Flaws in Asia’s Pearl

Armed Conflicts, Asia-Pacific, Civil Society, Crime & Justice, Featured, Headlines, Health, Human Rights, Humanitarian Emergencies, TerraViva United Nations

Opinion

In March 2021, the UN Human Rights Council was given a mandate to collect and preserve information and evidence of crimes related to Sri Lanka’s 27-year long civil war that ended in 2009. Meanwhile, Western nations taking a cue from the Human Rights Council’s highly critical resolution on Sri Lanka appear to be tightening the noose. Credit: UN Photo / Violaine Martin. 43rd session of the Human Rights Council.

LONDON, Jul 5 2021 (IPS) – For well over a century Ceylon, now Sri Lanka, has been known to the world as the ‘Pearl of the Indian Ocean’ for its multifaceted attractions. That is until blurb writers ruined it all with hyperbolic epithets that obscured the country’s magnetic charms, which attracted visitors from around the globe.


But one particular epithet has lived up to its name. Called ‘a country like no other’, Sri Lanka is increasingly beginning to prove this true – though not for the reasons that originally prompted it.

Over the years, groups of professional politicians and those drawn to the sphere, not to serve the public but by thoughts of self-aggrandisement and avarice, have dragged this once prosperous country, with its many natural resources and strong democratic institutions, towards its nadir.

From being Asia’s first democracy, with universal franchise granted in 1931– even before independence from Britain in 1948– political commentators and increasingly the public now fear that the country is teetering on the brink of militarism, with retired and serving senior officers in key positions in the civil administration, and others appointed to virtually oversee Sri Lanka’s 25 administrative districts.

While there is both international and local disquiet over the deterioration of democratic values, of more immediate concern is the country’s dire economic state. The situation is so critical that less than two weeks ago, the respected Sunday Times wrote that President Gotabaya Rajapaksa’s government is ‘steps away from bankruptcy’.

At the same time, well-known economists were pressing alarm bells, warning about the possible breakdown of the banking system ‘causing a collapse of the economy’. The direct cause of the current crisis was the sudden hike in fuel prices in late June, which is bound to have a ripple effect on other commodities and services.

Bakers are already threatening to raise their prices, which could well have happened by the time this article appears.

A thermometer gun is used to take a boy’s temperature in Sri Lanka. Credit: UNICEF/Chameera Laknath

With the prices of staples such as rice and vegetables unbearably high, the average consumer, already burdened by the steepening cost of living, is being pushed to the wall by a government that came to power some 20 months or so ago promising to reduce poverty and improve living standards.

Rising living costs are compounded by a still uncontrollable Covid pandemic. This has compelled the government to impose lockdowns and curb travel – restrictions which are haphazardly lifted and re-imposed, despite the best medical advice – as daily wage earners run out of cash to buy food for their families and meet other domestic needs.

Political commentators and increasingly the public fear that the country is on the brink of militarism

Last month, the Sri Lanka Medical Association urged President Gotabaya Rajapaksa to continue lockdown restrictions without interruption–”considering that over 2,000 Covid 19 cases and over 50 deaths are being reported daily” and also the detection of the highly dangerous Indian variant’.

At the time of writing, health authorities reported another 52 fatalities and put the daily count of positive cases at 2,098. But such statistics seems to matter little to politicians and their military and medical cohorts, tasked with combating the spreading pandemic but ignoring the accumulating data and the advice of specialist medical professionals.

Meanwhile, the vaccination of the population, according to a pre-determined programme, has been disrupted by politicians who have drawn up their own priority lists and even threatened doctors and health workers who refused to accept their dictates, raising law enforcement issues and public criticism.

Those with power and influence find backdoor means to gain access to vaccinations, at the expense of an increasingly frustrated and angry public, who stand in long queues for hours awaiting their turn.

While the overall Covid containment programme is reportedly in a mess, along with an economy going steadily downhill, another pearl turned up in the Indian Ocean close to Colombo port. The X-Press Pearl, a Singapore-registered container ship, was carrying noxious cargo, including a leaking nitric acid container. With Qatar and India refusing to admit the vessel for repairs, it turned up in Colombo

That poisonous pearl spewed nitric acid into the ocean and then self-immolated, burning for days before part of it went down on June 2. As a result of the incident, more than 150 marine animals, including 100 turtles, 15 dolphins, three whales and scores of birds and fish beached in various parts of the country, not to mention the kilometres of beach covered with plastic pollutants, leading a UN representative in Colombo to describe the episode as a ‘significant damage to the planet’.

