…IDB says in report on Guyana

THE Inter-American Development Bank (IDB) said during a recent survey here, it found that the percentage of households earning less than the minimum wage increased from approximately 13 per cent in January 2020 to approximately to 45 per cent in April 2020 due to the coronavirus pandemic.

The bank, in its quarterly bulletin on the Caribbean on how the COVID-19 pandemic has been affecting economies, said that almost 60 per cent of households earning less than the minimum wage suffered job losses while around 16 per cent of households earning 11 times the minimum wage suffered job losses.

The bank also noted that the survey revealed that some households are struggling to cover some basic needs with 31.4 per cent of households earning less than the minimum wage reported going hungry in the past week and 55.9 per cent reported eating less healthy. These adverse effects remain prevalent but lower among higher income households, the bank said. The bank report noted that government responded to the crises by adopting a range of measures, which include: the suspension of all school activities for the year; closure of the two international airports; creating the National Coronavirus Disease Task to coordinate the government’s action plan; granting of special powers to the Ministry of Health to prevent and control the spread of the disease.

In addition, a National Plan of Action to counter the disease was formulated and government has built an Infectious Disease Hospital which is slated to be commissioned this week. Government has also directed rapid response to unexpected and emergency incidents; developed short term plans for disease prevention; and continues to communicate directly with agencies, ministries, regional task forces and stakeholders ensuring the protection of health and safety of the wider community.
The report by the IDB reviews the ongoing impact of the crisis for countries in the region, and provides recommendations for policymakers as they position themselves for a post-COVID-19 recovery. Recommendations include the importance of preparing for a broad resumption of travel and tourism, as well as the importance of bolstering capacity for debt management, broadening the social safety net, improving internet connectivity, as well as strengthening the capacities of emergency health services.
The report, Caribbean Quarterly Bulletin: The Pandemic Saga Continues, also includes detailed assessments for The Bahamas, Barbados, Guyana, Jamaica, Suriname, Trinidad and Tobago, and the countries of the Organisation of Eastern Caribbean States (OECS).

“While coronavirus curves had flattened and several airports reopened, the region still faces a treacherous transition to a post-crisis scenario,” said David Rosenblatt, the Regional Economic Adviser for the Caribbean Department of the IDB. “The path forward will not be an easy one as policymakers face social pressures, complicated fiscal situations, and a tough external environment. They will need to spend scarce resources efficiently, improve their debt management profile and attend to longstanding institutional challenges in economic policy.”

Put together by the team of economists of the IDB’s Caribbean Department, the study notes the decisive actions by governments in the region to stop the spread of COVID-19. On the economic front, however, conditions have worsened in recent months as big declines in tourism revenues start to take a toll, with some countries facing historic double-digit declines in GDP. The economic impact for countries that rely more on commodity exports will be less severe.

Using the recently launched Tourism Dependency Index (TDI) the report analyses Caribbean countries’ tourism dependency, and its implications for the post-COVID economic recovery. It notes that a dozen Caribbean countries (including The Bahamas, Barbados, Jamaica, and six from the OECS) rank in the top 20 globally on this index of tourism dependence. Prospects for a return to pre-crisis levels of tourism demand remain highly uncertain, as the economic impact of the crisis continues to affect travelers’ ability to reach Caribbean markets, as well as lingering concerns regarding sanitary conditions.

The Quarterly Bulletin uses a recent IDB survey of 12,500 households in the Caribbean to analyse the social impacts of the crisis. It sheds light on significant job losses and business closures for business owners in both tourism and commodity-dependent economies. For households earning less than the minimum wage, more than one in three respondents said they had gone hungry in the previous week. The report also recommends strengthening emergency health capacity and social safety nets. The pandemic has also brought to the forefront the need to improve internet connectivity and provide quality education.