Coronavirus in Colombia: vulnerability and policy options
May 21, 2020
The COVID-19 pandemic poses complex policy challenges. The main challenge is to prevent a massive contagion that will collapse the health system while avoiding an increase in poverty and the destruction of the fabric of economic life. The need to respond to this challenge raises an additional concern: the fiscal viability of the measures required to reduce the harmful effects on public health and mitigate the economic losses generated by isolation measures.
In this document we present a brief description of the current situation in the Colombian economy and, based on this, we formulate policy proposals having three objectives: (i) Contain the contagion and adjust the health infrastructure. (ii) Mitigate the negative effects of the crisis on the incidence of poverty and thereby achieve compliance with care and self- care measures for living with the virus. (iii) Protect formal employment and help companies to survive.
Finally, we review the measures already implemented and announced by the government in these three dimensions, we analyze the relevance and possible effectiveness of these policies, we propose additional policy measures and, finally, we discuss the possibilities for financing these proposals.