Meanwhile, the original pearl of the Indian Ocean is struggling to keep its head above water. The Sunday Times’ economics columnist Dr Nimal Sanderatne, an agricultural economist, former central banker and academic, painted a bleak picture in his weekly column in late June: ‘The external finances of the country are in a perilous state. External reserves have fallen, the trade deficit is widening, the balance of payments deficit is increasing and there are foreign debt repayments of about US$4 billion during the rest of the year.’

His views about the parlous state of the economy were echoed by several other economists, including the spokesman of Sri Lanka’s main opposition party SJB, Dr Harsha de Silva, and Dr Anila Dias Bandaranaike, a former assistant governor of the Central Bank.

In a desperate bid to boost reserves, Sri Lanka went for a currency swap of US$200 million with Bangladesh, once a struggling new nation in South Asia. Prudent economic policies and management, and national interest, brought Bangladesh to its current flourishing status.

When the currency swap was announced, one Sri Lankan wag remarked that it would have made more sense if Sri Lanka had swapped its advisors for those from Bangladesh, and the swap should be permanent to protect the country’s self-respect

Only a country that has lost its political sense and perceptiveness, or has abandoned all concern for its struggling people, could seek government sanction to import nearly 300 vehicles costing Rs 3.7 billion for its 225 parliamentarians and unnamed others, in the midst of a severe foreign currency crisis, when begging and borrowing seem the only options.

What is even worse, Sri Lanka’s premier state bank was ordered to open letters of credit one month or so before cabinet approval had been sought. Whoever ordered this remains unknown to the public at the time of writing.

Critics of the government say it is fast losing its one-time popularity as ill-considered and sudden policy decisions are heaped on existing economic and health problems, such as the snap decision to ban chemical fertiliser and pesticides, so essential right now for agriculture and export crops such as tea.

Scant wonder the government is being assailed by even close associates of the Rajapaksa family. One such is the head of the Catholic Church, Malcolm Cardinal Ranjith, who, in a strongly critical statement recently said that ‘even nature seemed to be turning against the rulers’.

Meanwhile, western nations taking a cue from the UN Human Rights Council’s highly critical resolution on Sri Lanka last March appear to be tightening the noose.

At the end of June, the European Parliament moved a resolution, with almost 90 per cent voting for it, urging the EU authorities to consider suspending the Generalised System of Preference (GSP Plus) trade concessions to Sri Lanka, which would be a serious blow to exports.

Later the Core Group of Western nations that sponsored the UNHRC resolution issued a statement condemning Sri Lanka’s human rights situation and new changes to the Prevention of Terrorism Act.

Bleak times lie ahead.

Source: Asian Affairs Magazine

Neville de Silva is a veteran Sri Lankan journalist who held senior roles in Hong Kong at The Standard and worked in London for Gemini News Service. He has been a correspondent for foreign media including the New York Times and Le Monde. More recently he was Sri Lanka’s deputy high commissioner in London

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Universal Civil Registration and Vital Statistics Are Critical for Truth, Trust and COVID Recovery in Asia and the Pacific

Asia-Pacific, Civil Society, Development & Aid, Featured, Headlines, Health, Human Rights, Humanitarian Emergencies, TerraViva United Nations

Opinion

BANGKOK, Thailand, Jun 28 2021 (IPS) – With health systems at a breaking point, hospitals at capacity and desperate family members searching for oxygen for loved ones, the devastating second wave of COVID-19 that has swept across South Asia has felt ¬surreal. Official figures have indicated record-breaking daily coronavirus cases and deaths, not only in South Asia, but across the entire Asia-Pacific region during the latest surge. As devastating as it has been, the truth is we may never know how many people have died during the pandemic.


Armida Salsiah Alisjahbana

Underreporting of deaths is common across the Asia-Pacific region, with an estimated 60 per cent of deaths occurring without a death certificate issued or cause of death recorded. One reason for this is the lack of a coordinated civil registration system to accurately record all vital events. This issue is exacerbated in times of crisis, as many of the poor die as they lived: overlooked or without being officially counted.

Civil registration and vital statistics (CRVS) systems record deaths and other key life events such as births and marriages. A complete approach to civil registration, tracking vital statistics and identity management relies on multiple arms of government and institutions working together to collect, verify and share data and statistics so they are reliable, timely and put to right use. Without such official data and records during catastrophes such as a pandemic, we see how fast people get left out of extended social protection, vaccination drives and emergency cash transfers. Conversely, it significantly limits the ability of the most vulnerable groups to claim this access and their rights.

