Massive apologies, we just had some slight technical difficulties that they were getting there, but thanks so much everyone for joining.  This webinar is part of a series that's being organised between the Swiss Economics Department and the Open Economics Forum. So the Open Economics Forum is a student society at SOA. We're aiming to promote pluralism within economics and we're also a part of the wider Rethinking Economics Network, in case you're proud of that. So firstly, I'd just like to say a big thanks to everybody who's been involved with organising both people within the OEF and within the Economics Department. Like I say, this is part of a wider series, so it's the third event. So if you'd like to keep updated and keep following it, please take a moment to follow our social medias. You can find us on Facebook at SOA's Open Economics Forum or also on Twitter, that's at OpenEcon Forum. You can also follow the SOA's Economics Department at SOA's Economics. If you'd like to join the conversation online, please use the hashtag economicsofcovid. So we can continue having discussions as we go along. So my name is Alice Malavoie. I'm a master's student within the Department of Economics. I'm also a member of the Open Economics Forum. Today we will be talking about COVID-19 and economic development in Latin America. So it's really exciting. It's our first sort of regional look. And today we have V.S. Franz, who is a lecturer in economics at SOA's, who has research interests within the region, particularly Colombia. So today he's going to give us a look at the context pre-crisis and some of the effects of COVID in this area and how we can start looking to move forward. If you've joined us before, you'll be familiar with the structure. Tobias will speak for 25, 30 minutes and then we will open it up to questions from all of you. So I'll strongly encourage all of you to start sending your questions in the chat box, which you can find to the right-hand side. And hopefully we can have a really great discussion afterwards. And just so you're aware, this session will be recorded. And I think that is everything from me. So I hand over to Tobias. Hey, thanks, Alice, for this. And again, also thank you to the Open Economics Forum and the Department of Economics for organizing this series. As you said, I will first go over the context of where Latin American economies were before the start of this economic crisis that was triggered by the spread of COVID-19. Secondly, then I'll talk about the economic impacts and market responses so far. And thirdly, I'll point towards some policy-concluded recommendations for ways forward, both from a perspective on multilateral responses as well as domestic policy implications. And then I'm very much looking forward to your questions and comments at the end of the session. So to start off with the context, and even before the outbreak of this current global economic crisis that is very much unprecedented, and probably the most severe economic crisis that we have ever experienced in our lifetimes, at least, Latin America already before that was the slowest growing region in the global south. If I hope I'll be able to share some files with you now, yes. So this is the first file that you might be able to appreciate and how between 2000 and 2015, compared to other regions in the global south, Latin America had already been the region with the slowest GDP growth rate at 2.9%, obviously China being much higher than everybody else. But even compared to South Asia, South Africa, the MENA region, Latin America has a structural problem of achieving economic growth. And similar to the observation made by Gabriel Palma on Chile and others, I would argue that this largely due to the lack of productivity growth, so in output per hour worked. And on the second graph, we can observe that also really well. I hope you're able to see that. So most of the GDP has been generated also again between 2000 and 2015 by changes in labor input contributions. So changes in the labor market increase in overall population rather than in an increase of productivity. So there hasn't been really increases in output per hour worked, which is the productivity contribution rather most of the GDP was generated by changes in population, which shows us already that part of the productivity problem of Latin America is very closely linked to these employment elasticities of labor markets in the region, but also much more widely connected to the undiversified economies, which has much to do with neoliberal reforms since the 1980s and onwards, and I get to that in a little bit. But crucially and more structurally as well, Latin American economies more generally have not been able to successfully transition from early stages of light manufacturing industrialization to later more capital intensive industrial growth. And this has deepened, if you will, a dependency on extractive export oriented accumulation as well as on service sector growth. And looking from a political economy perspective, this dependency can be explained by the dominance of an oligarchic elite that since colonial times have held interest in landed activities. So both in agro industries as well as primary commodities such as coal, oil, gold, copper, zinc, nickel, lead, all of these primary materials that this landed elite was very much focused on. And this historical domination of political and economic lives by this elite prevented the establishment, if you will, of a power base that would facilitate industrial accumulation, both because on one hand we had a very low competition between a different elite faction and this very strong position of elites with this land owning classes, if you will, made it very difficult for emerging industrialists to compete over access to state resources that would help them achieve the competition or competitive frontier with other industrial or industrializing nations at this time. And this capacity to develop a productive sector and the deepening dependence on primary commodity export and services has brought Latin American economies