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Gradual easing of lockdown but a slow recovery

  • Remote Monitoring Report
  • El Salvador, Honduras, and Nicaragua
  • June 2020
Gradual easing of lockdown but a slow recovery

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  • Key Messages
  • Key Messages
    • Over the next three months, Honduras and El Salvador are expected to begin a gradual economic reactivation and an easing of lockdown. This will lead to a progressive increase in income earning opportunities, although the informal sector will continue to be affected for longer than the formal sector. Nicaragua will continue without restrictive measures.

    • In rural areas, poor and very poor households will find themselves in the lean season until August, with few income opportunities. The beginning of the season of high labor demand in October will permit an improvement in the incomes of the poorest households, but this will be limited by the restrictions on movement that are likely to persist in some areas.

    • Due to a forecast of above-average rainfall until January 2021, average Primera and Postrera crops are expected, with localized areas slightly below average as a result of weather events and pest infestation caused by excess humidity. However, white maize and red beans are expected to remain above average and above 2019 prices, reducing access to food for poor and very poor households.

    • From June 2020 to January 2021, along with the gradual economic reopening, there will be a seasonal improvement in access to and availability of food in rural and urban households in the region, placing them in Stress (IPC Phase 2). The poorest rural households in the Salvadoran coffee zone and the Honduran dry corridor will be the exception as they will be in Crisis (IPC Phase 3) due to the accumulation of previous events, lockdown and the outlook for the period.




    El Salvador and Honduras

    • Despite the continuing increase in the incidence of COVID-19, both the El Salvador and Honduras governments began reopening trade and industry activities on 15 June and 8 June respectively.
    • Food is available in both countries since the food sector has been prioritized as a permitted activity during lockdown and most markets (urban and rural) are open. However, at the household level, falling incomes and restrictions on movement have resulted in reduced food access.
    • The lean season began early for the poorest rural households in the Honduran dry corridor and some areas of El Salvador due to agricultural losses resulting from drought in 2019 and the effects of several consecutive years of poor crops of basic grains and coffee, and for several months these households have been implementing strategies to obtain economic and food resources.
    • Assistance has been provided in both countries to at least partially cover the basic needs of the poorest households during the months of May and June, including cash and food baskets.
    • A gradual and intermittent reopening of commercial and industrial activities is expected over the coming months. Improvements in formal and informal employment levels in urban and rural areas and in income will also be gradual, and will persist throughout the period, while food availability in markets will improve considerably.
    • Due to restrictions on movement between countries, migration for the coffee harvest can be expected to fall between October and January, which would mean lower incomes for some households and greater difficulties for production yields in the region due to a late harvest.
    • According to the United States Department of Agriculture (USDA), the El Salvador coffee harvest is expected to be 5.9 percent lower than in 2019/2020. This would slightly reduce demand for labor and wages for day laborers.
    • The poorest households in the Honduran dry corridor and some areas of El Salvador that depend entirely on purchasing for much of the year will continue to be affected by reduced options for employment in agriculture and other activities, due to the economic impact of COVID-19. This population group, which already reported coping strategies prior to lockdown, will face a continued decline in income until the end of the period under review.
    • To date, there is no information on when governmental humanitarian assistance will end, and provision is not expected to be sustained throughout this period.



    • Despite the absence of government measures to prevent the spread of COVID-19, the population has chosen to enter a voluntary lockdown. Stores and businesses have thus been partially closed, leading to a fall in household income in the formal and informal sectors in both rural and urban areas. However, the impact is less severe than in El Salvador and Honduras. In addition, the sociopolitical situation in the country has disrupted employment in certain sectors over the past two years.
    • The Nicaraguan government is not expected to implement measures to restrict commercial activity.