The need for accurate data and reporting mechanisms is critical at all times and even more crucial during humanitarian situations, whether a natural disaster or health emergency, when urgent decisions are required and hard choices have to be made. Governments, health authorities and development partners need timely and complete data to know the extent of the issue. This data can guide evidence-based decisions on where resources should be deployed and assess which interventions have been most effective. The more complete, accurate and trustworthy the data, the better the decisions. Or at least, the leadership is unable to use the excuse of ”we did not know.”

Kanni Wignaraja

In 2014, the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) convened the first Ministerial Conference on Civil Registration and Vital Statistics, during which the Asian and Pacific CRVS Decade (2015-2024) was declared. Governments later set a time frame for realizing their shared vision – that all people in the region will benefit from universal and responsive CRVS systems.

These are complex and vast systems that need both technological and human capabilities to do it correctly, and the political commitment to sustain the effort. Development partners, including ESCAP, the United Nations Development Programme (UNDP) and the United Nations Children’s Fund (UNICEF), continue to actively work with governments and institutions to support the development of national civil registration systems, vital statistics systems and identity management systems such as national population registers and national ID card schemes.

A challenge facing governments has been transitioning from a standalone paper-based registration system to an integrated and interoperable digital one. UNICEF has worked with countries in the region on the registration of newborns, digitalization of old records and creation of integrated digital birth registration systems. UNICEF is also working with the World Health Organization (WHO) to improve integration of health services and civil registration, allowing governments to provide uninterrupted civil registration services and respond faster to health priorities, especially during crises.

Omar Abdi

UNDP and UNICEF play leading roles in implementing the UN Legal Identity Agenda, which aims to support countries in building holistic, country-owned, sustainable civil registration, vital statistics and identity management systems. Recognizing the importance of protecting privacy and personal data, UNDP advises countries on the appropriate legal and governance framework and has been engaged in supporting civil registration, national ID cards and legal identity in countries.

It is clear from the report by ESCAP, Get Every One in the Picture: A snapshot of progress midway through the Asian and Pacific CRVS Decade, that many countries in our region have seen improvements. However, we need to do more to ensure that all countries are able to produce reliable official statistics. And to use this to also learn and look forward.

The human toll of the COVID-19 crisis has been immense with far reaching consequences for the most vulnerable families. To respond effectively to disasters and build back better, it is time we get everyone in the picture.

Armida Salsiah Alisjahbana is the Executive Secretary of the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP)

Kanni Wignaraja is the Director of the UNDP Regional Bureau for Asia and the Pacific, UNDP
Omar Abdi is the Deputy Executive Director of Programmes, UNICEF

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From Climate Change to Covid, Are We Ready to Deal with Disasters?

Civil Society, Climate Change, Education, Environment, Food Security and Nutrition, Gender Violence, Global, Headlines, Health, Humanitarian Emergencies, Labour, Migration & Refugees, Sustainability, TerraViva United Nations, Water & Sanitation

Opinion

Credit: Bibbi Abruzzini

PARIS, Jun 10 2021 (IPS) – In the last 20 years, disasters affected over 4 billion people. At global level we witness on average one sweeping disaster a day, the majority of which are floods and storms. From the Covid-19 pandemic to climate change, calamities are taking new shapes and sizes, infiltrating every dimension of society. From the emotional to the political, how do we deal with disasters? How can we create a whole-of-society approach to disaster risk reduction?


Right through this vortex of intersecting crises, a new toolkit and interactive website by Forus, the Global Network of Civil Society Organizations for Disaster Reduction (GNDR), Save the Children Switzerland and Inventing Futures, with the support of Fondation de France, looks at how civil society organisations coordinate disaster risk reduction and post-emergency interventions. Meant for civil society networks, activists, government officials and community-based organizations, the toolkit provides best-practices from around the globe.

“Today, we are all actors and victims of crises. How can we better understand and learn to cope with them? These practical tools allow us to discover the stakes, the exemplary actions and their effects, through simple definitions and concrete testimonies experienced by civil society,” says Karine Meaux, Emergency manager at Fondation de France.

“Building resilient communities in the face of natural and man-made hazards has never been more important. While disasters don’t discriminate, policies do. Together we can act and put pressure on decision-makers to promote a holistic approach to disaster prevention and reduction and truly people-centred policies,” says Sarah Strack, Director of Forus.

