Almost three months after the COVID-19 pandemic hit the Americas and the Caribbean, data is showing how deeply the private sector has been affected, as some businesses are being forced to close while others are struggling to continue operating due to limitations in markets and supply chains.
Whilst the economic impact of the crisis is still unforeseen, according to estimates by the Economic Commission for Latin America and the Caribbean (ECLAC), economic activity in the region is expected to contract by 5.3 per cent by the end of 2020. Though as the dynamics of the pandemic continue and physical distancing measures remain necessary, the contraction can be expected to be greater than projected.
Thus, supporting the private sector to maintain operations and achieving resilience is critical for the short-term recovery efforts in the region. This support requires to be particularly focused on small and medium enterprises (SMEs), which according to ILO could makeup around 70% of sources of employment in the Americas and the Caribbean and often lack the financial capital to resist prolonged disruptions. Only in the US, according to FEMA (2016), 40% of SMEs do not reopen after disasters. Consequently, the need to better integrate risk into business practices and decisions, as well as generate networks of support with different partners, is becoming a priority for the private sector. Thus during the COVID-19 pandemic, it has been observed how the business community across the world has made an active effort to ramp up its capacities on business continuity, as well as to connect and learn from other peers.
As put by Chloe Demrovsky, CEO of Disaster Recovery Institute International (DRI) and member of UNDRR Private Sector Alliance for Disaster Resilient Societies (ARISE) in a recent article published by Forbes, over the last months her institute has been receiving multiple requests from companies and organizations that don’t have a business continuity plan, for help and resources to respond to the global pandemic. Likewise, through the ARISE initiative in the Americas and the Caribbean, with support of UNDRR, members including national and multinational companies, business networks and chambers of commerce have mobilised to provide companies in their countries with tools, information and resources to become more resilient in the face of COVID-19.