into a situation where they're very vulnerable to external changes. So any change in the global economy has very severe ripple effects on Latin American markets. And this is what we can see with the COVID-19 crisis already and I will get to this in a little bit. But what I mentioned earlier, this structural reasons to these undiversified economies in the region have been deepened by the region's neoliberal turn in the 1980s. So neoliberal policies did not only mean a weakening of the health sector and we see that already in cities like Guayaquil where the virus has spread and the debt lying on the street without being able to access healthcare services but also other social services more generally that were being privatized, deregulated, etc. It also meant that there has been an increase in casualized labor as well as informal labor due to flexibilization reforms meaning it was much more easier to hire and fire. There was no surcharge over time charges, no sick pay, etc. So this flexibilization of the labor market also increased the amount of informal and casualized workers but more crucially as well these neoliberal reforms also weakened even further the state capacities to achieve economic diversification because it was already weakened vis-à-vis this powerful landed oligarchy and neoliberal reforms further sterilized or rolled back states meaning that this had the effect that accumulation models post-1980s even shifted further towards the extraction of oil, minerals, hydrocarbons, coal, zinc, nickel, etc. Furthermore the integration into transnationalized networks of capitalism which were a very integral part of this neoliberalization in the region worsened the situation so rather than investing into the promotion of rather investing into the development of domestic content creation so to increase productivity growth of domestic economies what the Latin American elite did with the integration into transnationalized networks of capitalism was to promote the advancement of global finance capitalism through which they get most of their resources from and this also brings me to another point which is important when we talk about the context of how we find Latin American economies in this current crisis which is financialization so in short financialization describes the ever-increasing significance of the financial sector relative to the real sector and the transfer of more and more incomes from the real sector into the financial sector so with the integration into transnationalized capitalism since the early 2000s Latin America's elite continue to accumulate large surpluses mainly made through these financially ever increasingly sophisticated financial systems and this is on one hand reinforced problems of underinvestment into the real economy but also allowed uncompetitive, unprofitable firms to survive as liquidity came into Latin American countries asset prices inflated of these companies despite flattening productivity levels furthermore low interest rate policies and cheap credit made available through quantitative easing which was mainly created to stimulate recovery of countries in the global south and to stabilize international financial market also resulted in an expansion of debt of balance sheets on the balance sheets of non-banking corporations in Latin America so what speculative investors from the UK, the US, Europe, etc. did they use this cheap credit made available from quantitative easing and sought refuge in profitable corporate bonds, equities, shares, stocks and commodity producing companies in Latin America so this inflated on one hand asset prices as I said also leading to further leveraging of Latin American companies but also crucially it inflated commodity prices which very much helped Latin American economies, particularly those in the Indian region and the southern cone to have relatively stable recovery from the global financial crisis of 2007-08 so what we are seeing now and now talking a bit more about what is happening in this current COVID-19 crisis is we see a massive reversal of this flood of money so while pre-crisis or during the commodity price boom in 2000 and 2015 we saw a massive influx of liquidity into Latin American markets what we see now with the, since the beginning of March practically since the outbreak of this global pandemic happened is a withdrawal of funds particularly from commodity producing economies so what investors are doing now in the global financial markets rather than seeking refuge in what was once meant to be a secure market in commodities they now disinvest from these commodities and invest in mostly US dollars so other currencies but mostly the dollar so they seeking refuge now in a dollar even gold lost value temporarily to the dollar which is something specifically in prices that doesn't really happen and the withdrawal from companies whose asset prices have been inflated with the importing of liquidity during the commodity boom as well as the withdrawal of finance more generally from emerging markets and specifically from Latin America has several implications to which I now get to so as I said there is extreme vulnerability of Latin American economies to external shops these movements in capital and equity markets is hitting Latin American economies particularly hard so asset values of American companies are falling together with commodity prices together with the falling global demand and the end of international travel this means all Latin American countries will be severely affected by this so both commodity producing economies from the Indian region and the southern cone but also the tourist and tourism dependent Caribbean economy some of which get 80% of their income from the tourist industries up to 80% but also Mexico and Central America that very much depend on exports to the United States of up to 70% of their exports that go to the neighbor in the north to the United States so particularly countries in South America and in the Indian region are dependent on commodity exports just to give a quick overview in terms of the export shares