Civil society at the forefront of disaster management

From resilient communities in Nepal, to conflicts in Mali and peace processes in Colombia, the toolkit presents six approaches to disaster risk reduction gleaned from case studies compiled across the civil society ecosystem. The toolkit looks at various topics from capacity building, to local knowledge, resource mobilisation, partnerships with governments and long-term sustainable development and livelihood resilience, ensuring that communities ‘bounce forward’ after a disaster.

Credit: Bibbi Abruzzini

Specifically, the toolkit aims to clarify the crucial role frontline civil society organisations play in reducing the impacts of disasters in the midst of an expanding and intensifying global risk landscape. Bridging governments, communities and experts is the only way we can tackle the multiple ways disasters affect local and social processes such as education, migration, food security and peace. If civil society is not free to operate – or even exist – our collective capacity to deal with disasters and create long-term resilience is hampered.

“You have countries [in the region] in which civil society is not even allowed to exist. This reality changed a lot after the Arab Spring, with countries living in a terrible crisis, with military conflicts, where the role of civil society now is not only to struggle for their existence, but also to provide the population with basic needs and humanitarian interventions,” says Ziad Abdel Samad, Director of the Arab NGO Network for Development (ANND).

Everyday disasters and inequalities

Robert Ninyesiga, from UNNGOF, the national civil society organisation platform in Uganda, argues that in most cases, “more effort has been put towards disaster response while neglecting the disaster prevention aspect”.

This therefore calls for continuous intentional awareness and capacity building as regards to disaster prevention and this can only be effectively achieved if sustainable partnerships between central governments, local governments, civil society organisations, media and citizens are strengthened.

Shock events, high-impact disasters, such as conflicts, earthquakes or tsunamis are just the tip of the iceberg. Underneath this layer there are an increasingly high number of “everyday disasters” affecting people around the globe. Localised, small scale, and slow onset disasters are often “invisible” – far from the spotlight. Those at low incomes are the most vulnerable and find themselves at the periphery of infrastructures, response systems and media attention.

For instance, in addition to being often exposed to intensive disasters such as floods and storms, residents in urban slums across Bangladesh are suffering much more than other communities since the outbreak of the Covid-19 pandemic.

Credit: Bibbi Abruzzini

“Most slum dwellers are daily wage earners, but they are not able to earn money. They are not able to maintain social distance, because in one room 4-5 members are living. Many people are using a shared bathroom. It’s very difficult to maintain hygiene. There is not enough space to sit or sleep at home while maintaining sufficient distance. Due to lack of money, many slum dwellers have only one or two meals a day. Violence and sexual harassment are increasing in the community due to cramped conditions. Children are not attending school,” explains the Participatory Development Action Programme (PDAP) which works in the slums of Dhaka .

These pressures add to regular “everyday” challenges of air pollution and garbage management, flooding, water-logged land, and poor quality water.

Local knowledge and Resilient Future

Civil society organisations often fill a tremendous gap and find themselves at the forefront of prevention and emergency efforts. The localisation of responses and partnerships are absolutely crucial to understand the needs of communities in pre and post-disaster scenarios.

In Honduras, civil society has created community-led interventions, to prioritise local plans of action across the country.

“Honduras, and Central America more in general, have been hit in the last 10 years by an intensification of disasters, most of them linked to climate change. Our role in helping communities to adapt to climate change and to deal with disasters, is in terms of capacity building, humanitarian assistance and advocacy by creating links between local, national, regional and global levels,” says Jose Ramon Avila from ASONOG, the national platform of civil society organisations in Honduras.

The intense and cascading nature of risks, such as seen in the cases of Covid-19 and climate change, represent a serious threat to the achievement of a sustainable and resilient future. Growing experience over the last three decades has revealed that disasters and development are closely linked. Ignoring the impact of disasters makes it more difficult to pursue sustainable development.

“Sustainable development can only be achieved when local risk is fully understood. Critical to understanding and assessing the complex threats and risks, challenges and opportunities faced by communities most at risk, is the need to partner with those people. This practical toolkit provides valuable insights and examples from GNDR members and others on how this can be achieved,” says Bijay Kumar, Executive Director, Global Network of Civil Society Organisations for Disaster Reduction (GNDR)

It has also been found that much of the negative impact on sustainable livelihoods comes not from large, ‘intensive’ disasters, but from many smaller, ‘everyday’ disasters. It has become crucial to address intensive and everyday disasters and to integrate our responses with overall work to pursue sustainable development.

We need to ask ourselves this question: can we build new bridges of solidarity between civil society, communities and governments? Can we prevent and anticipate disasters? Our future is not disaster-free; to build resilient communities it is crucial to nurture strong roots for our society to flourish.

