favela in Rio de Janeiro, Brazil

Favela Villa Canoas, Rio de Janeiro, Brazil/Phillip Ritz/Flickr/Creative Commons License (not modified)

Latin American criminal organizations have faced some new challenges during the coronavirus pandemic – such as disruptions in transportation routes and markets – but they have also exploited opportunities to expand operations in ways that further threaten governments’ control in vulnerable communities.

  • Shelter-in-place controls in the region and the United States have complicated the groups’ most profitable business area: drug trafficking. Moreover, breaks in supply chains, especially those related to chemical precursors from China, have caused shortages of fentanyl, a synthetic opioid preferred by U.S. drug users, and ingredients used to make methamphetamines.
  • Trafficking of cocaine and other plant-based drugs has not stopped within Latin America, although some reduction in their movement to market has driven up prices somewhat. Quarantines have posed new difficulties for transportation, but traffickers usually avoid legal border crossings and pass through areas with no or minimal government presence anyway. Governments have also moved detection and interdiction resources elsewhere. Brazil, as the region’s main consumer, still seems to be receiving regular shipments of cocaine.
  • Shipping drugs outside the region has been more difficult because airports are closed and commercial ship traffic has declined, but criminal organizations have accepted to run the risks of continuing their own maritime activities, which raises the price to consumers. Authorities say that cocaine shipments tend to be large – over one ton – and narco-submarines are being used.

Supply and demand have both declined during the coronavirus outbreak, but prices of meth and synthetic opioids have risen considerably – some even tripling in recent weeks, according to U.S. official sources. Demand from consumers of illicit drugs at parties is down with the implementation of social distancing, but dealers in food delivery services are distributing their merchandise directly to users’ homes. Supply and demand seem to be balanced, but dealers are charging higher prices for their enhanced service and greater risks.

As in the past, criminal organizations are showing high adaptability. International experts report the groups are increasingly getting involved in cybercrime. They have also been caught peddling counterfeit medical items. Interpol has seized substandard masks and sanitizers as well as drugs the gangs claim will help people combat the virus. The pandemic has also enabled criminals to deepen their ties with vulnerable communities, such as by providing essential goods and services.

  • They are consolidating criminal governance in the communities where they play the role of social order providers. In the slums in Rio de Janeiro, for example, the criminal organizations have been the ones to enforce lockdowns to stop the spread of COVID‑19. Where criminal organizations cannot guarantee social order, they use violence or cooptation to establish territorial control. And they continue efforts to expand prison control, using jails to recruit members and build their power base. During the coronavirus outbreak, the gangs have organized riots and jailbreak attempts in Argentina, Brazil, Colombia, Peru, and Venezuela. Power in the prisons projects into power on the streets.

The pandemic has forced governments to prioritize resources on the health and economic crises it is causing, and efforts to control criminal organizations have by necessity been more lax. The gangs are also scrambling to return to “normalcy,” but they are again demonstrating greater adaptability than are the governments.

  • Governments have no easy solution. While organized crime is diversifying its portfolio of activities, reinforcing its territorial control, building its prison base, and recruiting new members – exploiting the economic and social situation – governments have little choice but to beef up efforts any way they can domestically while paying special attention to cooperation with neighboring countries facing similar challenges, in hopes of hemming in the criminal organizations. It is a huge challenge – against difficult odds – but perhaps the pandemic also gives governments a one-time opportunity to hit the gangs at a time that they face challenges too.

May 22, 2020

* Carolina Sampó is Coordinator of the Center for Studies on Transnational Organized Crime (CeCOT), International Relations Institute, La Plata National University, and a researcher at the National Scientific and Technical Research Council (Conicet) and Professor at the Buenos Aires University.

Central America and the Pandemic: Different Priorities and Risky Bets

By Alexander Segovia*

Presidents of Central America participate on a SICA virtual meeting

Reunión Extraordinaria de Presidentes del Sistema de la Integración Centroamericana (SICA)/Flickr/Creative Commons

In most Central American countries, the social dimension of the COVID‑19 emergency has competed with economic priorities, and in some it hasn’t even been a top priority. Governments have responded independently of one another, showing little regional coordination aside from a $1.9 billion Regional Contingency Plan approved by the Sistema de la Integración Centroamericana (SICA) and funded by the Central American Bank for Economic Integration (BCIE), to support national-level efforts.

El Salvador has designed a response strategy that prioritizes the health dimension of the crisis, not the need for economic recovery. The rigorous implementation of stay-at-home and social isolation measures has caused a number of problems, including essentially shutting down the economy, with enormous political costs. The Legislative Assembly authorized the government to issue coupons worth $3 billion to help families get by, causing a significant increase in the country’s external debt and fiscal deficit.

