Poverty 'worsening' in Asia-Pacific

Espac says the global economic downturn is leading to worsening poverty levels [EPA]


Al Jazeera
Thursday, March 26, 2009

A United Nations reports says poverty is worsening in the Asia-Pacific region due to the global economic crisis.

Unstable food prices and climate change are contributory factors, the report by the UN Economic Social Commission for Asia and the Pacific (Espac) says.

The report, entitled Addressing Triple Threats to Development, was released on Thursday in over 20 cities across the region.

Among other things, Espac said that food and fuel prices rose dramatically in 2008.

It also said that record high oil prices last year contributed to an increase in the price of rice up by 150 per cent.

Rice is the region's staple, so price increases have hit the poor the hardest.

That triggered an increase in the number of undernourished people to 583 million.

'Triple threat'

The Espac report urged governments not to forget two "longer term crises", while dealing with the global economic downturn.

Food-fuel price volatility and climate change are converging with the economic crisis to create what Espac has labelled as "the triple threat".

"With almost two-thirds of the world’s poor and half of its natural disasters, Asia and the Pacific is at the epicentre of the triple crises," a press statement said.

The Espac report calls for 'adequate social protection system' to fight poverty [EPA]

The report also claims that the triple crises are "interlinked" and are reinforcing the impact of each other.

At the same time, studies have shown that natural disasters disproportionately affect the poor and the most vulnerable.

Asia is the most disaster-prone region in the world, and experiences almost half of global natural disasters. The region was home to almost 98 per cent of worldwide fatalities from natural disasters in 2008.

The Espac report says that climate change threatens to further magnify the vulnerability of the poor by increasing the frequency and severity of natural disasters and crop failures in the region.

Noeleen Heyzer, the UN undersecretary-general and executive secretary of Escap,
told Al Jazeera that an "inadequate social protection system will make matters worse for the poor".

"Unfortunately, this is a region where, despite its economic growth, there is growing disparity".

Social protection

To illustrate her point, Heyzer said about 20 per cent of the population have access to health-care systems and "at the same time, if we look at the elderly, 30 per cent of will have access to pension schemes.

"Therefore the need to strengthen social protection systems as a way of stiumlating domestic demand, stimulating the economy and ultimately increasing income security and the feeling of security in our population is vital."

This is the second time in a decade Asia and the Pacific has been hit by a financial crisis.

Asian crisis experience

The Espac report says measures undertaken since 1997 made the Asia-Pacific region more resilient at the beginning of the current crisis.

Those steps involved the implementation of macroeconomic policies, banking reforms and foreign exchange reserve accumulation.

But that resilience started to erode when, in the fourth quarter of 2008, trade, the region’s most important sector, moved from double digit growth to double digit declines.

"The fact is that the Asia-Pacific region is more economically integrated with the rest of the world then with itself," Heyzer said.

"Intra-regional trade among developing countries accounts for only 38 per cent of exports in the region, compared with Nafta [The North American Free Trade Agreement] at 51 per cent and the European Union at 68 per cent."