    • According to data from the central banks of each country, income from remittances has fallen significantly in the three countries. Approximately 30 percent of households in El Salvador saw a decline in the flow of remittances. In Honduras figures show that, from January to May, there was a 7.1 percent fall in the total value of remittances compared with the same period in 2019. This was despite a 25 percent recovery in May with respect to April, when a 10 percent fall from the previous month was reported.
    • The US Geological Survey/National Oceanic and Atmospheric Administration (USGS/NOAA) accumulated rainfall maps show above-average values in El Salvador, southern Honduras and the Atlantic Coast of Nicaragua between May 1 and June 6. However, these accumulations were above 145 percent of the average due to tropical storms Amanda and Cristobal, in the period beginning 26 May. In El Salvador the storms caused agricultural losses which in the case of maize represented 11 percent of the total area planted according to the Ministry of Agriculture and Livestock. 
    • Food prices presented by regional market information systems continue to show atypical increases as a result of the drought losses of the previous year, measures to contain the spread of COVID-19, speculation and stockpiling. The prices of white maize, and red beans in particular increased in comparison with the five-year average and from the previous year.
    • With the resumption of commercial activities in countries where there are more migrants, such as the United States, Spain and Italy, the flow of remittances is expected to show a recovery compared to the first six months of the year. However, given the post-COVID economic difficulties in these countries, the World Bank projects a decline of almost 20 percent by 2020 for Latin America and the Caribbean.
    • According to NOAA, rain accumulations are expected to be average or above average during Primera and Postrera Seasons, with a canícula [hottest, driest period] that is normal in duration and intensity. The forecast for the hurricane season in the Caribbean is also above average.
    • The Primera harvest is expected to be within the average for the three countries. Unless households affected by tropical storms Amanda and Cristobal manage to resow, they will have low or zero yields for this cycle.
    • The Postrera harvest is expected to be normal to slightly below normal, as higher humidity conditions may affect beans.
    • Projected prices for maize and beans in the region are above the average and 2019 prices. This will affect access to food in poor and the poorest households in urban and rural areas.


    Due to projected above average accumulations of rainfall in the region during the entire period under review, a canícula within the normal range, and government support for agricultural production, the Primera harvest is expected to fall within normal values. The red bean harvest may even be above normal in Honduras, where production is being boosted in non-traditional areas during a cycle in which this crop is not usually so important. However, there may be slightly below average production as a result of climatic effects in localized areas such as El Salvador, which was already significantly affected by heavy rainfall accumulations caused by storms Amanda and Cristobal, and where some farmers will not be able to sow again (Figure 1).

    The Postrera harvest is expected to be average to slightly below average, given the susceptibility of beans – the most important crop during this cycle – to moisture damage. Governments also plan to support increased production during this cycle by expanding the area of production.

    The forecast of a more active than average hurricane season for the Caribbean basin, from June to November, is a factor that could alter the scenario described above.

    In addition to the agricultural outlook, it is expected that over the coming months all countries will have gradually begun reopening the economy and reducing restrictions on production, domestic trade, and the cross-border flow of goods.

    Despite this, prices – especially for maize and beans – are expected to remain high compared with the average for the last five years and with the previous year (Figure 2). It is also expected that, with the resumption of trade in other countries around the world, there will be a slight increase in demand for products from the region to its partner countries.

    As a result, unemployment levels in the region will gradually start to fall. It is important to bear in mind that companies that survived lockdown will have to embark on a long recovery. In addition, wages will not return to pre-pandemic levels while trade and industry make adjustments to assist their economic recovery. This scenario in the formal and predominantly urban sector will also have an impact on the informal sector, which more households are expected to join as an alternative means of generating income. October is the beginning of the peak of the annual high labor demand season for commercial crops such as coffee, sugar and peanuts. However, there are population groups in the dry corridor of Honduras and the coffee-growing zone of El Salvador that have suffered a significant deterioration in their livelihoods due to past disruption to their production and, in turn, their income, and whose employment options will be limited by a slow economic recovery post-lockdown. Internal migration for daily wages will become easier as governments relax restrictions on movement, although migration between countries is not expected to fully resume in the short or medium term. These changes also apply to Nicaragua, where there has been a voluntary lockdown that has had an impact on all commercial activities, already affected by a socioeconomic crisis since 2018.