The author Bibbi Abruzzini is Communications officer at Forus.
Find the toolkit and microsite on Disaster Risk Reduction here. Available in English, French and Spanish.

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‘Let’s Talk About Sex’ Discussion Highlights Risks to Women

Civil Society, Crime & Justice, Development & Aid, Economy & Trade, Gender, Gender Violence, Global, Headlines, Health, Human Rights, Humanitarian Emergencies, Poverty & SDGs, TerraViva United Nations, Women’s Health

Nordic Talk moderator Katja Iversen shown here with Natasha Wang Mwansa, Emi Mahmoud, Dr Natalia Kanem and Flemming Møller Mortensen during a recent Nordic Talks webinar. Credit: Shuprova Tasneem

DHAKA and NEW YORK, Jun 4 2021 (IPS) – Every two minutes, a girl or woman dies from pregnancy or childbirth-related complications, including unsafe abortions. Every year, around 12 million girls are married while in their childhoods. An additional 10 million are now at risk of child marriage due to the Covid-19 pandemic.


In this context, the most recent Nordic Talk—a high-level debate on bodily autonomy and sexual and reproductive health and rights (SRHR) as a cornerstone of gender equality, aptly titled “Let’s Talk About Sex” — could not have come at a better time.

Moderator Katja Iversen, Dane of the Year (2018) and former CEO of Women Deliver, kicked off the discussion by focusing on the close link between bodily autonomy, gender equality, economic growth, and a healthy planet.

In an exclusive interview with IPS, Iversen said it was clear that “bodily autonomy for girls and women—in all their rich diversity—is political, social, economic and health-related.”

Women needed to have power and agency over their “bodies, fertility, and future, living a life free of violence and coercion in both the private and public sphere. It ties into norms, structure, systems – and if we want equity and health for all, we need to address all of it.”

Emi Mahmoud, two-time World Champion Poet and Goodwill Ambassador for the UNHCR, set the tone for the Nordic Talk with her emotive poetry reflecting women’s experiences in patriarchal societies, asking: “What survivor hasn’t had her struggle made spectacle?”

The three other panellists agreed that the right to control their bodies was a fundamental aspect of women’s rights and that gender equality was an essential part of the sustainable development agenda.

As Dr Natalia Kanem, Executive Director of the UNFPA, explained that “(women’s) freedom over her own body means freedom of choice”, and that all the data points towards how investment in SRHR could be the first step to empowering women to “ultimately contribute to sustainable development.”

It was critical that SRHR was adequately resourced – but warned these would be in short supply because of the COVID pandemic recovery plans.

“Part of the financing challenge is what we abbreviate as political will. It actually does not cost a lot for the agenda for SRHR to be a reality by 2030. It would take $26 billion a year to end the unmet need for contraception and to stop mothers dying at birth, many of whom were too young to be pregnant, but resources are going to be a challenge now with Covid having affected the world economies.”

While Flemming Møller Mortensen, Danish Minister for International and Nordic Development and Nordic Cooperation, expressed optimism regarding resources for SRHR now that “the US is back on track” and the global gag rule had been revoked. He was worried about a growing conservatism and pushback against women’s rights, particularly in the pandemic’s wake.

Iversen told IPS the cuts in various countries could be devastating.

“UNFPA estimates that with the $180 million the UK wants to withdraw from the Supplies Partnership, UNFPA could have helped prevent around 250,000 maternal and child deaths, 14.6 million unintended pregnancies and 4.3 million unsafe abortions. We will need foundations and other donor countries to step up, and we will need national government step up and step in and ensure that their national budgets reflect and fill the SRHR needs.”

She expressed concern that women on COVID-19 decision-making bodies were unrepresented.

“Less than 25% of national COVID-19 decision-making bodies have women included. It is too easy to cut resources from people who are not at the decision-making tables,” she said. “We urgently need to get a lot more women into leadership, including of the COVID-19 response and recovery efforts. All evidence shows that when more women are included in decision-making, there is a more holistic approach and both societies and people fare better.”

This call for inclusivity, not just for women but for the youth, was strongly echoed by adolescent sexual and reproductive health rights expert Natasha Wang Mwansa.

“So many commitments have been made by so many countries, yet there is no meaningful progress or accountability, and young people are not involved when making these decisions,” Mwansa said. “Young people are here as partners, but we are also here to take charge. From making choices over our own bodies to choices on our national budgets, we are ready to be part of these decisions.”

