Finding number 3 – Latin America is threatened by the coronavirus and weakened by the inequalities

(This article is the third of a series of five that look into the consequences of the coronavirus crisis on Latin America).

Latin America does not count as one of the poorest regions in the world, yet it has the highest levels of inequality. This has obvious and serious consequences on the public systems of health, their reactivity, as well as the efficiency of preventive measures that are being adopted.

Poverty has decreased between the years 2000 to 2014. From Mexico to Argentina, many assistance programs for the disadvantaged had then been put in place. Those tools were sustainable thanks to large incomes that were guaranteed by an exceptional export cycle (agricultural and energetical goods as well as mineral raw materials) and an unprecedented demand from China. Then, the decrease of the Chinese needs brought the selling of Latin American raw materials down, while the return to power of liberal-conservative governments called into question social programs. Besides, unilateral American sanctions on Cuba were reconducted, and they were even extended to the case of Venezuela. This caused adverse impacts on social indicators and publicly funded healthcare.

The Gini ratio, a tool used to measure differences in terms of income, rose as part of the population has shifted from the formal to the informal sector. According to the United Nations Economic Commission for Latin America and the Caribbean (CEPAL), in 2020, the number of persons living under the poverty threshold is expected to jump from 185 million to 220 million people. Data from the International Labour Office (ILO) indicates that between 2012 and 2018, the average part of the informal sector in Latin American countries has gone from 21,1% to 23%. The percentage of people that work in the informal sector ranges from 17% (Chile) to 62% (Bolivia) of the total labor force.

The already inadequate public health coverage in Latin American countries has worsened. Covid-19 added to other challenges, such as the existence of measles and the dengue fever. Regardless of quality, health coverage varies from one country to another in Latin America. Almost 100% of the population is covered in Costa Rica, Cuba, Columbia, Peru, and Uruguay; and more than 70% in Argentina, Brazil, and Panama. Whereas in Haiti, Guatemala and Honduras, only 49% to 65% of the needs are addressed. Generally speaking, the poor budget that is allocated to public health does not guarantee service quality. The basic capacities that are required for attending the ill such as hospital bed capacities, including those beds equipped for emergency cases, are rather deficient.

That said, statistics also vary considerably from one country to another. Cuba allocates 10% of its GDP to health expenses, and Guatemala 0.2% only. As a comparison, in the European Union, the average contribution to health expenses varies from 8% (Spain, United Kingdom) to 10% (Germany, France). In absolute value, for the year 2017, the average health expenditure per capita was $1,076 in Latin America and $3,364 in the European Union. Nevertheless, it is crucial to take into consideration the differences that prevail between such countries. In 2017, Cuba spent $2,486 per capita for health, compared to $1,917 for Argentina, $1,476 for Brazil, $395 for Honduras and $146 for Haiti.

The percentage of health expenditure brought to the GDP, and the number of beds available for every 10,000 inhabitants, come respectively as follows:

Argentina: 2.2% – 50 beds/10,000 inhabitants;

Bolivia: 2.4% – 11;

Brazil: 3.8% – 22;

Chile: 3.5% – 22;

Costa Rica: 0.6%;

Colombia: 3% – 15;

Cuba: 10% – 52;

Ecuador: 1.5% – 15;

Guatemala: 0.2% – 6;

Haiti: 0.7% – 7;

Honduras: 0.7% – 7;

Mexico: 1.6% – 15;

Nicaragua: 2.4% – 9;

Panama: 1,5%;

Peru: 1.4% – 16;

Dominican Republic: 1.2%;

Salvador: 0.7%;

Uruguay: 1.2% – 28.

(Source: El País América Latina and John Hopkins University).

The burst of the coronavirus, with respect to an already fragile social and health system, shook up the certainties of almost all of the governments of the region. Some of them reacted in an irrational way, others in a responsible way; the majority of governments reacted late, and others ended up using the health crisis for political ends.

Jean-Jacques Kourliandsky is a researcher on the Iberic world at the Paris-based Institute for International and Strategic Relations (IRIS). He is also the director of the Observatory of Latin America at the Jean Jaurès Foundation.

This article first appeared in French on the Observatory of Latin America at the Jean Jaurès Foundation.

To quote this article, please use the following reference: J-J. Kourliandsky (2020). “From COVID-19 to Latin America’s inequalities”, Observatory on contemporary crises, May 14, 2020, URL: https://crisesobservatory.es/from-covid-19-to-latin-americas-inequalities-j-j-kourliandsky/ 

This article is part of a series of five that look into the consequences of the coronavirus crisis on Latin America. To read the other articles:

How did the coronavirus reach Latin America? – J-J. Kourliandsky

Latin America, COVID-19, and the economy – J-J. Kourliandsky

From COVID-19 to Latin America’s inequalities – J-J. Kourliandsky

Latin America, COVID-19, and the art of political manipulation – J-J. Kourliandsky

Latin America, COVID-19, and the impossible quest for a consensus – J-J. Kourliandsky