IMF: Latin America could go into recession

The International Monetary Fund highlighted the possibility that the region reaches this point, due to the consequences of the coronavirus

This Thursday, the International Monetary Fund (IMF) assured that Latin America may enter an economic recession as a result of the coronavirus.

The agency detailed that this viral outbreak, in addition to affecting thousands of human lives, will deal a severe blow to the services, oil, and transportation sectors, among others.

On his official blog, it warned of the global financial effects of the virus’s rapid spread, such as rising borrowing costs, which “will expose financial vulnerabilities that have accumulated over years of low interest rates.”

“The recovery that we expected a few months ago will not occur and a scenario of negative growth in 2020 is not ruled out” for Latin America and the Caribbean, said Alejandro Werner.

The head of the IMF for the region referred to the economic effects of the virus containment measures that are being adopted by the governments of the area, such as the closure of borders, schools and other measures of social distancing.

“These measures, together with the global economic slowdown and the interruption in supply chains, the fall in the prices of basic products, the contraction of tourism and the strong tightening of global financial conditions, are paralyzing activity in many Latin American countries seriously damaging the economic prospects of the region”, he said.

K. Tovar

Source: El Economista

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