Colombia for example exports around 50% of all of exports of Colombia around 50% are fossil fuels 24% in oil and derivatives, 22% in coal and derivatives Chile as the world's biggest copper producer and exporter 50% of all of its exports is copper Peru 30% copper, 6% of oil, lead and zinc Brazil very much depends on soybeans and iron but also crude oil so with the outbreak of COVID-19 and we see this plummeting of commodity prices what I said with the withdrawal from assets from international investors but also the opaque rush of price for but also more generally because of course when there is no production happening globally there's also no demand for these commodities so that's also one of the reasons and most crucially what we saw oil contracting now by over 100% and for the first time ever sending below 40% some of the varieties I think the Texan variety dropped up to minus 40 US dollars at some point two days ago so this means that a lot of the revenues from specifically commodity producing economies will fall away similarly coal has contracted by over 50% copper has decreased by over 20% zinc fell by over 20% lead, soybeans all of these commodities have been plummeting since the outbreak of COVID-19 and as I said another problem is beside the very small diversification of these economies is that we see a dependency on global demand specifically from China and the United States Mexico exports around 73% of all of its exports to the United States Paraguay about 60, Honduras around 50 Belize 22% to the US 19 to the UK, Chile, Peru and Brazil all depend on demand from China so this is also another exacerbating factor when it comes to the effects of COVID-19 for the different economies in the region so yeah this this weaker and for some commodities non-existing external demand further threatens these export oriented countries not just extractive exporters but also countries that focus on other non-traditional exports such as bananas, coffee, sugar, garment while demand might not drop such significantly as for fossil fuels it still has been dropping quite substantially for these products and as I said this has left the region's economy in a very very vulnerable position including of course and what I said earlier the countries dependent on income from tourism particularly Caribbean islands so what does this mean for public finance and for the balance sheets of the countries that we talked about so the fall of revenues from commodity exports, from tourism, from external demand this alone is putting immense pressure on public balance sheets as revenue streams are drying up effectively and all that in a situation where more public investment is needed both to provide food and medicine as supply bottlenecks will intensify over the next few weeks but also to support businesses and workers so we have a more need for more public investment yet a drying up of income due to the fact of commodity prices to tourism external demand dropping so and in addition to that countries and firms in Latin America have financed their economies and social system and corporations through external funding due to the financialization of global economy this is a very cheap way to finance operations to debt finance operations basically and with the tightening of the global financial conditions that is happening as the outbreak of COVID-19 intensifies this will put an additional pressure on balance sheets of corporation governments because we also have the risk that there will be asset fire sales that may follow as financial intermediaries also want to liquidate their holdings to meet funding withdrawal requests from their investors which would exacerbate even further the market turmoil that we're currently seeing so countries that are aligned on external funding and external financing which most Latin American countries are will experience sudden stops to their external to access to external funding and further disorderly market conditions in the global economy so this is an additional layer to obviously the direct economic fallout that I explained earlier but also to the extra economic cost that this health crisis is having due to the funding of food, medicine etc and if this all wasn't enough and some of you might already think well there's really no good news that I'm hearing right now and there's more to come because when we look at this flight of capital to safe havens and this withdrawal of asset health in Latin America to the US dollar to the end to the euros also obviously affected exchange rates so domestic currencies while the dollar, the end, the euro all appreciated domestic currencies and specifically those of commodity exporters with flexible exchange rate have depreciated sharply so while before the crisis this massive inflows that to an appreciation and overvaluation of the local currencies which a lot of the countries thought to happen because it would benefit them and their exports the withdrawal of funds and global disinvestment from commodity assets in this fallout has led to currency prices dropping significantly more even then after the financial crisis of 2007 and 2008 so in the last 40 days or beginning of March if you will which is a bit longer the Mexican Peso has lost over 30% of its value the Brazilian Real has and the Colombian Peso have lost both around 25% Chilean Argentinian Peso contract by around 10% and given that most of the debt is held in US dollars this means that an already problematic debt situation when it comes to public debt and private debt will seriously worsen with the devaluation of the local currencies particularly for countries like Argentina that already are renegotiating currently 100 billion US dollar debt from previous crisis this will lead to additional pressure on their balance sheets for households in cooperation this means that besides from the fall in global demand and the fall of asset prices businesses will also face credit crunch as investors flee and financial institutions face liquidity crisis themselves so they don't really want to give loans to cooperation and even in a case