The current coronavirus pandemic has led, in many sectors, to accelerate certain processes that were already underway and will not go back. According to Diego Finchelstein, professor of the School of Business at the University of San Andrés and researcher at CONICET (National Council for Scientific and Technical Research), the clearest case has to do with the use of digital channels that in many cases are much more agile. This was already an on-the-fly transformation that the pandemic forcibly accelerated.
There are some elements that are presented as an opportunity for Latin American companies s after COVID-19, and in Latin America, some companies have started to identify. After China recovered from the epidemic it has faced since January, some of America’s leading industrial firms are looking to switch suppliers and began looking to Latin America.
All indications are that because China had to stop its productive activity for several weeks, value chains were interrupted. Faced with this desupply or lower flow of goods, several industries decided to change their strategy and diversify risk by expanding their supplier list. And for many American companies, Latin America is a good supplier, says the director of the Colombo Americana Chamber, María Claudia Lacouture. He mentions that the U.S. industries concerned include construction, textiles, technology, steel derivatives, auto parts, semiconductors, and more.
The IMF has acted quickly to support member countries through emergency financing. Of the 70 loans approved since the start of the pandemic, totalling USD 25 billion, 17 went to countries in the region, totaling USD 5.2 billion. In addition, access to the Flexible Credit Line for Chile and Peru was approved, and Colombia’s access was renewed. Together with Mexico, the total support provided to the region through the Flexible Credit Line amounts to USD 107 billion.
The IMF is prepared to use its financial capacity, policy advice, and training resources to help Latin America and the Caribbean achieve a stronger recovery.