Latin America Faces Severe Recession, Growth Poised to Contract by 5.2% in 2020 - IMF

According to the Johns Hopkins University Coronavirus Resource Centre, Brazil has more than 25,700 confirmed COVID-19 cases, Colombia close to 3,000, while Peru has more than 10,300, and Ecuador has more than 7,600. The data also shows Venezuela with nearly 200 reported cases.

The countries of Latin America will face a severe economic recession due to the COVID-19 pandemic, according to the International Monetary Fund (IMF).

"The challenging external environment, coupled with much-needed measures to contain the pandemic, have led to a plummeting of economic activity across Latin America - where growth is poised to contract by 5.2 percent in 2020", the IMF said in a statement.

The current crisis, caused by the coronavirus outbreak, is the worst in almost 70 years since countries started producing national accounts statistics, the Fund added.

The IMF also commented on a possible economic recovery expected in Latin America next year.

"Given the dramatic contraction in 2020 and as countries implement polices to contain the pandemic and to support their economies - as emphasised in our previous blog - a sharp recovery in 2021 can be expected. Yet, even under this quick recovery scenario, the region faces the spectre of another 'lost decade' during 2015– 25", the IMF said.

The outbreak of the coronavirus pandemic has triggered an economic crisis this year as it has drastically reduced air traffic worldwide, shut down production, and forced many to work from home, driving demand for jet fuel and gasoline down.

The World Health Organisation declared the COVID-19 outbreak a pandemic on 11 March. To date, over 2.1 million people have been infected with the novel coronavirus worldwide, of which over 140,000 have succumbed to the deadly disease, according to Johns Hopkins University.