Information and news about economic crisis

Argentine Debt AgreementArgentina has been facing a long-lasting economic crisis, further amplified by the COVID-19 pandemic. Close to half of the population lived in poverty in the second quarter of 2020, reaching an all-time high during the months of mandatory lockdowns. Due to the pandemic, the country also experienced a loss of 3.5 million jobs and unemployment rose to 13.1% in the second quarter since the closures hit small businesses hard. As a result, the impact of COVID-19 significantly hurt the domestic market. The Argentine debt agreement hopes to improve the financial crisis in Argentina.

The Argentine Debt Agreement

To help Argentina with its growing financial crisis, the Ad Hoc Group, Argentina Creditor Committee and the Exchange Bondholder Group have come to an agreement that will provide Argentina with financial relief in terms of its national debt. This relief is a major advancement in expanding Argentina’s access to international capital markets. The agreement lays the foundation for future sustainable fiscal policies that support the economy. Moreover, the debt agreement entails a lift of sovereign bonds by an average of 8.7%. Ultimately, Argentina is actively working toward providing sufficient cash flow within the economy to address rising economic concerns. This agreement also allows Argentina to avoid “protracted and costly legal proceedings with bondholders.”

Restructuring the Economy

The three creditor groups developed the debt agreement to restructure $65 billion worth of accumulated Argentinian debt. The creditors involved will receive 55 cents on the U.S. dollar. Originally, the president of Argentina, Alberto Fernandez, desired to pursue 39 cents. The Argentine debt agreement covers 20% of the public debt of Argentina, which amounts to $323 billion. This presents only a partial solution to Argentina’s financial crisis but will certainly help the country move toward economic stability.

If Argentina defaults on the debt, there are possible consequences. By defaulting, creditors will not be eager to invest in Argentina. Diminishing debt through repayment shows commitment but will lead to less investment in the domestic development of the country through social programs, pension benefits, unemployment packages and more. However, the agreement is a step toward solving the rest of the economic dilemma. It utilizes the restructuring method, which provides Argentina with a long-term plan for rebuilding the economy.

Moreover, the agreement modifies the dates of payment for certain bonds. The modification that will be implemented “will improve the value of the proposal for creditors.” Multifarious investors are interested in the profit restructuring will produce and are betting on a boost in the economy.

Negotiating Future Monetary Policies

Argentina’s debt restructuring does not end there. Argentina and the International Monetary Fund (IMF) will discuss Argentina’s plans on refinancing its $45 billion debt to the IMF. The focus will mostly be on loans maturing between 2021 and 2024. During this period, the International Monetary Fund will hold Argentina accountable for certain economic obligations. This accountability entails that Argentina must utilize “credible economic data” as proof of Argentina’s economic recovery path.

The Road Ahead

Debt relief is an effective solution to addressing Argentina’s financial crisis and rebuilding a resilient economy. Negotiations with creditors involve the nation requesting reasonable interest rates from now on, which will allow Argentina to truly stabilize. The agreement is very desirable as Argentina is also navigating the added impacts of COVID-19. In general, this revamped economic plan will not solely benefit Argentina but also the international financial system. By setting new precedents, Argentina can effectively re-enter the global market, ultimately contributing to global economic growth as a result.

Lauren Tabor
Photo: Flickr

Economic Growth in 2020
“Everyone is growing.” At the end of 2019, this was the World Bank’s outlook of the economic trajectory for the year 2020. The global economy was steadily growing and strengthening, and only a select few countries were facing GDP and economic contractions. Here is a look at the countries that experienced economic growth in 2020.

COVID-19’s Impact on the Economy

At the end of 2020, the World Bank sang a much different tune than what it did at the end of 2019. After the onset of a global pandemic, the majority of the world’s economies have taken a turn for the worst, the year turning out to be one of the worst in terms of economic growth and development. A far cry from the projected global GDP growth of 2.5%, as in June 2020, the International Monetary Fund (IMF) predicted that the world would close out the year with a GDP growth rate of -4.9%.

For some countries such as Spain, the U.K. and Tunisia, economic growth in 2020 had already fallen by around 20% by the year’s second quarter compared to the same period of 2019, a record quarterly fall for many countries. In other countries such as Taiwan, Finland, Lithuania and South Korea, the economic impact was much less than 5% contractions in GDP.

