As a result of non-compliance with biosecurity protocols, the increase in the number of cases and the saturation of hospital capacity, Phase I of the Intelligent Opening Process was suspended.
On June 8, business activities began to restart. However, the increase in the number of people infected forced the authorities to back off and cancel the start of Phase I, a decision that was communicated on June 21.
The World Bank projects that the Central American economy will contract by 3.6% this year, due to restrictions on movement, a decline in remittances and tourism, and a drop in agricultural prices.
The sudden and widespread impact of the coronavirus pandemic and the measures taken to contain it have caused a drastic contraction in the global economy, which, according to World Bank forecasts, will shrink by 5.2% this year, the bank reported on June 8.
Structural changes in world trade, consumer preference for living on the outskirts of cities and a growing demand for technological equipment to be able to work from home are some of the turns economies will experience in the new reality.
Most companies globally have been focused on understanding the new business environment, which derives from the change in the ways people relate to each other as a result of the covid-19 outbreak.
In the context of the tense diplomatic and commercial relationship between the two world powers, Central American countries could have the opportunity to attract new investments, as it is estimated that some American companies would need to migrate their operations to the American continent.
As a result of the tension between the two nations, Mauricio Claver-Carone, an advisor to President Trump, believes that U.S. capital, which currently generates thousands of jobs in China, will turn south of the U.S. borders.
Discounts and offers, increase in the price level generally and the rise in operating costs due to new health and safety protocols are the main threats to the profitability of companies in this new commercial reality.
Given this context of economic and health crisis, which derives from the outbreak of covid-19 at the global level, Ariel Baños, a specialist in price management and founder of Fijaciondeprecios.com, explains what are the main threats that could affect the profitability levels of companies, and details some strategies that could be applied to mitigate the adverse effects.
Including the respective prevention protocols to avoid the spread of the virus, cinemas, beauty salons, auto parts sales, non-contact sports training centers, gyms and swimming schools will be able to open to the public as of May 1st in Costa Rica.
The protocols must be constructed between the institutions and the respective sectors, who may send their proposals to the Ministry or Executive Presidency as appropriate, reported the Ministry of Health.
When the local economy begins to return to the new normality, as isolation and mobility restrictions are relaxed, it is estimated that the demand for electricity by Honduran households will have decreased by 11%.
Using a demand/income sensitivity model developed by the Trade Intelligence Unit of CentralAmericaData, it is possible to project the variations in demand by Honduran households for different goods and services as the most critical phases of the spread of covid-19 are overcome and the measures restricting mobility in the country are lifted.
Given the crisis in the region, businessmen in Guatemala report that smuggling of Mexican products has increased, while in Panama, beer producers attribute the rise in illegal trade in alcoholic beverages to the dry law.
With the spread of Covid-19, governments in Central America have decreed mandatory quarantines and have also restricted the movement of consumers at certain hours.
Financial Intermediation, and Manufacturing Industries, largely determined the 2.5% increase in GDP during the fourth quarter of last year, compared to the same period in 2018.
Financial Intermediation, Insurance and Pension Funds increased 1.7%, boosted by income received from commissions and interest on the loan portfolio, reported the Central Bank of Honduras.
In contrast to the measures taken by some neighboring countries, the government reported that at the local level, charges for water, electricity, Internet and telephone services will not be suspended.
Authorities argued that at the moment it is not possible to postpone payments, as few basic services are provided by the government in the country.
Once the Central American economies begin to return to normal, as the restriction and quarantine measures that have been taken to prevent the spread of the covid-19 are relaxed, household consumption patterns will have changed significantly.
For example, the demand for meals out of home will decrease by about 7% from the levels reported prior to the crisis.
Explained by the behavior of the Financial Intermediation, Insurance and Pension Funds, and the Manufacturing Industry, during January the Monthly Index of Economic Activity increased by 3.8% with respect to the same period in 2019.
Most of the productive activities showed positive results in the first month of 2020, standing out for their contribution to the global indicator: Financial Intermediation, Insurance and Pension Funds; Manufacturing Industry; Post and Telecoms; and Commerce, informed the Central Bank of Honduras.
Reducing the Monetary Policy Rate to 4.5% and temporarily suspending the daily auctions of Bills aimed exclusively at financial institutions are some of the measures taken by the Central Bank of Honduras in response to the spread of the covid-19.
Faced with a domestic and external context of greater uncertainty and volatility, the Central Bank of Honduras (BCH) established a set of monetary policy measures in order to continue flexibilizing financial conditions that allow the private financial system to have liquidity to meet the needs of the population at this time of high demand, the institution reported.
After the first case of covid-19 was reported in the country, the private sector is asking authorities to close the borders partially or completely and to have people entering the nation examined and quarantined if necessary.
Jose Adan Aguerri, president of the Superior Council of Private Enterprise (COSEP), explained that among the measures taken by the companies for this emergency is the creation of a critical department so that the companies that the staff is working in three different places in case any of them is affected, have guns to measure the temperature of customers who come to the company and not allow them to enter with fever.
In Central America, it is estimated that the sectors that could expect a severe impact on sales in the coming months are Transport, Entertainment and some sub-sectors of Industry and Trade.
The "Information system for the Covid-19 Impact Analysis on Business", prepared by the Trade Intelligence Unit of CentralAmericaData, measures the degree of impact that the crisis will have on companies according to their sector, during the coming months.
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