    Although the flow of remittances will gradually increase as employment options for migrants increase in their countries of residence, a return to pre-pandemic levels is not expected since the main countries of origin (the United States, Spain and Italy) are those that have been most affected by health issues. In fact, World Bank forecasts for this year show a 19.3 percent drop in remittances for Latin America and the Caribbean, which is higher than the drop during the 2009 financial crisis. Since these flows are important for the economies of recipient countries and households, economic recovery will be slow and will continue until 2021.

    No governmental humanitarian assistance is anticipated in Nicaragua or Honduras, despite the fact that food was distributed during April and May in the latter country. On the other hand, assistance from international cooperation agencies, particularly in the form of vouchers, is planned until August. According to the World Food Programme (WFP) Regional Report, only 10 to 20 percent of people reported receiving food assistance in May. In El Salvador, the government has not indicated how long current provision will last, but it is not expected to continue beyond June. In addition, WFP is requesting U$ 8 million to provide food assistance for two months to 153,500 people affected by tropical storm Amanda. This request is in addition to the US$ 19 million required to support the El Salvador government in its response to the pandemic.

    Expected food security outcomes From June to September 2020, very poor households in Honduras and El Salvador, in both urban and rural areas, are expected to face difficulties generating income during the relaxation of measures to contain COVID-19. During this period, rural households – like urban households throughout the year – depend mainly on purchasing as a source of food until the Primera harvest in September. Of particular concern are the poorest urban households in the region, which will be very slow to make an economic recovery after the pandemic; households in the rural areas of the Honduran dry corridor afflicted by drought losses in 2019; and in the El Salvador coffee-growing zone. In a normal year, these households do not have reserves at this time; however, lack of reserves since 2019 has led to the early employment of coping strategies. In this context, lockdown significantly reduced their employment options and consumption, and led to abnormally high prices. As a result, these households are expected to be in Crisis (IPC Phase 3). In both countries, however, economic reactivation and the start of the Primera harvest are expected to increase food availability and lead to a gradual rise in income for the majority of the population. In Nicaragua, due to the fact that there are no government restrictions on trade, social distancing has been initiated by the population, and following the 2019 drought in some areas of the dry corridor, the poorest households are expected to be in Stress (IPC Phase 2).

    October 2020 to January 2021 will see the annual season of high labor demand in export crops, and an increase in the availability of food on the market and in producer households, due to crops from the Primera harvest and the start of an average Postrera harvest. It is expected that restrictions on movement will have been relaxed by this period and there will be improved regional economic recovery as the resumption of commercial activities continues. Employment options are thus expected to increase compared with previous months, which will lead to a rise in incomes, particularly in urban areas. All of this will allow greater food access and availability compared with the previous period. Therefore, a large number of urban and, to a lesser extent, rural households in the three countries will remain in or improve to Stress (IPC Phase 2). The exceptions are the extremely poor rural households that depend on daily wages, located in the Honduran dry corridor and the Salvadoran coffee-growing zone, which will be in Crisis (IPC Phase 3). Day laborer households will face possible restrictions on their migration to coffee plantations. In addition, the prices of basic grains are projected to remain above average, meaning that households that are highly dependent on purchasing will have less access to food. This will lead to a food consumption deficit unless they use negative coping strategies. During the period under review, provision of food assistance is not expected to be sufficient to reverse these food security outcomes. 

    Figures Calendario estacional para un año típico 
en América Central a partir de julio, que muestra el inicio y final de cada tempor

    Figure 1


    Source: FEWS NET

    Gran parte de la región recibió lluvias superiores al promedio durante el período. La parte oriental de Guatemala tieme valor

    Figure 2

    Figura 1

    Source: USGS/FEWS NET

    Los precios proyectados del maíz indican un alza pequeña a moderada en comparación con el promedio. El frijol rojo indica pre

    Figure 3

    Figura 2

    Source: Elaboración FEWS NET con información de Sistemas de Información de Mercados de …

    In remote monitoring, a coordinator typically works from a nearby regional office. Relying on partners for data, the coordinator uses scenario development to conduct analysis and produce monthly reports. As less data may be available, remote monitoring reports may have less detail than those from countries with FEWS NET offices. Learn more about our work here.

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