However, while the problem of economic recession was common for most nations, there were a select few that were not only able to ward off a negative growth pattern but steadily grew in the face of a global crisis. According to reports from the International Monetary Fund (IMF), in October 2020, only 16 countries would sustain economic growth in 2020 of more than 1%, and 11 would grow at a rate between zero and 1%. That leaves a whopping 167 nations facing economic contraction.

5 Countries that Experienced the Highest Economic Growth in 2020

  1. Guyana: Guyana currently has the fastest growing economy globally, with an economic growth rate of approximately 26.21% in 2020. The mainland country serves as home to one of the most promising newly discovered oil basins globally and a vast supply of other natural resources. The recent oil discoveries and new production began in late 2019. Guyana’s economy is expanding fast and expects the GDP to more than double by 2025. Therefore, while it is likely that the Guyanese economy did face setbacks due to the COVID-19 pandemic, the explosion of its oil industry has been able to keep the country’s economy heading in the right direction.
    2. South Sudan: After facing stunted economic growth in the 2010s due to civil unrest, the relatively newly independent South Sudan faced harsh humanitarian and food insecurity crises. However, in 2018, the country signed a new peace agreement, followed by the reopening of many of its oil wells, boosting its main revenue source. Between 2018 and 2019, the country gradually maneuvered itself back into a steady growth pattern that maintained a 4.11% growth in GDP in 2020.
    3. Bangladesh: Over the years 2016 to 2020, the Bangladesh economy has recorded a 7.6% growth in GDP. Such rapid expansion has allowed the country to graduate from the U.N.’s list of Least Developed Countries (LDC). Because of its now stable macroeconomic environment, buoyant domestic demand and export-oriented industry-led growth, Bangladesh has been able to maintain an approximate 5.2% growth rate during 2020, with predictions that it will see an increasing growth rate of 6.8% in 2021 and the coming years.
    4. Egypt: Similar to Guyana, the Egyptian economy has recently benefitted greatly from lucrative natural gas discoveries. Though the pandemic and global economic crisis hit the country’s economic growth in 2020 due to a sudden fall in tourism, remittances and exports, its previous main sources of income, the revenue from its oil discoveries, was enough to stabilize growth in the economy. Already, the Egyptian economy is on the path to recovery with a projected 2.76% growth in 2021, before returning to its previous growth levels averaging at 5.28% in the coming years.
    5. Benin: Due to intentional and effective key economic and structural reforms in recent years, Benin reached a growth rate of 6.41% between the years 2017 and 2019. Therefore, while economic activity did slow for the country heavily dependent on re-export and transit trade, it was able to sustain economic growth in 2020 at a rate of approximately 2%. As the world adapts to and moves towards the end of the pandemic and global economic crisis, expectations have determined that Benin’s economy will return to faster growth rates of around 5% to 7% in the upcoming years.

Looking Forward

It was low- and middle-income emerging economies that were better able to sustain a growth trajectory throughout the 2020 global economic crisis. In fact, China, which the COVID-19 pandemic hit first, has been the only trillion-dollar economy that sustained positive economic growth in 2020. Economic growth is crucial for reducing and eradicating poverty and can lead to social improvements in affected countries. Therefore, the hope is that the countries that are not on the above list will return to pre-pandemic growth rates, and the five fastest-growing nations of 2020 keep developing at this level.

– Rebecca Harris
Photo: Flickr

Electricity in VenezuelaOn March 7, 2019, Venezuela entered the worst power outage in the country’s history. Plunging all 23 states into darkness, the blackout lasted over five days in majority of the country. The economic losses triggered by this event exceeded $800 million and led to the deaths of an estimated 46 people. Electricity in Venezuela has since become a huge cause of concern for people.

Blackouts in Venezuela

Regrettably, this blackout was not an isolated incident, although it was the longest. Blackouts have become a routine aspect of Venezuelan life, dating back to as early as 2010. In a country where 96% of the Venezuelan population lives in poverty, these blackouts serve only to exacerbate the struggles of a vulnerable population. They strip people of access to basic necessities like water, food and fuel. Their root causes are often unclear although the key contributing factors are widely agreed-upon.

