Foreign Policy Research Institute A Nation Must Think Before it Acts The Impact of COVID-19 in Latin America and the Caribbean
The Impact of COVID-19 in Latin America and the Caribbean

The Impact of COVID-19 in Latin America and the Caribbean

Few will escape the dramatic impacts of the COVID-19 global pandemic. Latin America and the Caribbean are no exception. The crisis occurs at a time of relative, but fragile, stability in the region. As such, democracy, governance, and economic conditions, as well as regional dynamics and international relations with the United States and extra-hemispheric actors, will experience significant shifts. In the Western Hemisphere, the pandemic presents an opportunity and challenge to U.S influence, and how this plays out will have enduring results for the world order.

Latin American and the Caribbean Partners—Relatively Stable, but Fragile

At the start of 2020, U.S. relations with Latin American and Caribbean countries were on the upswing, and democratic institutions in the region appeared to be improving. The “Pink Tide,” or a distancing from the United States by a handful of countries in the region that followed the leadership of Venezuelan dictator Nicolás Maduro by adopting increasingly undemocratic policies and reforms (Brazil, Argentina, Ecuador, Bolivia), had begun to recede. In the last five years, these countries elected leaders through democratic processes and were seeking renewed or closer diplomatic, economic, and military relations with the United States.[1]

In December 2019 and January 2020, the economic outlook for Latin America and the Caribbean projected slow growth, with many economies experiencing some of their lowest growth rates since the 2008-09 global financial crisis. The outlook was not stellar, but it was better than had been expected in previous projections. Despite positive trends in democratic governance and economic growth, popular unrest in the region expressed a general frustration and dissatisfaction with governments’ inability to meet increasing expectations. Improving economic indicators had not translated into improved conditions for a majority of the population. Tolerance of continued inequality, poverty, and weak institutions, coupled with region-wide corruption scandals (in many cases revealed by improving transparency and regulation), appeared to hit a breaking point in the second half of 2019. Unrest in multiple countries—including not only Venezuela, Nicaragua, and Bolivia, but also more stable countries, such as Ecuador, Peru, Colombia, and Chile—was cause for some concern regarding democracy in the region, undermining investor confidence and resulting in degraded economic projections. Unrest in Chile, focused on protesting subway fares, was particularly remarkable, as that country is generally seen as a model of democratic stability in the region. Additional areas of concern included Venezuela’s continued dictatorship, the humanitarian crisis caused by the flight of close to five million Venezuelan refugees (1.7 million of whom are concentrated in Colombia), and the rapidly increasing presence and influence of extra-hemispheric and undemocratic actors, such as the People’s Republic of China and Russian Federation.

Responses to COVID-19 in Latin America and the Caribbean

Concern over COVID-19 was slow to take root in Latin America and the Caribbean, where the pandemic’s development has trailed Europe and North America. Initial national responses varied in pace and scope, ranging from early strict containment and mitigation measures to a seemingly oblivious disregard of the pandemic’s grave consequences. Analysts contrast earlier measures taken by El Salvador, which restricted flights on January 25 before there were any cases in that country, with the actions of leaders in Nicaragua, Mexico, and Brazil. In Nicaragua, the president called for public marches against the coronavirus. In Mexico, the president insisted on holding and attending public gatherings, where he hugged and kissed participants, disregarding international health expert recommendations. Brazil’s leader publicly discounted the pandemic as a false hoax, even though a close staff member tested positive for the virus. By the middle of March, most countries in the region began to adopt measures recommended by health experts, to include banning flights from key countries, prohibiting large public gatherings, and suspending school. Not only have government policies and responses been uneven throughout the region, there has also been little to no significant regional collaboration to address the pandemic, which has infected nearly 45,000 patients in the region (where testing is available).

Regional Impact

COVID-19 effects on the global economy are expected to be worse than those of the 2008-2009 financial crisis, and in Latin America and the Caribbean, where 30% of the population lives below the poverty line and close to 12% live in extreme poverty, the effects will be catastrophic. This crisis will pose the greatest challenge in the health sector, where there is still limited coverage and access to healthcare, particularly for the region’s poorest and rural populations. Like elsewhere, hospital bed and respirator capacity is unlikely to meet the demand of this epidemic. In Venezuela, Haiti, and Honduras, the ratio of beds to patients is not even one bed per 1,000 patients. The ratio in Colombia, Peru, and Mexico is less than two beds. In Venezuela, the already existing humanitarian crisis and lack of healthcare is worsening—to such an extreme that the Maduro regime has offered to work with opposition President Juan Guaidó to confront the pandemic.[2] Venezuela’s humanitarian crisis will be especially difficult because of the global economy, the drop in oil prices, and the limited resources of neighbors to assist and continue to absorb of Venezuela’s poorest and those seeking medical care unavailable in Venezuela.

