AR: COVID-19 Emergency Response Project

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Strategic and country context. An outbreak of the coronavirus disease (COVID-19) caused by the 2019 novel coronavirus (SARS-CoV-2) has been spreading rapidly across the world since December 2019, following the diagnosis of the initial cases in Wuhan, Hubei Province, China. Since the beginning of March 2020, the number of cases outside China has increased thirteenfold and the number of affected countries has tripled. On March 11, 2020, the World Health Organization (WHO) declared a global pandemic as the coronavirus rapidly spreads across the world. As of March 16, 2020, the outbreak has resulted in an estimated 182,438 cases and 7,157 deaths in 162 countries. COVID-19 is one of several emerging infectious diseases (EID) outbreaks in recent decades that have emerged from animals in contact with humans, resulting in major outbreaks with significant public health and economic impacts. The last moderately severe influenza pandemics were in 1957 and 1968; each killed more than a million people around the world. Although countries are now far more prepared than in the past, the world is also far more interconnected, and many more people today have behavior risk factors such as tobacco use and pre-existing chronic health problems that make viral respiratory infections particularly dangerous . With COVID-19, scientists are still trying to understand the full picture of the disease symptoms and severity. Reported symptoms in patients have varied from mild to severe, and can include fever, cough and shortness of breath. In general, studies of hospitalized patients have found that about 83% to 98% of patients develop a fever, 76% to 82% develop a dry cough and 11% to 44% develop fatigue or muscle aches . Other symptoms, including headache, sore throat, abdominal pain, and diarrhea, have been reported, but are less common. While 3.7% of the people worldwide confirmed as having been infected have died, WHO has been careful not to describe that as a mortality rate or death rate. This is because in an unfolding epidemic it can be misleading to look simply at the estimate of deaths divided by cases so far. Hence, given that the actual prevalence of COVID-19 infection remains unknown in most countries, it poses unparalleled challenges with respect to global containment and mitigation. These issues reinforce the need to strengthen the response to COVID-19 across all IDA/IBRD countries to minimize the global risk and impact posed by this disease.This project is prepared under the global framework of the World Bank (WB) COVID-19 Response financed under the Fast Track COVID-19 Facility (FTCF) and key activities supported under the Project are aligned with the COVID-19 SPRP developed by the WHO. The Pan-American Health Organization (PAHO) is providing technical support to the Argentina National Ministry of Health (NMOH) on the management of the pandemic. In addition, the NMOH has requested financial support from other international organizations such as the Inter-American Development Bank (IDB) and the Andean Development Corporation (CAF, for its acronym in Spanish), mostly through the restructuring of their existing operations to support the strengthening of the country response capacity to deal with the COVID-19 pandemic.The COVID-19 outbreak hits the Argentine economy in a moment of significant macroeconomic imbalances and a highly uncertain outlook. Macroeconomic volatility, intensified after the sell-off of Argentine assets in August 2019, triggered an acceleration of inflation and a fall in real wages, which declined by 7.5 percent in 2019. This - coupled with fiscal consolidation and a general context of high uncertainty - slowed consumption and investment, dragging the economy down for the second consecutive year. Gross domestic product (GDP) fell an estimated 2.1 percent in 2019, and unemployment and poverty rates increased. According to latest official estimates (mid-2019), 35.3 percent of Argentines living in the main urban areas are poor, and 7.6 percent are extreme poor. Even under a positive scenario of macroeconomic stabilization and gradual economic recovery, a return to positive growth rates is not expected before 2021.Against this backdrop, the government has enacted a package of fiscal measures aimed at increasing revenues and protecting the most vulnerable and engaged into a sovereign debt restructuring process. The Government enacted in December 2019 a package of fiscal measures to increase revenues and redistribute public resources to lower income groups, aiming at alleviating poverty and stopping the economic contraction. Preliminary estimates by the Bank indicate that taken together these measures would be fiscally neutral. The Government has also engaged in a sovereign debt restructuring process with private creditors (under foreign law), in response to large debt obligations coming due over the following months. This process follows an ambitious timetable and is conducted in parallel with discussions with the Fund on the future of the Stand-by Agreement (SBA) program, which is currently on hold. The successful conclusion of these processes is critical for reducing the large uncertainty dominating Argentina’s economic outlook, and for creating the fiscal space needed to confront the large expected fallout of the COVID-19 outbreak. Sectoral and institutional context. Argentina is one of the Latin America and the Caribbean (LAC) countries especially at risk for the spread of COVID-19 due to its links with the two countries with the highest number of COVID-19 cases to date globally – China and Italy – and it is the first country in LAC to register a death due to COVID-19. Since Argentina has had large waves of Italian immigrants in the past, it has an especially high number of visitors to and from Italy. It has also developed strong commercial and migratory ties with China. As of March 16, 2020, Argentina has 68 confirmed cases of COVID-19 and likely many more with the disease but without it being detected so far. There have already been two deaths in the country from COVID-19. The number of cases as well as deaths are expected to rise rapidly.The risks of rapid spread of COVID-19 are enhanced by the demographic profile of the population. Argentina’s population has been aging steadily, and around 15.4% of the population are aged over 60, while around 7.6% are aged over 70. In Italy – a high-income country where most people have relatively good access to health care – point estimates for the fatality rate of the virus appear to be about 4.6% for people aged between 60 and 69 years, and about 9.8% for those aged 70 years and above. All of this is worsened, in turn, by the ongoing economic and fiscal crisis. Argentina is still in the midst of its worst economic crisis in almost 20 years, and there have been substantial budget cuts in the public sector, including for health. This has had a substantial negative impact on the public health services provided across the country, as well as in the provision of supplies for basic public health (including for HIV and TB treatment, and vaccines). The current situation has led to challenges in addressing an ongoing outbreak of dengue in the North (the poorest region with the worst health outcomes) and in the Central region. These budget cuts affecting the public health subsystem could have substantial adverse impacts on attempts to control the spread of COVID-19, in the absence of adequate and intensive additional control efforts.Argentina has formulated a comprehensive COVID-19 Preparedness and Response Plan, which is aligned with the WHO’s SPRP and with the critical steps listed above. The Plan is aimed at slowing transmission, delaying outbreaks and providing optimized care for all patients, especially the seriously ill, as well as minimizing the impact of the epidemic on health systems and social services and, consequently, on the economic activity. The Plan – underpinned by the newly issued National D