Understanding the Power System

In 2007, Venezuela’s private power companies were nationalized and transformed into one state-run monopoly known as Corpoelec. The company is underfunded, rife with corruption and unable to recover its own operating costs. The factors creating this untenable situation for Corpoelec date back even further to 2002 when national electricity rates were frozen. In Venezuela, “consumers pay only 20% of the real costs of producing power, delivering Venezuelans the lowest electricity prices in Latin America.” The drawback to these low rates is that energy is extremely overused and that Corpoelec is unable to generate sufficient revenue to fund infrastructure investments or even basic maintenance of its facilities.

Overdependence on Hydropower

The aforementioned problems are exacerbated by Venezuela’s near-complete reliance on hydropower from just one dam. The Guri Dam located in the eastern state of Bolívar accounts for 80% of the country’s electricity production and its systems are woefully neglected. The dam currently operates at a capacity considered unsustainable, “jeopardizing the machine room in the case of a flood,” according to experts. In a region where flooding is common, this is cause for concern.

Whereas other countries that rely heavily on hydroelectric power like Brazil and China have made large investments into other forms of energy, Venezuela’s ability to shift away from hydropower is crippled by underfunding, a lack of engineering power from within the country and corruption.

Corpoelec has stagnated progress as well. The company, “paid millions of dollars in no-bid contracts to political connections,” to maintain its dominance. Projects to build new dams and other forms of electricity production like thermal or wind have routinely been stalled due to a lack of funding and inadequate staffing.

The Cause of the Blackout

The March 7 blackout that heavily circulated the news was caused by a system failure at the Guri Dam. It was initially painted as a terrorist attack by president Nicolás Maduro, who tweeted, “The electrical war announced and directed by the imperialist United States against our people will be defeated.”

The Venezuelan president’s claim was that the U.S. had caused the power outage through a cyberattack on the hydroelectric plant. However, engineers who worked on the dam later clarified that the plant’s electronic monitoring system is not actually connected to the internet, proving a foreign attack to be an unlikely root cause. The plant has been poorly maintained and neglected for a very long time. In actuality, failure to properly manage the electricity grid may have caused a fire has been deemed the likely cause, and unfortunately, there is no quick-response system in place at the facility to protect its systems from damage.

The Future of Electricity in Venezuela

To ensure the return of consistent electricity to the people of Venezuela and protect against future blackouts, massive overhauls would be beneficial. However, such agendas seem unrealistic given the current economic and political climate in the country. Rather, a focus on increased upkeep and basic maintenance of power plants offers a more realistic path forward. This requires access for NGOs to bring in engineers and consistent revenue toward infrastructure repair. Without this basic funding and commitment from the government, the Venezuelan people will continue to suffer through blackouts.

– Scott Mistler-Ferguson
Photo: Flickr

Saving the Venezuelan EconomyA combination of poor leadership and crippling sanctions have created a nation-wide economic crisis in Venezuela. The Center for Strategic and International Studies found that even before U.S. sanctions were placed on Venezuela, the country was already enduring hyperinflation, had seen food imports fall by 71% and more than two million Venezuelans had fled the country. Nevertheless, sanctions only exacerbated the crisis as Torino Economics found U.S. sanctions on Venezuela were associated with an annual loss of $16.9 billion in oil revenue. As a result, the Atlantic Council reports that more than 80% of Venezuelan households are food insecure and 3.7 million individuals are malnourished. Consequently, refugees filed more asylum claims globally in 2018 than any other country has. The number of Venezuelan migrants and refugees is expected to reach eight million in 2020, surpassing Syrian migration by more than three million. Reforms in the county are being implemented with the aim of saving the Venezuelan economy.

Saving the Venezuelan Economy

While this economic collapse still ravishes the country, there is certainly hope for the future. Due to both internal and external pressures, the president of Venezuela, Nicolás Maduro, has begun to encourage policies of economic liberalization and privatization that are indicating an economic rebound.

Toward the end of 2019, Argus Media reported the Venezuelan government was beginning to ease economic controls. Specifically, the Maduro government erased most price controls, loosened capital controls, tightened controls on commercial bank loan operations, and most importantly, began to accept informal dollarization. Immediately these policies curbed the levels of hyperinflation that had caused the food crisis across the country. Advisers estimate inflation to be at only 5,500%, a significant improvement compared to the International Monetary Fund forecasts that predicted inflation levels of more than 10 million percent. This is largely in part to the importation of dollars into the Venezuelan economy, pushing out the uselessly-inflated Bolivars. Indeed, a Bloomberg study found Venezuela’s economy is increasingly dollarized, as 54% of all sales in Venezuela by the end of last year were in dollars. Most importantly, food and medicine imports have rebounded, now reaching 15% of the population.