where corporations would be able to get credit a lot of companies don't want to use or don't want to let's say risk even more and take on loans at this very uncertain times so we see production is stopping, debt burden increases also due to the currency depreciation and the risk of defaults and bankruptcy increase for households obviously I haven't really talked about the exploding household debt also as a result from financialization but besides this and besides the pressure that it will put on households in terms of debt it will most in the more immediate future it will particularly hit them when it comes to the unemployment and food shortages and shortages in medicine due to rising bottlenecks but particularly due to the fact that a lot of them will go unemployed without having access to any sort of safety net that was completely eradicated in the neoliberalization since the 1980s and most workers in Latin America's highly flexibilized employment markets live day-to-day or informal employment so many of them are not able to self-isolate because given that there's a lack of response from the government from most governments to supply food and other essential goods a lot of these informal and flexibilized or casualized employees have to go out anyway and they can self-isolate risking obviously to get sick and spread this disease further particularly in informal settlements where this risk of course of both of having to work because of this employment situation that a lot of the people find themselves in but also due to the crowdedness of these places where risk of containment increases yeah so this is a bit of an overview when it comes to households and corporations in terms of the GDP outlook the recent economic, world economic outlook of the IMF also saw that the region's economy overall will shrink by around 5.2% and this contraction would be much more severe than during the 1980 debt crisis of Latin America and the 2009 recession as a follow-up of the financial crisis and we will most likely see the sharpest contraction in the last 50 years I've just had a small graph here from the IMF where you can appreciate that this contraction of 2020 will be much more severe than previous economic crisis that the region faced in the past and as economic and health crisis will deepen because we're still at the start of this and global demand will fall further particularly from China and the United States these already very dire economic projections may need to very well to be revised downwards and Latin American economies have to seriously start preparing for a depression as we see this unprecedented decline in trade and commerce corporations defaulting or going bankrupt due to the exploding debt burdens and the tightening credit crunch, sovereign debt crisis further currency devaluation we will most likely see financial crisis due to households and corporations defaulting on their private debt and investors want to liquidate their investments putting additional pressure on financial intermediaries we obviously will see huge chump in unemployment, poverty and inequality and some of you who might be familiar with Latin America have or have read about the last decade of the 80s that was caused by this 1980 debt crisis what is likely to happen is that we will see another of such a lost decade in the region and most likely lasting even longer than the one in the 80s so this is as I said a very negative, a very daunting outlook and some of you might ask is there any silver lining at all or are there any positives at all in this and going forward and I would say yes there is definitely the chance to fundamentally restructure and rethink the way in which economies and societies are organized in the long run so there is a chance to achieve a shift away from this dominant paradigm that was followed by so many Latin American countries in the past and also pushed by international financial institutions such as the IMF and World Bank in the past with just this neoliberal financialized model of accumulation very much focused on export oriented extractive strategies so there is the chance because of the deep crisis that we face ourselves in particularly if it is possible that oil contracts below zero dollar a barrel I think anything is possible but first I think we have to think about the immediate policies to mitigate the consequences and here given the urgency we will have to make use of the tools that are available already and despite their existing but the flaws of these international institutions such as the IMF we must still I think use them or argue that they will have to be made fit for purpose to meet this crisis so there are several measures that IMF, World Bank and international institutions can make so from a multilateral perspective at first the IMF should be preparing for massive issuance of new special drawing rights to help countries in Latin America for their balance sheet so what we have already seen from the IMF has been a massive expansion of the catastrophic containment and relief trust to support balance of payment of poor countries and also of Latin American companies but these special drawing rights and creation of new ones and transferring existing ones that should be distributed without conditionality so not like before where the IMF used a lot of their funds to put conditionalities in place that basically introduced neoliberal reforms this should be done without conditionality and that would help in battle governments to free up fiscal resources and increase healthcare funding and spending and finance key imports specifically to address crucial supply bottlenecks that will arise in the next few weeks secondly the IMF and policy makers from the global north should be making plans for a significant debt restructuring so the high levels of public and private could easily render all of these efforts to mitigate the direct consequences of COVID-19 few tiles since additional loans from the SDR from the special drawing rights will be used to finance the exploding debt burden and so I would argue that a moratorium so