News

More than 12 million Mexicans will fall into extreme poverty due to COVID-19, BBVA predicts

Advertisement
The COVID-19 pandemic will exacerbate extreme poverty in Mexico (Photo: Cuartoscuro)
The COVID-19 pandemic will exacerbate extreme poverty in Mexico (Photo: Cuartoscuro)

If Mexico have a economic contraction of 7% this year, as most national and international financial analysts and institutions predict, 12,000,000 Mexicans would enter in situation of poverty and 12,300,000 in extreme poverty, revealed this Thursday a analysis of BBVA Research, research area of ​​the financial institution.

Derived from the crisis generated the pandemic of COVID-19 globally and nationally, analysts of the financial sector anticipate that this 2020 the country will have a contraction economic of 7.6 percent.

On the other hand, on Monday, May 11, the National Council for the Evaluation of Social Development Policy (Coneval) spread a study in which estimated that if there is a contraction in the activity of 5.3% and one drop of 5.0% at per capita income from Mexican homes, up to 9.8 million more would be in income poverty and 10,700,000 new in situation of extreme poverty

Advertisement
.

"The estimates made by the Coneval are based on a conservative scenario where a GDP drop in Mexico of 5.3% by 2020, but the appropriate figures of the Inegi indicate that in the first trimester GDP may have been contracted 1.6%, which is equivalent to a decrease annualized of 6.2%, which points to the crisis by COVID-19 it can be a lot More accute than that observed in 2009, and possibly, of the last decades ”, he referred in the BBVA document.

Up to 12.3 million Mexicans will fall into extreme poverty in Mexico due to COVID-19 (Photo: www.bbvaresearch.com)
Up to 12.3 million Mexicans will fall into extreme poverty in Mexico due to COVID-19 (Photo: www.bbvaresearch.com)

In this sense, the institution of greater presence in the Mexican banking system, evaluated two scenarios with the processes developed by Coneval: one in which the activity has a decrease of 7% and other up to 12 percent.

READ  José Eduardo describes how Aislinn and Mauricio ended up

At First stage, I know esteem that population in situation of poverty by income could reach 58.4%, which represents an increase in 12 million people, while 26.6% of the population would be in a situation of extreme poverty, that is to say, 12.3 million more than Mexicans.

The second scenario, with a drop in the activity of 12%, would imply an increase of 16.4 million of additional people in situation of poverty by income, and an increase of 18 million people additional in condition extreme poverty by income.

In this context, the Economic Commission for Latin America and the Caribbean (Eclac) considers that Mexico could have a low in the activity of 6.8%, which would imply that 8,900,000 people enter situation poverty and 7,700,000 in extreme poverty.

ECLAC considers that Mexico could have a drop in activity of 6.8%, which would imply that 8,900,000 people enter poverty and 7,700,000 in extreme poverty (Photo: EFE / Juan Ponce Valenzuela / File)
ECLAC considers that Mexico could have a drop in activity of 6.8%, which would imply that 8,900,000 people enter poverty and 7,700,000 in extreme poverty (Photo: EFE / Juan Ponce Valenzuela / File)

Carlos Serrano, BBVA chief economist, said to The day that he social effect immediately due to the crisis of coronavirus It will be a increase at the levels of unemployment and therefore of poverty, faced with the new economic reality that it will face, which is why it could change "the social contract”Of Mexico to reduce the levels of inequality caused by COVID-19.

The country will face a new economic reality. It would be necessary to think that it is the moment to change the social contract, we know that the country has enormous inequalities and the pandemic will accentuate it, it would be necessary to make a collective reflection and take measures to reduce inequality, fiscal measures, improve contributions to pensions, measures to improve education and public health

BBVA anticipates a contraction punctual of 7% this year in the country, with an interval of a fall of between 6 and 12 percent.

READ  Bitcoin, Chainlink, Dash Price Analysis: 10 July

MORE ABOUT THIS TOPIC:

Coronavirus in Mexico today: around 11 million Mexicans could fall into extreme poverty due to the pandemic

Coronavirus in Mexico: 28 million jobs could be at risk from the pandemic

COVID-19 exacerbated social inequality in Mexico: civil organizations

About the author

Avatar

Sam Conley

Sam Conley is new to online journalism but she is keen to learn. She is an MBA from a reputed university. She brings together relevant news pieces from various industries. She loves to share quick news updates. She is always in search of interesting news so that she can share them as well to Sunriseread's readers who could enjoy them with their morning coffee.

Add Comment

Click here to post a comment

Quick Contact!

To get in touch with Sunriseread or to tell us about a Story or Press Release, just send an email to lindahopkins128 @ gmail.com
. And, we will get back to you shortly.