Privatization of the Oil Industry

In addition to the Maduro government relaxing economic controls, the economic rebound in Venezuela has occurred due to increased privatization of the oil industry. Despite being under the control of the military for years, Venezuela’s state-owned oil company has trended toward letting private firms handle operations, aiding in fixing the mismanagement perpetrated by the military’s control of the industry. For the first time in decades, the private sector accounted for more than 25% of GDP in 2019 and likely more by the end of 2020. Consequently, the Panam Post reported that oil production increased by more than 200,000 barrels, a 20% increase following privatization.

Initiatives to Help Venezuelans in Poverty

The South American Initiative, through its medical clinic, provides medical care and medicine to Venezuelans in need, with a special focus on mothers and children. To provide these essential services, it relies on donations that people provide on the GlobalGiving platform.

Fundacion Oportunidad y Futuro addresses hunger and malnutrition with regards to children in Venezuela. It is running in an initiative to provide meals to 800 school-aged children in Venezuela. It also operates through donations via the GlobalGiving platform.

The Future of Venezuela

While there is hope to be found in these reforms, Venezuela has far from recovered. The National Survey of Living Conditions indicates that more Venezuelans are in poverty in 2020 than in 2018, with food security decreasing another 7% over the past two years. The average income of Venezuela remains low at just over 70 U.S. cents a day. These reforms are the foundational steps needed to begin to reverse the economic trend that has relegated millions of Venezuelans to extreme poverty. If the economy is ever to correct itself, liberalization and privatization will be the jumping-off point for an economically thriving Venezuela in the future.

– Kendall Carll
Photo: Flickr

Demining Zimbabwe's National ParkLocated in southeast Zimbabwe, Gonarezhou National Park is home to 11,000 African elephants, which is how it earned its name as the “Place of Elephants.” Unfortunately, it is also the site of thousands of buried landmines. These landmines were placed by the Rhodesian army during Zimbabwe’s Liberation War and have remained there for more than 40 years. Although there have been efforts to remove these mines, they continue to be a constant threat to the people of Zimbabwe and local wildlife. Demining Zimbabwe’s national park will have several benefits for the country.

APOPO: Demining Efforts

The United States has provided a grant of $750,000 to the nonprofit APOPO to demine the Sengwe Wildlife Corridor, where a large portion of the undetonated landmines reside. The Sengwe Wildlife Corridor covers a stretch of land that connects the park to South Africa and is used regularly by migrating elephants.

The area that APOPO has been designated to work is one of the largest in the world: 37 kilometers lengthwise and 75 kilometers in width. With almost 6,000 landmines per kilometer, communities in the surrounding area are unable to access potential land for farming and endangered species are at constant risk.

The presence of the minefield prevents the elephant population of the park from migrating and potentially mixing with other elephant populations. This presents a long-term risk of limiting the already shrinking African elephant gene pool.

APOPO has established a five-year plan for demining Zimbabwe’s national park, expecting to remove all undetonated landmines from the area by 2025. It estimates that it will remove more than 15,000 landmines before the end of its operation in the corridor.

The nonprofit will be working in tandem with the Gonarezhou Conservation Trust to maintain that the process will not impede conservation goals for the park.

The project also complements USAID programs to support community-based natural resource management, provide climate-smart agricultural technologies and improve the value chain for communities to sell their products for a fair market price.

Poverty in Zimbabwe and COVID-19

Zimbabwe is currently facing severe economic hardships that have only worsened due to the COVID-19 pandemic. In 2019, 50% of Zimbabweans experienced food insecurity and 40% faced extreme poverty. This number is projected to increase as conditions worsen with the onset of the pandemic and severe droughts. Inflation in the country has been rampant, with prices of food increasing by 725%, resulting in a severe loss of purchasing power for the poor. The pandemic has impacted the already economically challenged country by decreasing trade and tourism.

