Surprise: Brazil's economy will collapse less than expected and President Jair Bolsonaro's popularity will remain almost intact. Despite an objectively superficial management of the health emergency, which is in the largest and most populous country in South America it caused 150.000 deaths out of 5 million infectedIndeed, it seems that the economic situation is not as bad as expected. This is certified by the International Monetary Fund, which has published estimates on the GDP of some Latin American economies: a month and a half ago Brazil was forecast at -9,1% for 2020, in line, for example, with the Italian decline; but the updated forecast almost halved the size of the fall, stopping the red at -5,8% for this year.
Already a slight recovery is even expected in the second half of the year, given that the figure for the first half is worse, around -7%. And above all already in 2021, as will happen almost everywhere, a rebound is expected, even if only by 2,8%. However, according to the IMF, the signals are not entirely encouraging: the country remains torn apart by social tensions and inequalities, which are accentuating during the crisis. Furthermore, to keep the GDP at this level and put in place the necessary social protection measures, Bolsonaro has drawn heavily on public coffers (public spending has reached a figure equal to 18% of gross domestic product), which will make the deficit to 12% this year, with public debt reaching 100% of GDP, a dangerous threshold.
It therefore seems paradoxical, especially seen from Europe, that the consensus for Bolsonaro is still so solid. Indeed, according to polls in recent weeks, the president in office since 2018 has more than consolidated his popularity: elected two years ago with 51% of the votes, he is now credited with 52%, after having dropped below 40% at the beginning of the pandemic. Now, however, the people have been reconquered in the meantime thanks to the huge economic aid in support of the poorest sections, which have finally been released after the initial promises. And then Bolsonaro recently opted for a less aggressive communication: even if the government still does not implement resolute measures to contain the virus, the president no longer goes around claiming that "it is a cold". And indeed a survey conducted by Datafolha found that 47% of the population do not hold the government responsible for the number of coronavirus deaths.
The hardest hit economy in Latin America, again according to the IMF, will instead be that of Mexico, which is the second largest after the Brazilian one. Although here too the forecasts are less pessimistic than the previous ones, the country governed by Lopez Obrador, a sort of "left-wing populist" who preaches austerity but winks at Donald Trump's United States, indicate a fall in GDP by 9 %, much worse than Brazil and barely better than the previously estimated 10,5%. In Mexico, the pandemic has so far recorded 800.000 cases and about 83.000 deaths, with 12 million people who have lost their jobs. Covid has ruined the plans of the president, who was counting on reaping the benefits of the new trade agreement with the USA and Canada in 2020.