To deal with challenges in providing access to SRHR, Kanem stressed the importance of gender-disaggregated data for planning. She added that despite the hurdles, she was hopeful about the future because “young people and women are not waiting to make the case and show solidarity and understanding when it comes to racism or issues of discrimination and equity that divide us.”

Iversen echoed this optimism in her IPS interview.

“It gives me hope that comprehensive sexual and reproductive health services are included in the roadmap for Universal Health Coverage, in the Global Action Plan for Healthy Lives and Well-being, and latest in the Generation Equality Forum blueprint,” she said.

“Civil society has played a key role in ensuring this with good arguments, data and a lot of tenacity. But words in the big global documents about Health For All is one thing; gender equality and women’s rights, if it has to matter, it has to manifest in concrete action.”

The conversation rounded off with recommendations and commitments from the panellists: Mwansa stressed more investments in youth-run organisations and more social accountability from decision-makers; Mortensen asked for governments to be held accountable and for youth voices to be heard; and Kanem reaffirmed the UNFPA’s goal to put family planning in the hands of women as a means of empowerment, to end preventable deaths in pregnant women and girls, and change fundamental attitudes to end gender-based violence.

In her final comments to IPS, Iversen also stressed the importance of SRHR as a means of empowerment.

“Study after study shows that it pays to invest in girls, women and SRHR – socially, economically and health-wise. But we cannot look at SRHR alone; we need a full gender lens to the COVID response and recovery and development in general,” she said.

“And if we want to see positive change, we have to put girls and women front and centre of coronavirus response and recovery efforts, just as we, in general, need to see many more women in political and economic leadership.”

The Nordic Council of Ministers supports the Nordic Talks, and “Let’s Talk about Sex” was organised in partnership with UNFPA, the Danish Ministry of Foreign Affairs, Generation Equality, the Danish Family Planning Association, and Mind your Business, as a lead up to the Paris Generation Equality Forum.

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Global Austerity Alert: Looming Budget Cuts in 2021-25 and Alternatives

Aid, Civil Society, Development & Aid, Economy & Trade, Financial Crisis, Global, Headlines, Health, Humanitarian Emergencies, Inequity, TerraViva United Nations

Opinion

Map of countries with projected austerity cuts in 2021-2022, in terms of GDP, based on IMF fiscal projections. Credit: I. Ortiz and M. Cummins, 2021

NEW YORK and NAIROBI, Apr 15 2021 (IPS) – Last week Ministers of Finance met virtually at the Spring Meetings of the International Monetary Fund (IMF) and the World Bank to discuss policies to tackle the pandemic and socio-economic recovery.


But a global study just published by the Initiative for Policy Dialogue at Columbia University, international trade unions and civil society organizations, sounds an alert of an emerging austerity shock: Most governments are imposing budget cuts, precisely at a time when their citizens and economies are in greater need of public support.

Analysis of IMF fiscal projections shows that budget cuts are expected in 154 countries this year, and as many as 159 countries in 2022. This means that 6.6 billion people or 85% of the global population will be living under austerity conditions by next year, a trend likely to continue at least until 2025.

The high levels of expenditures needed to cope with the pandemic have left governments with growing fiscal deficit and debt. However, rather than exploring financing options to provide direly-needed support for socio-economic recovery, governments—advised by the IMF, the G20 and others—are opting for austerity.

The post-pandemic fiscal shock appears to be far more intense than the one that followed the global financial and economic crisis a decade ago. The average expenditure contraction in 2021 is estimated at 3.3% of GDP, which is nearly double the size of the previous crisis. More than 40 governments are forecasted to spend less than the (already low) pre-pandemic levels, with budgets 12% smaller on average in 2021-22 than those in 2018-19 before COVID-19, including countries with high developmental needs like Ecuador, Equatorial Guinea, Kiribati, Liberia, Libya, Republic of Congo, South Sudan, Yemen, Zambia and Zimbabwe.

The dangers of early and overly aggressive austerity are clear from the past decade of adjustment. From 2010 to 2019, billions of people were affected by reduced pensions and social security benefits; by lower subsidies, including for food, agricultural inputs and fuel; by wage bill cuts and caps, which hampered the delivery of public services like education, health, social work, water and public transport; by the rationalization and narrow-targeting of social protection programs so that only the poorest populations received smaller and smaller benefits, while most people were excluded; and by less employment security for workers, as labor regulations were dismantled. Many governments also introduced regressive taxes, like consumption taxes, which further lowered disposable household income. In many countries, public services were downsized or privatized, including health. Austerity proved to be a deadly policy. The weak state of public health systems—overburdened, underfunded and understaffed from a decade of austerity—aggravated health inequalities and made populations more vulnerable to COVID-19.

