The Strategist

Nearly 3M companies in Latin America will cease to exist due to COVID-19

07/03/2020 - 06:33

Nearly three million companies in Latin America and the Caribbean will cease to exist due to measures taken amid the COVID-19 coronavirus pandemic, according to a report by the United Nations Economic Commission for the Region (Cepal) on the effects of COVID-19.

“The vast majority of companies in the region recorded a significant drop in their income and have difficulty maintaining their activities, as they have serious problems with meeting their salary and financial obligations, as well as difficulties with access to financing. According to Cepal, over 2.7 million companies in the region will cease to exist by the end of the year. 2.6 million of them are microenterprises,” the study notes.

It is also about the loss of 8.5 million jobs, not taking into account reduction in employees in companies that will continue to work.

Among the most affected sectors, Cepal names trade, real estate, hotels and restaurants, individual industries and social services.

So, according to experts, the trade sector will lose 1.4 million companies and 4 million jobs, and the tourism sector - 290 thousand companies and a million jobs.