  • The Salvadoran response has been well-received by the population so far, but this could change quickly in the face of the high economic and social pain it has caused. Moreover, the authoritarian and militarist way the confinement regulations have been enforced, and the government’s lack of respect for the Constitution and the separation of powers, have also troubled many.

Nicaragua is the opposite case of El Salvador. The government has refused to adopt social isolation measures and has encouraged people to take to the streets and participate in large events. The Ortega Administration’s concern is about the economy, which has been in a deep crisis since the social protests in 2018 and the government’s repressive reaction to them. This priority partly explains the government’s resistance to implementing shelter-in-place and social-distancing regulations.

  • The government is playing with fire. If the health crisis spins out of control, it will cause both a great loss of human lives and a profound socio-economic crisis – which sooner rather than later will spark a social and political crisis of massive proportions.

Costa Rica, with its good universal health care system and the region’s most developed state infrastructure, is best prepared. Its initial response to the health emergency was slow and permissive, reflecting a government decision to confront the crisis in a manner that causes the least damage possible to the economy. It has since acted more decisively and has suffered only 10 deaths from COVID‑19.

  • Costa Rica is the only country in the region trying to finance the additional costs by reducing non-priority public expenditures and by introducing a temporary solidarity tax on capital gains and on the salaries of higher-paid managers in government and the private sector, who have economic security and safe jobs.

Guatemala is implementing a response in which the health emergency is competing with leaders’ desire for economic recovery. This reflects the enormous influence over the government and Congress enjoyed by the economic elites, who hold sway over public policies and have a veto over any that affect their interests.

  • By putting the social and economic challenges on an equal plane, the elites have demonstrated, in what they see as a politically correct way, their ability to equate human life with the accumulation of capital.

Honduras has implemented a strategy that gives insufficient attention to the health crisis by assigning higher priority to containing the economic impact. Its response has been fragmented and confusing; it combines emergency measures with economic recovery actions that will take effect only in the second half of the year. In addition, policymaking processes have been opaque, and there are no guarantees that public funds will be used transparently.

  • Concerns that the crisis has also given rise to greater militarization of the country and an increase in human rights violations by security forces are also mounting.

The best way for Central America to confront the COVID emergency is through energetic responses focused on containing the health crisis – with effective stay-at-home and social-distancing measures – and strengthening of social protection systems and programs, including direct financial payments to households. These policies should be backed up with broad political and social agreements and sustained with absolute respect for democracy and human rights.

  • Preliminary evidence indicates that, while addressing the health crisis has high costs in the short term, delaying that investment increases the number of deaths and leads to a deeper and longer economic crisis. Central American governments and economic elites have a clear choice: pay a smaller price now combatting the virus, or pursue short-term benefits and pay a much higher price in the long run.

May 20, 2020

* Alexander Segovia is a Salvadoran economist. This blog article is based on and updated from an analysis originally published here by Análisis Carolina in Madrid.

Ecuador: Growing Political and Economic Repercussions of COVID-19

By John Polga-Hecimovich*

Lenín Moreno speaking at an event

Lenín Moreno, presidente de Ecuador/Flickr/Creative Commons

Despite early aggressive measures against COVID‑19, Ecuador has suffered one of the world’s most devastating outbreaks that, combined with the drop in international oil prices, may be catastrophic for the country’s economy and for President Lenín Moreno. Since March 16, the President declared a national state of emergency and curfew throughout the country; imposed strict social isolation (until May 4) that suspended all face-to-face activities; and established a special security zone in the province of Guayas, epicenter of the pandemic. Even so, Ecuador currently has the second-highest number of documented cases in South America, after Brazil, and the death toll from COVID‑19 may have reached between 7,600 and 11,000 during April.

  • Ecuador’s first case of COVID-19 was detected on February 27 in the port city of Guayaquil. As the virus spread in March and early April, the city experienced an unprecedented humanitarian crisis due to the much-publicized accumulation of hundreds of corpses in homes and on the streets. The local government’s response was erratic, with mayor Cynthia Viteri at one point ordering officials to block the runway at the airport to prevent a flight from Spain from landing, and later comparing the devastation to “the Hiroshima bomb.” Viteri has since estimated that perhaps as many as one-third of guayaquileños have COVID‑19.

Despite the lockdown measures, the national government has also shown a lack of capacity in addressing the public health crisis. Moreno created a task force to deal with the situation in Guayaquil, but even then, the government possessed a limited ability to determine who had the virus, to say nothing of addressing shortages of suits, masks, gloves, and ventilators for hospital personnel. In a national address in early April, the President acknowledged that official coronavirus figures had significantly understated the extent of the country’s health emergency. There have also been worrying accusations of corruption against officials in the Ecuadorian Institute of Social Security (IESS) in outfitting hospitals, and the Attorney General’s office charged the now ex-National Secretary of Risk Management Alexandra Ocles with influence-peddling.