Today, it is imperative to watch out for austerity measures with negative social outcomes. After COVID-19’s devastating impacts, austerity will only cause more unnecessary suffering and hardship.

Austerity is bad policy. There are, in fact, alternatives even in the poorest countries. Instead of slashing spending, governments can and must explore financing options to increase public budgets.

First, governments can increase tax revenues on wealth, property, and corporate income, including on the financial sector that remains generally untaxed. For example, Bolivia, Mongolia and Zambia are financing universal pensions, child benefits and other schemes from mining and gas taxes; Brazil introduced a tax on financial transactions to expand social protection coverage.

Second, more than sixty governments have successfully restructured/reduced their debt obligations to free up resources for development. Third, addressing illicit financial flows such as tax evasion and money laundering is a huge opportunity to generate revenue. Fourth, governments can simply decide to reprioritize their spending, away from low social impact investments areas like defense and bank/corporate bailouts; for example, Costa Rica and Thailand redirected military expenditures to public health.

Fifth, another financing option is to use accumulated fiscal and foreign reserves in Central Banks. Sixth, attract greater transfers/development assistance or concessional loans. A seventh option is to adopt more accommodative macroeconomic frameworks. And eighth, governments can formalize workers in the informal economy with good contracts and wages, which increases the contribution pool and expands social protection coverage.

Expenditure and financing decisions that affect the lives of millions of people cannot be taken behind closed doors at the Ministry of Finance. All options should be carefully examined in an inclusive national social dialogue with representatives from trade unions, employers, civil society organizations and other relevant stakeholders.

#EndAusterity is a global campaign to stop austerity measures that have negative social impacts. Since 2020, more than 500 organizations and academics from 87 countries have called on the IMF and Ministries of Finance to immediately stop austerity, and instead prioritize policies that advance gender justice, reduce inequality, and put people and planet first.

Isabel Ortiz is Director of the Global Social Justice Program at Joseph Stiglitz’s Initiative for Policy Dialogue at Columbia University, former Director at the International Labour Organization (ILO) and UNICEF
Matthew Cummins is senior economist who has worked at UNDP, UNICEF and the World Bank.

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Debt Moratoria in the Next Pandemic: Be Prepared, and Be Fair

Aid, Civil Society, Featured, Global, Headlines, Human Rights, Humanitarian Emergencies, Poverty & SDGs, TerraViva United Nations

Opinion

Credit: Temilade Adelaja via Communication for Development Ltd/CGAP, Washington DC

WASHINGTON DC, Mar 25 2021 (IPS) – Imagine it is 2025 and that, unfortunately, another pandemic is sweeping the world. Much like in the 2020 crisis, borrowers have seen their livelihoods upended and are struggling to repay loans.


One of the questions before policy makers amid this new crisis is whether to extend moratoria to distressed borrowers. In search of answers, they reflect on the world’s experience with the COVID-19 pandemic and whether moratoria were part of the solution. These policy makers conclude that they did some things right in 2020.

Just days into COVID-19 lockdowns, bank regulators in more than 115 countries granted special permission for financial services providers (FSPs) to extend moratoria to millions of borrowers, especially those with small business and consumer loans. These moratoria were the next best thing to cash in the wallet for borrowers who had lost their jobs or seen their business revenue plummet.

For lower-income countries, whose governments could ill afford welfare payments, moratoria became an important form of economic relief. And by relaxing provisioning on paused loans, these special moratoria also shored up FSPs’ balance sheets and prevented panic in financial systems.

Through the moratoria, the world’s economies put the shock-absorbing capacity of financial systems to good use.

But these policy makers also see that moratoria could have worked better in some respects. So, in 2025, as the world once again turns to moratoria, they are determined to learn the lessons of the past and make moratoria work even better. What do they do differently?

Fair burden sharing

As public health authorities shutter the economy to stop the new pandemic, advocates for lower-income people are already calling on policy makers to spread the economic burden among those better able to bear it.

Policy makers know that moratoria on small loans (as well as evictions and mortgages) will shift some economic pain from lower-income families and small businesses onto banks and landlords — at least, temporarily.

But they recall that, in 2020, FSPs shifted the pain back to small borrowers by allowing interest to accrue and compound during moratoria. Ultimately, borrowers paid to pause their loans – often dearly.

Back in 2020, policy makers debated whether to shift some of the long-term burden of accrued and compounding interest away from borrowers, but it was difficult for them to find a workable solution.

