Peru struggles to overcome pandemic, restart economy
Dan Collyns

Faced with recession, Peru is struggling to overcome one of the region's worst COVID-19 outbreaks as its economy reels from the impact of a strict lockdown. CGTN's Dan Collyns reports from Lima.

One of the strictest lockdowns in Latin America failed to shield Peru from COVID-19's brutal blow. 

Amid one of the highest fatality rates in the region, many thousands also became jobless here in Gamarra - Lima's bustling textiles hub. They were among the more than six million Peruvians who became unemployed in the last financial quarter. 

But as the economy was gradually opened up during June, the rush of people onto streets ​spurred a spike in coronavirus cases and deaths, total infections since then, doubl​ing.  

"I'm not expecting to get a handout, I go out and sell these biscuits because I have to make a living.  If you don't work, you don't eat," said Carlos Reaño, a street vendor.

More than half of Peruvians hold precarious jobs like this, working day-to-day.  

At the beginning of the pandemic, the government paid out a multi-billion dollar stimulus package with bailouts for companies and twice-monthly cash transfers to poor families.  

But many people say they never got the money and businesses complain it just wasn't enough.  

"I have my shop but the banks have been unforgiving. They froze the debt payments for three months, then they demand you pay them," said Shop Owner Carlos Gilvonio. "Where are you going to get the money if you've been inside for three months?"  

In Lima's financial district, most office buildings remain empty. Financial services operate at a minimum and exports have plummeted.   

Peru has one of the highest coronavirus mortality rates in Latin America; whether it can maintain social distancing and jump start its economy is a moot point but after four months of economic contraction, some argue that it has little option..  

Peru’s economy contracted by nearly a third between April and June, a second consecutive quarter in the red, putting the country technically in a recession. 

"It is actually impossible nowadays to keep the economy closed. In this, in this society, in this Peruvian society, more than half of workers have precarious jobs," said Hugo Ñopo, lead researcher at the Grade think tank.

"They earn their living on a daily basis. So to stop them from working and earning a living would be just impossible." 

Ñopo says the current reopening strategies are not working.

"One important element here is the gap between the design and implementation. We had great designs. Bonuses to families and businesses, big and small. The problem is this design did not land, did not materialize in a timely way," he said.

In most cases the cash payments arrived late, or sometimes not at all. Businesses battled with red tape to get their bailouts; many won't survive.

As people go back to work, the government says the onus is on them to put their health first, but keeping a safe distance is not an option for everyone.

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