The economic effects will not only be far-reaching and long-lasting for the region, but recovery also will likely require assistance from outside it. Gross domestic product (GDP) is expected to contract at least -1.8%. Commodity exports and tourism, among principal sources of income for Latin America and the Caribbean, will experience significant shocks. The tourism industry and production and manufacturing sectors will be interrupted. Commodity prices and demand from countries, such as China, Saudi Arabia, and Russia, will decrease, and currencies will depreciate. Economic experts warn of the potential for the number of people in extreme poverty to increase from 57.4 to 90 million. With already high levels of inequality and poverty, a debt-to-GDP ratio higher than in 2008, and a constrained countercyclical ability to respond, the uncertainty of the pandemic duration and internal demand shocks will plunge the Latin America and the Caribbean into economic crisis. The region will not recover quickly from these humanitarian and economic crises without outside assistance.

Long-Term Implications for the United States

While the United States is the traditional donor nation and partner during crises in the Western Hemisphere, it appears to be fully engaged internally to confront the COVID-19 pandemic. The optic of U.S. Navy hospital ships docking in New York City and Los Angeles—formerly symbolic of U.S. aid to other less capable nations in crisis—communicates U.S. helplessness to the region. While the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) includes modest supplemental foreign aid funding and pending authorizations for international financial institutions to support the international response, it is overshadowed by focus on domestic crisis and response. The region may not see the United States as capable or able to be a source of help. Further, contradictory aspects of U.S. public messaging have enabled malign state actors to engage in disinformation campaigns that undermine the credibility of the United States, promoting narratives that: 1) the United States is no longer a global leader; 2) falsely identify the United States as the origin of the coronavirus; and 3) in the case of China, spin a story of Chinese superiority in handling the health crisis, coupled with offers of humanitarian assistance that would normally come from the United States, to include masks and ventilators.

One example is the late March visit by the Chinese ambassador to Argentine President Alberto Fernandez to discuss such an offer, which was enthusiastically welcomed by Fernandez’s government. China is now “leveraging its production of medical equipment and experience in dealing with the coronavirus as a soft-power tool in regions like South America,” where it has been gaining increased influence over that of the United States. One report observes,

From Argentina to Mexico, Brazil to Peru, Latin American nations have accepted offers of support from China as the number of coronavirus cases across the region has climbed, amid growing fears about the preparedness of their healthcare systems. . . . China’s aid to Latin America reflects a broader global trend, as Beijing looks to steer the narrative away from it being the country where the coronavirus started and was initially downplayed. Instead, China wants to be seen as spearheading the global fight against the pandemic.

While the U.S. has made available nearly $274 million in foreign assistance funding for the most at-risk countries, there has not yet been a focused effort to coordinate aid with regional governments, and the U.S. counternarrative to China’s messaging appears absent.

The COVID-19 pandemic in Latin America and the Caribbean will require multilateral response and aid to manage and recover from the crisis. The United States has always been the only country to offer significant aid and lead multinational humanitarian and crisis response efforts in the Western Hemisphere. For the first time since the 19th century, extra hemispheric powers are present and challenging U.S. influence and power in a significant way, as they offer to fulfill a leadership role. This challenge to the U.S. position and influence in its own hemisphere may have the most significant long-term implications for the United States as a global power.

The views expressed are those of the author and do not necessarily reflect the official policy or position of the Department of the Army, Department of Defense, or the U.S. Government.


[1] In Bolivia, adherence to democratic processes prevailed, forcing the ouster of President Evo Morales who, after nearly 14 years in office, was seeking another term beyond the constitutional two-term limit. Despite the fact that 2019 elections in Mexico and Argentina brought leftist leaders to the Presidency, there was still a sense of pragmatic optimism regarding democracy, rule of law, and continued good relations and cooperation on a range of issues. Even in Venezuela, the opposition to Maduro’s dictatorship has tried to reinstate democratic processes, transparency, and rule of law with broad international community support, to include that of the United States (thus far, to no avail).

[2] Juan Guaido was elected by the National Assembly as interim President until democratic elections could be held, but Maduro’s dictatorship has not released control of power (government offices and security forces).

The views expressed in this article are those of the author alone and do not necessarily reflect the position of the Foreign Policy Research Institute, a non-partisan organization that seeks to publish well-argued, policy-oriented articles on American foreign policy and national security priorities.