In India, after much debate in the Supreme Court over who should pay this additional interest, the government found a remedy when it agreed to pay banks the compounding portion of borrowers’ interest incurred during moratoria. Implicitly, this decision made moratoria part of the government’s overall pandemic response while affirming the right of the banks to charge fully for delayed payments.

Fortunately, in 2025, several governments have included special provisions in their catastrophe protocols that pledge government funding for a portion of the interest that small loans accrue during moratoria.

This pledge helps to ensure policies intended to help low-income people don’t end up harming them. It has the added benefit of providing banks with a small amount of liquidity during the moratoria period.

Moratoria will also be fairer this time around because policy makers have universally agreed that borrowers should have the right to choose whether to accept or reject a moratorium offer. This was not always the case in 2020.

In some countries, regulators — anxious to prevent panic — and FSPs — wishing to avoid tedious case-by-case administration — promulgated blanket moratoria, even before obtaining agreement from borrowers.

However, some borrowers preferred to keep paying to avoid extra interest charges. In response to push back from borrowers on unilateral moratoria, authorities in Peru affirmed consumers’ right to unwind unwanted moratoria. Today, following this example, regulators the world over require FSPs to notify borrowers of moratoria offers and present them with the option to refuse.

Policy makers have also anticipated the challenge of maintaining borrowers’ standing with credit bureaus. When borrowers accept moratoria during a national emergency, it should not hurt their creditworthiness.

In 2020, there was confusion over how banks should report restructured loans to credit bureaus, how credit bureaus were to incorporate these loans into credit scores, and how new lenders were to use the information.

In India, FSPs simply didn’t report many loans for several months. Eventually, those problems were sorted out. Now, in 2025, credit bureaus follow well-understood protocols for handling loans in moratoria during emergencies.

Preparedness

The emergency protocols that the world’s banking authorities and FSPs put in place after the COVID-19 pandemic also address operational continuity and communications.

Back in 2020, economic lockdowns prevented in-person interactions between lenders and borrowers and often led to breakdowns in communication. In Uganda, loan officers could not meet with customers in the field, and transport restrictions prevented adequate staffing of branches and even call centers. FSPs transacting mainly in cash were caught especially flat-footed.

Thankfully, this problem is behind us now. The pandemic accelerated FSPs’ digitization plans across the world, and record numbers of borrowers started using mobile technology. FSPs serving lower-income customers now routinely communicate and transact digitally.

They have also upgraded their internal systems to handle the irregular schedules of loans in moratoria. And the expansion of digital infrastructure during and after COVID-19 now allows staff to work from home.

Consumer protection

As financial regulators and supervisors prepare for the new moratoria in 2025, they are better equipped to mitigate some of the consumer risks that appeared in 2020. They now use market monitoring tools, such as suptech, consumer phone surveys and mystery shopping, to assess consumer risks in real time. They can quickly spot issues such as abusive collections practices.

Nevertheless, both financial authorities and FSPs have learned from the previous crisis that ensuring good communication and transparency will be challenging. Moratoria are unfamiliar concepts, and the math is complicated.

Learning from 2020, when poor communication led to misunderstandings, mistakes and abuse, regulators have already issued consumer protection rules to ensure the public fully understands moratoria offers and their consequences.

Additionally, communications now flow not just to customers, but also from them. Policy makers are widely using tools that give consumers a collective voice and reveal what they are experiencing.

Several regulators have put consultative bodies in place to have a regular dialogue with consumers, and consumer associations regularly convey issues to them. Such tools proved useful in 2020.

In Peru, for example, the consumer protection agency INDECOPI listened systematically to customers and alerted regulators and FSPs to emerging abuses so that they could respond quickly.

Agility

The COVID-19 pandemic lasted much longer than anyone foresaw, and unanticipated implementation challenges arose. If policy makers learned one thing, was is that you can never anticipate all the ways an emergency will unfold.

Accordingly, the countries that were best prepared for the next pandemic were those that had established channels for authorities and FSPs to work together to respond to evolving conditions.

Source: Consultative Group to Assist the Poor (CGAP) is a global partnership of more than 30 leading development organizations that works to advance the lives of poor people through financial inclusion.

*Elisabeth is the former managing director of the Center for Financial Inclusion at Accion. She is a visiting fellow at the Financial Access Initiative and a consultant at CGAP.

*Eric Duflos, Senior Financial Sector Specialist, leads CGAP’s work on consumer protection, from policy, industry and customer perspectives, ensuring that financial services have positive outcomes for customers.

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