  • The combined impact of the pandemic and oil crisis on the country’s economy may be catastrophic. Petroleum is Ecuador’s largest export commodity and accounts for about a third of its public-sector revenue. The 2020 national budget was planned with an oil price of $51.30 per barrel (currently hovering around $30.00), which will increase the country’s deficit. Ecuador also has little savings to implement a countercyclical fiscal policy and is on the brink of defaulting on its $50 billion debt. Adding to the troubles, due to dollarization, it cannot devalue its currency to reduce its deficit. The collapse of export revenues and massive foreign debt payments have greatly compounded the economic cost of the pandemic, and the country’s GDP may shrink by as much as 7-8 percentage points.
  • The government is just barely muddling through. Private bondholders have accepted the government’s request to defer interest payments on the country’s debt until August 15, freeing up $811 million and buying Moreno some breathing room. However, this could merely postpone a default: a fragmented and intransigent legislature and social sectors have balked at emergency austerity measures. Responding to the country’s social needs and economic well-being is a difficult line to walk. The government has issued a $60 stimulus (bono) that will benefit some 400,000 people, while at the same time it submitted a bill to the National Assembly that proposes an extraordinary tax on both companies and individuals to bring unbudgeted resources into the national treasury.

While the government confronts its public health and economic problems, general elections are nine months away and the National Electoral Council is already debating ways to carry them out. There is too much uncertainty at the moment to determine any potential frontrunner. Moreno is not running for re-election; ex-Guayaquil Mayor Jaime Nebot has suffered due to his city’s lack of preparedness at confronting the pandemic; and the fate of Interior Minister María Paula Romo may rest on the Moreno government’s (so far unconvincing) response. Like leaders around the globe, Moreno is faced with the unpleasant challenge of keeping the country’s economy shuttered longer or risking a resurgence of the virus. The success or failure of his strategy will undoubtedly shape the country’s political and economic future.

May 15, 2020

* John Polga-Hecimovich is an Assistant Professor of Political Science at the U.S. Naval Academy. The views expressed in this article are solely those of the author and do not represent the views of or endorsement by the Naval Academy, the Department of the Navy, the Department of Defense, or the U.S. government.

COVID-19 in the Caribbean: So Open, so Vulnerable

By Bert Hoffmann*

rows of empty beach chairs in Jamaica

Beach in Jamaica/ Marc Veraart/ Flickr/ Creative Commons License (not modified)

In the Caribbean, the COVID-19 crisis hits some of the world’s most open, specialized economies, forcing the region to rethink its development model. Eleven of the world’s 20 most tourism-dependent nations are in the Caribbean. The collapse of this sector leaves the import-dependent island states extremely vulnerable beyond the immediate health crisis and beyond the social and economic fallout from the current “shelter in place” rules and lock-down measures.

  • For most Caribbean nations, tourism is by far the most important economic activity. In small states like Barbados, St. Lucia, Antigua and Barbuda, and the Bahamas, tourism makes up more than 40 percent of GDP. In bigger countries like Jamaica, it accounts for more than half of exports and employs almost a third of the workforce. Many in the tourism industry cling to hopes of a speedy recovery, but this is not likely. Travelers’ confidence in cruise ships and exotic flight destinations will not fully rebound before vaccinations against the virus become readily available. Not only the low season this summer is lost, but also much of the crucial winter season.
  • The pandemic is also going to slash remittances from Caribbean emigrants. Most states have sizeable diaspora communities, and money transfers from abroad are a vital part of their economies. Unlike in the aftermath of hurricanes, migrants in the United States, Europe, or neighboring islands are affected by the same crisis. Many will also cancel visits “home.”

Current social policy measures may be able to mitigate some of the hardship, but foreign exchange buffers are hardly sufficient to maintain these on such a scale over a long time. Largely agricultural countries decades ago, most of the region today imports more than half the food they consume – seven CARICOM countries even more than 80 percent. With global supply chains and food production in the United States disrupted, imported food prices will rise. Reviving local farm tradition passes from a “romantic” niche concern to being a key issue of social policy.

  • In the Caribbean’s non-sovereign territories, the crisis underscores their population’s dependence on the welfare systems of the United States, France, the UK, and the Netherlands. At the same time, it casts a spotlight on persisting inequalities. Puerto Rico, for instance, has only one-fourth of intensive care unit beds per capita than the U.S. mainland, despite its much higher share of elderly residents.