it's freeze on debt is not enough but I would say that a crisis of this proportion a cause for a complete cancellation of all debt held by Latin American countries so this is something that can be done from a multilateral perspective and third governments should consider new and more tighter capital controls to prevent financial markets from exacerbating the COVID-19 fallouts in Latin America meaning that capital is not allowed to leave the countries so easily as before so basically reversing some of the financial liberalization policies as well looting and looking at domestic policies I would argue that this looming economic crisis can only be addressed if Latin American governments start to radically rethink economic policy making so besides the creation of new fiscal resources where that is possible through monetized deficits and or monetary financing of government spending where it is possible and there's no inflationary risks in the countries this needs to go hand in hand with the reversal of privatization reforms and particularly the nationalization of both commodity extracting companies as well as banks and this shift towards a more state led developmental model if you will could use nationalized extractive revenues and newly created resources and can also oblige nationalized banks to forward the credits made available to them in the recovery packages and stimulus packages that have been rolled out for example in Colombia we see that banks private banks that now have access to additional funds post COVID or in the COVID-19 crisis are unwilling to give this to medium and small enterprises so similarly to other monetary stimulus packages in before and what I think would be a solution to this is to nationalize the bank system as well as the incomes from commodity producers so this could help households to overcome liquidity solvency problems it could help governments to suspend mortgage and rent payment specifically for the informal and casualized workers that are without any income this additional fund could be used for unconditional cash transfer programs for households that are facing the biggest burden in this crisis and investing in social services and obviously into the privatized and completely dry and bled into the health systems that have been bled dry businesses could be supported by extending long maturities, deferring taxes this is something that has happened in some cases providing credit through central banks financing etc so in the short immediate term these monetary and fiscal stimuli monetary policies of fiscal stimuli would have to be accompanied by more longer term strategies to build up support for strategic manufacturing industries to get away from the dependency on fossil fuel and other extractive exports and particularly I would argue these strategic manufacturing industries that need to be supported in the long run in the region will have to be linked to renewable energy as well as innovative technology to achieve productivity growth in sectors that are not as farming for the environment as well as for the sustainability of the economy to take it away from the dependency on export oriented extractive accumulation model so just to sum it all up this economic as the economic damage of COVID-19 is shaping up to be both immense and inevitable the region is in desperate need of progressive and radical reversal of the failed neoliberal export oriented development model that has been based on extractive and agro industrial accumulation as well as tourism and yeah I think this is with what I would like to close and I'm very much looking forward to your questions and comments Thank you so much Tavias, that was really interesting we've already got a few questions coming in so but everybody please continue to post questions a few of them I think we had quite a few questions about reactions to the crisis some of which I think you've already touched on I guess somebody quite clear question was do you think the Latin American economy can recover from the crisis? I know you've outlined some policies that they could be following in an ideal world but I guess in reality what are your hopes? Yes a recovery is definitely possible and even a recovery could be possible if nothing basically changes in the political economies which is likely to happen so there won't be any massive changes in the short run at least to the way in which these economies work but I would think that definitely with the help of international institutions and with the access to newly created special transfer rights this could mitigate in the immediate future but also in the long run and I would definitely think yes there is of course possibilities to recover from this as the global economy will recover however what we saw with the recovery of the 2007 and 2008 financial crisis the 2009 recession of Latin America what helped them achieve recovery relatively quickly was China's unprecedented growth and the demand for commodities basically that China did pulling a lot of the global economy as a whole specifically Latin American economies out of the slump and this is not something that we can rely on to happen again so China is not likely to yet again pull the global economy out of this as they face some serious problems in their economy themselves due to an increase in shadow banking and an increased financialized problems that they've gotten themselves into so if we rely on what has worked in the past it worked only to a certain extent if you will, no so this is why I say we need a radical reversal of what has been done and a really nationalization of banks and commodity companies to then use these funds for alternative sector development and more productivity enhancing sectors yeah great we also had well we had a few questions about sort of different vulnerabilities and resilience I've got three questions which are all sort of on the same theme one person asked which countries have been more vulnerable to the shock and why one person asked are countries which have experienced a pink tide more resilient I think they drew a comparison with