Aiding Economic Recovery in Zimbabwe

The United States and APOPO hope that by clearing out the Sengwe Wildlife Corridor, ecotourism in Zimbabwe will begin to thrive. As it stands currently, only 8,000 tourists on average visit Gonarezhou National Park compared to the 1.8 million tourists that visit the neighboring Kruger National Park of South Africa. Demining Zimbabwe’s national park means providing an extended opportunity for increased tourism in the struggling country. The efforts of APOPO, with the support of the United States, may be able to help economic recovery, reduce the impact of the pandemic and uplift communities that are battling poverty.

-Christopher McLean
Photo: Flickr

Aid to SenegalSenegal’s economy is one of the fastest-growing in Africa, with a growth rate of above 6% from 2014 to 2018. The country is home to 15.4 million people and is one of the most stable countries in the region. The service industry heavily burgeoned this growth, which made up about 60% of the country’s total GDP. The shock of the COVID-19 pandemic has caused a major slowdown in growth, falling to an estimated 1.3% in 2020. Although the country has instituted a comprehensive stimulus plan, Senegal’s economy is still facing a slow and painful recovery, which could be disastrous for the country’s long-term future. Aid to Senegal is essential for the country’s recovery.

Incoming Aid to Senegal

In a press release on November 11, 2020, Germany and the European Union (EU) announced the approval of relief funding for Senegal — 112 million euros in EU funding and 100 million euros in funding from Germany itself. The EU has a broader history of aid to Senegal, with more than a billion euros of aid sent from 2014 to 2020. Germany also has a history of friendship with Senegal, as the two entered into a reform partnership in 2019. The amount of aid rendered illustrates the strong commitment of both the EU and Germany to Senegal’s economy. The money will go toward Senegal’s COVID-19 stimulus program and will enable the government to continue relief efforts for its population.

German development minister, Gerd Müller, was strongly in favor of aid to Senegal and described many problems currently ailing Senegal’s economy. Nearly half of the country is unemployed and the shrinking economy will especially impact small and medium businesses, which make up 90% of all Senegalese jobs. Müller says, “We must not forget that the consequences of COVID-19 are far more dramatic in developing countries.”

Impact of Aid to Senegal

Müller is optimistic that the aid will enable the protection of jobs and the production of medical equipment necessary to fight COVID-19. The Senegalese government also started a program for businesses to receive cash loans for support.

Although Senegal’s economy is robust, it is still dependent on foreign aid to finance these measures. Aside from the aid coming from the EU and Germany, the World Bank approved $100 million worth of aid back in June 2020, demonstrating a need for further funding to prevent larger setbacks in Senegal’s economy.

An Admirable COVID-19 Reponse

The way that Senegal handled the COVID-19 pandemic itself has received praise throughout the world. It ranks second only to New Zealand on Foreign Policy’s Global COVID-19 Response Index, which measures the response of national leaders to the pandemic. The country took broad health safety measures at the beginning of the crisis, which had an unfortunate impact on Senegal’s economy. International aid to Senegal plays a large role in the country’s recovery from the impact of COVID-19.

– Bradley Cisternino
Photo: Flickr

Mental Health Care in GreeceIn Greece, the financial crisis has significantly impacted the health and well-being of the population. With limited access to resources and high unemployment rates, many people face poverty. Due to the economic crisis, 27% of the population found themselves unemployed. The inability to cope with the loss of wages and benefits caused the rates of depression and suicide to rise among Greek people. In 2013, more than 12.3% of the population suffered from depression. In 2017, the National School of Public Health surveyed 2,005 adults and found that more than half had mental health struggles. Various organizations are working to improve mental health care in Greece.

Mental Health Stigma in Greece

Conservative attitudes slowly began to change in 2014 as mental health stigma in Greece reduced from 63.1% to 36%. As the Greek economy slowly began to turn around, the connection between the financial crisis and mental health became even more evident and discussions regarding mental health care in Greece became more acceptable. Organizations fighting the mental health care crisis in Greece include the Greek Health Ministry, the HOME Project and Klimaka NGO.

The Greek Health Ministry

The Greek Health Ministry has carried out campaigns that have been influential in increasing mental health awareness in Greece. In 2019, the Greek Health Ministry coordinated a committee of mental health experts in a mental health awareness campaign. The goal of this committee was to train and equip practitioners to be able to effectively diagnose depression and mental health illnesses. The link between the rise in the economic crisis and the rise in psychiatric admissions could be clearly seen. The Council of Europe noted that “unemployed persons, bankrupt businessmen, or parents who have no means of taking care of or feeding their children” were among new admissions to psychiatric hospitals.

