How Brazil and Mexico Diverged on Social Protection in the Pandemic

Abstract

Mexico and Brazil, both among the region’s hardest hit by COVID-19, took strikingly different steps to mitigate the economic impact of the pandemic. Although President Jair Bolsonaro dismissed the need for social distancing measures, the government provided substantial financial aid to citizens though cash transfer programs, avoiding potentially sharp increases in poverty and inequality. Mexican President Andrés Manuel López Obrador, who also displayed a dismissive attitude about the virus, made relatively little effort to protect the poor and unemployed from its effects, despite his pro-poor rhetoric. As a result, the Mexican economy was projected to contract by 9 percent in 2020, while poverty sharply increased. Rising malnutrition and missed schooling may have long-term consequences for inequality.