Steeper climb to human progress

The PHL, which with Indonesia was hardest hit by Covid-19 in Asean, may see hard-won gains in poverty reduction eroded, and already problematic health care system further burdened, says the Unescap.

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DECADES of hard-won gains in poverty reduction are being eroded by the Covid-19 pandemic, even as governments like that of the Philippines have extended billions in cash transfers to the most vulnerable, United Nations experts fear.

In its latest policy brief on the coronavirus disease (Covid-19) and Southeast Asia, the UN Economic and Social Commission for Asia and the Pacific (Unescap) said without alternative incomes and weak social protection systems, many informal workers would be pushed into poverty.

Based on the report, the Philippines and Indonesia were the most affected by the Covid-19 pandemic in Southeast Asia in terms of reported fatalities.

“The crisis threatens to destroy the livelihoods of Southeast Asia’s 218 million informal workers, who represent anywhere between 51 and 90 percent of the national non-agricultural workforces in countries of the subregion,” the policy brief stated.

“Without alternative income, formal social protection systems or savings to buffer these shocks, workers and their families will be pushed into poverty, reversing decades of poverty reduction,” it added.

Philippine authorities, meanwhile, would rather not be daunted. National Economic and Development Authority (Neda) Undersecretary for Planning and Policy Rosemarie G. Edillon said that while it is possible that poverty would increase, such increase could be tempered by efforts of the Philippine government.

In a press briefing on Thursday, Edillon explained that poverty can be related to income which is linked to a person’s employment or ability to earn a living, while the other is related to purchasing power.

She said the government’s approach has been two-pronged in the way that it has extended the Social Amelioration Program (SAP) to cover the bottom 70 percent of the population, including the poor and near-poor.

In terms of purchasing power, Edillon said the government has ensured that inflation remained benign despite the setbacks in logistics encountered at the start of the lockdowns.

She said agencies—the Department of Agriculture in particular—have stepped up to quickly help their constituencies. The DA quickly moved to help farmers sell their products even during the lockdown, dealing with the twin problems of averting total poverty and hunger among farming communities while also preventing long disruptions in the food supply chain for urban areas that rely on the farmers’ produce.

“We still need the data [to determine the impact on poverty]. There will be an [increase] in poverty due to the reduction in income. But this will be addressed by [government] efforts,” Edillon said.

Pandemic problems

APART from poverty, Unescap said the Philippines will be significantly affected not only in terms of the economy but in health and social factors.

In terms of the economy, being one of the world’s largest labor exporters, the country would see a significant decline in remittances, Unescap said.

The agency sees up to 500,000 overseas Filipino workers (OFWs) could come home due to the impact of the lockdowns in their host countries. At a recent virtual Senate hearing, the Department of Labor and Employment (DOLE) had said over 300,000 OFWs have thus far reported themselves displaced, though about a third indicated they would rather tough it out in their host countries, in hopes of landing other jobs once quarantines ease. The DOLE and the Department of Foreign Affairs (DFA) have repatriated more than 100,000 OFWs as of last week.

The OFWs’ problems will largely affect consumer spending in the country, with the Philippine economy being a consumption-driven one, and the services sector having been boosted in past decades with robust spending by remittance-fueled OFW families.

With OFWs coming home and mobility restrictions affecting labor, Unescap said the country’s full-year unemployment rate may increase by 1.2 percentage points this year.

“This will compound the effect of lack of remittances and increase the unemployment burden at national levels. Returning migrants who have yet to pay off their debts to recruiting agents or money lenders will be particularly vulnerable to exploitation and abuse and will be among those most in need of services and support,” Unescap said.

Health setbacks

In terms of health and social setbacks, Unescap said with limitations on the movement of aid workers, 2 million children in the Philippines below the age of two may not be vaccinated and protected from preventable diseases this year.

These preventable diseases include measles, dengue and polio, which has resurfaced in the Philippines. The country last year saw its first polio outbreak decades after it officially became polio-free.

The Unescap said the Covid-19 situations in the Philippines and Myanmar are “particularly concerning” given the weakness of the health-care system.

In a recent briefing, Unescap Executive Secretary Armida Salsiah Alisjahbana told reporters that based on data from the Philippines, the country only had a few nurses and midwives as well as hospital beds.

Data presented by the Unescap showed there were an average of only two nurses and midwives and 10 hospital beds per 10,000 people between 2010 and 2018.

However, in terms of physicians, the number was not as low, at around 12 physicians per 10,000 people during the same period. Health expenditure was also low at 4.4 percent of GDP as of 2016.

“Among the 11 countries covered in this brief, the situation is particularly concerning for Myanmar and the Philippines, which have pre-existing humanitarian caseloads, and have therefore been incorporated in the recently launched Global Humanitarian Response Plan,” Unescap said.

Apart from this, Unescap pointed out the fact that mass testing for Covid-19 in the Philippines was not yet available, with only a few local governments giving free testing, unlike in other Asian countries like South Korea and Vietnam. This means there is a need for more granular data to understand the situation at the local level.

Unescap said better epidemiological data is needed, especially in highly populated areas such as megacities like Metro Manila.

On average, it took Southeast Asian countries 17 days to declare a state of emergency or lockdown after 50 cases were confirmed. This was done by many Southeast Asian countries quickly because of mass testing.

“In some [countries], such as the Philippines, mass testing is not yet available. This may be leading to under-detection and a lower capacity for monitoring the evolution of the epidemic,” Unescap said.

A cure

MOVING forward, UN Secretary General António Guterres said four areas will be critical in the region’s plans for recovery: tackling inequality, bridging the digital divide, greening the economy, and upholding human rights and good governance.

Increased investments to strengthen health systems and accelerate progress toward universal health care will be critical to support those excluded from formal policy and social protection measures.

Digital technology has also proven to be a critical tool in response to the pandemic. However, the benefits it offers are beyond the reach of the 55 percent of Southeast Asia’s population who remain offline.

A regionally coordinated and scaled up effort is needed to put in place next-generation infrastructure networks and ensure universal digital connectivity, highlights the brief.

Alisjahbana also said the crisis presented an opportunity for countries to reorient their development toward sustainability, particularly through green recovery packages.

Stimulus packages should be directed to industries that are low-carbon, resource-efficient and aligned with environmental and climate objectives.

Based on the data presented by the Unescap, the Philippines’s response to Covid-19 only covered cash transfers. The government’s stimulus package has yet to be approved by Congress.

By phasing out fossil-fuel subsidies, Alisjahbana said countries could finance most or all of their current stimulus packages. Such measures would create massive fiscal space and greatly boost low-carbon alternatives such as renewable energy and energy efficiency.

Image credits: AP/Aaron Favila

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