To assist in stabilizing admissions, the Health Ministry ran a pilot program to ensure major areas had at least one psychiatric clinic operating as a walk-in center at any given time. This program has led to the operation of three new clinics in Greek hospitals and there are plans for 16 more to open in the future.

The HOME Project

Children that are homeless or have fled from camps and detention centers can find support and housing through the HOME Project. This NGO has established efforts to support more than 2,500 unaccompanied minor children in Greece that fall outside of any official protection. The HOME Project provides legal, educational, social and mental health support to this at-risk population that ranges from toddlers to teenagers. Many of these children have been subjected to trauma and are more at risk of suffering from mental health issues. The HOME Project advocates for resources for refugee children in Europe that can create long-term child protection solutions.

Klimaka NGO

Mental health care in Greece is being improved by organizations like Klimaka, an NGO committed to caring for those impacted by mental health issues. In Greece, mental health is not a subject that people often discuss. Klimaka is one of the few suicide prevention clinics in Greece that worked collaboratively with the Greek Orthodox Church that had once been criticized for its stance on suicide. According to Klimaka, the Greek Orthodox Church viewed suicide as a sin and priests often refused burial prayers for those that had taken their own lives. Klimaka has been paramount in changing these views and reshaping the church’s role in the prevention of suicide, to the extent that the church now allows burial prayers if the deceased suffered from mental illness.

While older populations do not easily embrace mental illness, the younger generations have recognized depression as a relevant health issue during times of crisis. Mental health care in Greece continues to face challenges due to a shortage of staff, underfunding, reduced medical supplies and insufficient primary healthcare. Nevertheless, organizations are continuing to fight for improved mental health care for the most vulnerable populations.

– Brandi Hale
Photo: Flickr

cause of hungerThe COVID-19 pandemic is deemed a global health crisis that has resulted in an economic crisis and a hunger crisis too. In the Dominican Republic, Cabarete Sostenible seeks to address the root cause of hunger.

Unemployment Due to COVID-19

Cabarete, Dominican Republic, prides itself on being one of the watersports capitals of the world. Nearly two-thirds of Cabarete’s population depends on the local tourism industry for work and income. These jobs mostly fall under the informal economy.

Before the COVID-19 pandemic, more than 60% of the world’s working population were employed in the informal economy. The informal economy is defined by hourly jobs that offer neither a salary nor employee benefits. The pandemic left many people without a regular source of income and without health insurance.

Compared with the bailout packages that the governments of wealthy nations were able to provide to their citizens, the governments of impoverished nations were unable to provide citizens with such economic support. Around the world, NGOs have attempted to assist in providing the support that impoverished governments are unable to provide.

Cabarete Sostenible Addresses the Root Cause of Hunger

Moraima Capellán Pichardo, a citizen of Cabarete, is a supporter of the concept of food sovereignty. The Borgen Project spoke with Capellán Pichardo about the origins of Cabarete Sostenible and the organization’s long-term goals. Food sovereignty, the principle that individual self-actualization is dependent on having enough to eat, is at the heart of Cabarete Sostenible’s mission.

Capellán Pichardo told The Borgen Project that individual NGOs in Cabarete were working independently of each other when the COVID-19 pandemic began. These separate organizations had a common goal so they came together to form a coalition and increase their impact. This coalition became the nonprofit organization, Cabarete Sostenible. Everyone who works with Cabarete Sostenible is a volunteer. The organization works with local food distributors and organic farms and distributes the foodstuff that it receives to struggling families and individuals in Cabarete. This forms the organization’s first response to the hunger crisis.

Although it began as a method to address an acute crisis, Cabarete Sostenible seeks to address the root cause of hunger. Capellán Pichardo indicated that food sovereignty has been on the minds of Cabarete Sostenible’s volunteers and organizers since its inception. “Very early on, we sat down to discuss where we thought Cabarete Sostenible was going in the future. For us, we wanted to make sure that we did not just stick to giving out food because that does not really address the root problem.”