Kerala and the third one was Venezuela more prepared because they had also recently dealt with another crisis so did that put their government in better stead to deal with it okay thank you very much for these questions very interesting so let me start with which countries are more vulnerable I think that's just a race to the bottom all of those countries were extremely vulnerable given the composition of their exports as well as the dependency on tourism as well as commodities so I think all of them very differently as I said the Caribbean economies very much hit by the complete stop in international tourism whereas most Indian regions and the southern cone as well as Brazil are facing problems because of the fall in commodity prices yeah so I don't think there's some particular countries that are more vulnerable than others and similar to the pink tide I don't think they are more resilient to prices like this in ways that I would argue that might be controversial with some of our listeners that a lot of these countries while achieving different political engagement and political organization in a lot of ways their economies didn't ever really transition to a post neoliberal model of accumulation and they were very much when we look at Bolivia we look at Ecuador we look at Venezuela Brazil all still very much dependent on commodity exports on oil and other primary commodities so and very much dominated by an economic oligarchy that in its core did not change just because there was a different political organization happening so on macroeconomic scale I don't think these countries are better prepared than countries that didn't go through the pink tide movement and Venezuela I think no they're even worse prepared than any other country due to the fact that internationally specifically I think it was at the beginning of this outbreak they tried to access some credit from the IMF and were denied this access furthermore their high inflation risks will only exacerbate in this crisis so Venezuela is set to have by far the biggest contraction as a result of the COVID-19 fallout because it already has this position internationally where it's quite isolated so I think Venezuela is the country that is probably if you will the worst of all of the countries in the moment Thanks very much we've also had a couple questions about the US and the role of US power in this situation so one person asked can we be optimistic about the IMF's STRs in they say since the US can veto them if it's over $500 million and another asked what about US sanctions on countries like Cuba and Venezuela and with the decrease of tourism in Cuba do you think it will go through another great period as in the 90s and with the decrease in the value of oil will Venezuela face even more poverty and problems obviously you touched on oil a little already but yeah thank you So yeah thanks for these questions in terms of the role of the US yes this is especially with the current administration in the White House very much yeah a question that remains to be seen will he do the same that he did with the World Health Organization to defund the IMF at some point or veto special drawing rights I'm not sure if this will happen it can very likely be happening but I don't think we should get caught up with that in the moment rather than pushing the IMF itself to actually roll out these plans In terms of the overall role of the United States in the region I would think that a lot of this focus on commodities but also a focus on tourism what it has done it has sort of led some would argue to the new imperialism as most of the companies both in the tourism industry as well as in the commodity extracting companies in the region are US capital or European capital and held by them So in the longer run this dependency or this new imperialism if you want to follow the words of some academics could only be reversed if this dependency on these sectors will diminish let's say and then that you actually have domestic content and a productive sector that can develop capacities for high productivity and technology growth Cuba I mean Cuba yes it can very well lead again to another of this situation however with the more what we've seen already with Cuba's response on the health aspect with sending doctors to Italy for the first time ever to a country in the global north I think they have also shown international solidarity where for example the European Union was not able to do in some cases to its own members so there could be a civil lining in terms of okay they showed solidarity will we see solidarity for Cuban economy I will substantially suffer from the fall in tourism oil in Venezuela yeah I touched upon that I will be for sure the real revenue that they still had it will completely fall that fall away and yeah what I hear from people in Venezuela is that the situation is looking very very everything is quiet right now everything is died down and they're just waiting for the next revolts happening but let's see great and also so we've got about eight minutes left so we have a few questions which were very much looking towards the future which is probably nice to close on one person asked they noted that the IMF usually ask for austerity measures to guarantee loan payments do you think that there's a chance that they'll change that approach one person asked could there be any implications in terms of the debt moratorium that could deepen or worsen the financial crisis and then one person asked do you think the epidemic could be considered beneficial to some of the Latin American economies as country companies are scrambling to move their supply chains out of China Mexico being one of the destinations just to start I'm not sure I understood the debt moratorium question very well they well they just mentioned it was one from Rob I think he said I like the radical proposition of a debt moratorium are there any implications of such policy that could deepen or lead to further financial crises I guess could there be any negative implications yeah and due to due to not you know yeah in