The coronavirus crisis is bringing to the fore a number of long-term challenges for the Caribbean. If left solely to the logic of comparative advantages, the region’s world market integration tends to be one of specialization, not diversification. The downside is a high vulnerability to external shocks. In recent years, “resilience” became part of the vocabulary of Caribbean policymakers in the context of climate change, not to face global economic or health shocks. The current crisis demands thinking of “resilience” as a development goal in an even broader sense.

  • The pandemic also highlights the extent to which the Trump Administration takes the United States out of the game of soft policy approaches, and China finds a field left wide open. Beijing’s shipments of medical supplies and protective wear are a small investment, but they have a big impact in countries of some 100,000 inhabitants. Taiwan is also providing face masks and soft loans to those that still recognize it diplomatically. In contrast, what Washington seems to care about more than anything else is that the Caribbean nations should not accept Cuban doctors in to fight the disease.

April 20, 2020

* Bert Hoffmann is a Lead Researcher at the German Institute for Global and Area Studies (GIGA) and professor of political science at the Free University of Berlin’s Latin American Institute.

Cuba: Dealing with the Global Pandemic

By Ricardo Torres*

Cuban nurses carrying the Cuban flag

COVID-19 Response: Over 100 Cuban Nurses Arrive Barbados / Flickr / Public Domain

Cuba faces a “perfect storm” – a global health crisis – that poses the latest in a long list of challenges to its government, but a systematic destabilization of the country is highly unlikely, if not remote, for now. The COVID‑19 pandemic has caused an unprecedented disruption to the world economy, the devastating effects of which no country has escaped. The Cuban economy is critically dependent on tourism and remittances, two areas that have been deeply affected. Those countries from which visitors and cash flow to Cuba are greatest – the United States, Canada, Western Europe, and China – have been hit hard.

  • The shock is compounded by a drop in Cuba’s average annual growth from 2.7 percent in 2010‑15 to 1.4 percent in 2016‑19. The causes of that decline include the economic crisis in Venezuela; the cancellation of medical services agreements in Bolivia, Brazil, and Ecuador; the end of the international tourism bonanza; and the effect of new U.S. sanctions. Washington’s actions have complicated trade, foreign investment, and travel. The measures have limited remittances, reduced Cuba’s ability to import fuel, and clamped down on foreign firms operating in Cuba, such as through the first application of Title III of the “Helms-Burton Act.”
  • Another factor has been the disappointing results of Cuba’s internal economic reform, which has been wrapped up in political contradictions and a lack of clarity of its objectives. One costly flaw in these circumstances has been the government’s inability to stimulate industries that provide essential products, particularly food. Combined with the international challenges, including fresh, tough sanctions by the United States, this problem has contributed to a situation in which the Cuban people face growing shortages of all kinds of products, including food, medicines, and fuel.

The government’s response to COVID‑19 has evolved from caution to the gradual imposition of increasingly radical measures.

  • In mounting a medical response, the centralization and verticality of the Cuban model allows authorities to adapt plans and resources in the face of new priorities. The Cuban health system, for example, is known for its national coverage and access to resources (including 848 doctors and 5.5 beds per 100,000 inhabitants), and it has experience dealing with epidemics. Decisions have been taken around the concept of epidemiological vigilance, including closing the borders on April 2 and bolstering research, although the inability to carry out massive testing has been a weakness. The government has also guaranteed workers’ income and employment, except for parts of the private sector and informal economy, and expanded food-rationing to a broader list of products.

The economic impact in the medium term should not be underestimated. GDP growth will enter negative territory. Financial problems will surely deepen. Shortages of an array of basic necessities are going to worsen. Restructuring of foreign debt is necessary.

  • Internally, Cuban policymakers are going to have to take into consideration the new socioeconomic structure of the country and the need to focus support where it’s needed most. The crisis provides a good opportunity to give substance to longstanding rhetoric about improving agricultural production. Greater flexibility in regulating private businesses is also an obvious policy option. Accelerating and broadening digital access throughout society should also be a priority under the wisdom of “not putting off till tomorrow what can be done today.”

The Cuban Government is not presiding over a terminal crisis, however. Even considering the system’s weaknesses before the pandemic, this perfect storm is not its responsibility. For the medical challenge, Cuba is prepared and probably will overcome some of the criticisms made abroad about its medical missions, as brigades of Cuban doctors deploy to 19 countries. The country’s biotechnology industry also stands to make advances. It’s too early to say whether Cuba will be able to profit from these opportunities, but Havana may benefit from its willingness and ability to be a responsible international partner.

  • Washington’s policies also put it in sharp contrast with China, which continues to provide help during these difficult times. If the pandemic has made anything clear in Cubans’ minds, it’s that the United States is disqualifying itself as a positive force for change on the island.

April 17, 2020

*Ricardo Torres is a professor at the Centro de Estudios de la Economía Cubana at the University of Havana and a former CLALS Research Fellow.