their countries not paying their loans back to then have you know and basically defaulting on their loans okay now yes and yeah this is this is definitely definitely another problem that could happen and that's also why any of these policies that I pointed to at the end can't really be looked at in isolation so while we need a cancellation I would not just argue from moratorium but a complete cancellation of all debt we also need of course to make sure that the financial system has enough liquidity so it won't we won't go into a next massive financial crisis so this is of course something that has to happen but this is why I didn't press so much on this is that I think most most response that we've seen so far has already favored banks and financial markets over over small and medium enterprises and workers so I don't I don't really I don't really think that this is a big concern to be had primarily but it's an interesting it's an it has to come together let's say in terms of Mexico and Mexico being beneficial beneficial I don't think so given that that in China we already see a fall in cases and overall there will be the quickest recovery to be happening in China and so in terms of supply chains shifting from China to the to Mexico I don't think so because we start with just at the start of the outbreak in Latin America and most likely this will worsen on the next few weeks and months and when it comes to the IMF yes I'm the first to criticize and to be very very pessimistic about calling for the IMF to to the rescue and all of us I guess from a more progressive background would would find it a bit problematic to to now say we need the IMF but it is with the there's not a lot of not a lot of time so we don't have time to now come up with a new financial system that that that kind of rise and meet this challenge which is simply not possible so we have to make sure that what we have what is in place is used and is used in a way that learns from the past now you can say they have never learned from the past not quite true so they've already started the conversation a few years ago before it was even a mainstream became the mainstream in other countries that are staring at work so I think there has been a shift within the IMF about we of course will need to pressure that this will will will continue and that new funds and as I said in my talk is new that that special drawing rights will be given unconditionally so there won't be any conditions on on saying alright we give you that but in return you have to implement austerity policies rather we give you that and please reverse all of these policies that we where we said 30 years ago you should be doing and if there is such a self reflection in the IMF I don't know but I do have hope that that there is especially now with the outbreak of the crisis a realisation that austerity has completely failed and I mean we already see that when I talk to people that work in government in the UK even in the UK you have a questioning of these measures and everybody is becoming sort of half-baked Keynesianists all of a sudden people who for years have been Austrian following the Austrian school are now all of a sudden Keynesians and want public spending to rise and so on and so forth so I don't think that the IMF would say alright we need more austerity what we need is very clear and it is more public spending right now Yeah I totally agree that this is a moment hope for the best in terms of any structural change that might come and we're coming towards the end so I think I don't think we have any more time for questions but thank you so much everyone who did submit a question what I'd like to do is Tobias if you'd like just take literally one minute and just sort of summarize some key points or any concluding remarks that you'd like to get in before we close the session Well I think I didn't really talk about that much about any of the household and the effects of the households I mean I did to some extent but what we see now is that a lot of people and again the poor in Latin America are facing the brunt of this outbreak having to go out, having to work and not being able to protect themselves and self isolate and even in cases where you might be able to do so in overcrowded spaces and I think while I've talked mostly about the macroeconomic impacts and the commodity prices, asset prices, currency etc. I think what we really need to realize is the severeness of this crisis on the day to day people in the working class and the informal workers in Latin America and so I call maybe for you to extend the solidarity in any way that you can be it through reaching out to organizations that help people on the ground or just you know if you don't have the means post about it, make people aware that you know there's situations that are far worse than in the UK and in Europe and that particularly it is the very poor that have been suffering for so long under the neoliberal reforms that are yet again suffering the most and so either you post about it and make some noise or if you can also donate to some organizations and there's plenty out there that you can do that too so maybe that could be more of a human closure to this and thank you very much everybody for joining and for this very interesting question. Thanks Alice for moderating and we'll see you hopefully next week. Do you want to say what is up next week? Brilliant, thank you so much. Thanks so much for speaking to me as I think we had a really interesting and constructive discussion. The next in the webinar series will be Wednesday the 29th. We'll have Costas Lapavitas who will be speaking about the limits of neoliberalism, how states respond to crisis. Like I said at the beginning please follow us on our social media. You can find us on Facebook and Twitter at the Open Economics Forum. We will be posting the recording of this session in case you want to watch it again or share with anyone else please do share the webinar as it goes along and hope to see you next time. Thanks a lot guys and everybody take care. Thank you. Bye. Bye.