The Concept of Food Sovereignty

Food insecurity means being without reliable access to sufficient and nutritious supplies of food at any given time and is a common reality for citizens of Cabarete. On the other hand, food sovereignty, organizing society in such a manner that every individual has access to producing his or her own food, is a possible solution to food insecurity. “Food sovereignty is tied to land access,” Capellán Pichardo says. “For us, it is important that the first mission that Cabarete Sostenible focuses on is food sovereignty: access to healthy and appropriate food and using the native agricultural land to provide that.”

Food Sovereignty Addresses Food Insecurity

Since COVID-19, many factors have contributed to a rise in food insecurity and extreme poverty worldwide. Mass rates of unemployment have threatened access to food as even the poorest households spend close to three-fourths of their income on food.

Widespread unemployment, combined with unexpected drops in agricultural production, has created an unprecedented crisis. Because of supply line disruptions and trade barriers, often the result of increased health precautions, citizens of the world’s poorest nations are left without access to food. Some of the suffering caused by such disruptions can be mitigated by food sovereignty policies. Perhaps, a societal approach may be modeled after Cabarete Sostenible’s efforts to address the root causes of hunger.

Sustainable Community Solutions to Hunger

Capellán Pichardo is optimistic about the road ahead as she details how the organization has worked with local landowners to collaborate on solutions. The organization has opened the first community garden and is working to partner up to create a community-style farm. All this is work toward creating a social business model. Cabarete Sostenible seeks to address the root cause of hunger by helping to create a sustainable way of living, where food shortages are less likely and future hunger crises are averted.

– Taylor Pangman
Photo: Flickr

Public Development BanksIn November 2020, the world’s 450 Public Development Banks (PDBs) gathered at the first-ever global summit, the Finance in Common Summit. The summit emphasized that PDBs have an essential role in meeting the U.N. Sustainable Development Goals (SDGs) that encompasses both short-term responses and sustainable recovery measures. The commitment of PDBs to a joint effort in support of vulnerable communities around the world is an unprecedented step toward inclusive global development.

Public Development Banks

Public Development Banks are essential to the global economy and play a key role in fighting extreme poverty and hunger by bridging finance and public policy. PDBs are supported or controlled by governments but are legally and financially independent. Investments by PDBs made up 10% of yearly public and private investments in 2018, though all PDB investments are public, allowing the banks to openly and actively direct finances toward the evolution of international economic order and inclusion of declining countries with fewer limitations. This makes PDBs especially effective at supporting change for institutions, economies and infrastructure that reflects their public mandate to work in favor of entrepreneurs and vulnerable groups, such as women and children. None of the financing done by PDBs is related to consumers, individual accounts or credit.

A Cause for Cooperation

Conditions in areas suffering from extreme poverty are declining due to climate change and COVID-19. Developing countries have limited capacity to adapt their unstable agricultural methods and systems to changing climates. The capacity that does exist, including aid received, has been strained by the COVID-19 pandemic and the economic and social issues that accompany it. Common hardships have shed light on the need for united relief efforts that reach all regions and societies, and Public Development Banks have taken action by joining in unprecedented discussion and collective decisionmaking. The desired outcome was a diverse and collaborative movement to achieve the SDGs and respond to the challenges arising from COVID-19 and climate change.

The Future of PDB Financing

The developments made at the Finance in Common summit are clearly communicated in a joint declaration made by all 450 PDBs. The Public Development Banks came to a consensus for aligned strategies and investments that will support sustainable growth in societies and the global economy, all while prioritizing eco-friendliness. Future activity of PDBs will be targeted at attaining the SDGs and responding to a changing climate. Another outcome of the summit was a group of PDBs that will focus investments on rural sectors and agriculture around the world to help eradicate poverty and hunger.

Steps that PDBs have committed to taking together include transitioning investments to support low-carbon and climate-resilient solutions, renewable and clean energy and ecosystem restoration. Also on the global PDB agenda is improving the accessibility of education, housing, hygiene and sanitation as well as advancing social and financial inclusion. These measures were developed with the world’s most vulnerable in mind: young people and the elderly, members of rural communities, refugees and small-scale producers, among others. The alliance of PDBs is dedicated to achieving these goals while upholding best practices in finance and global inclusion.

PDBs Fighting Global Poverty

Public Development Banks have displayed a capacity to serve as leaders in the fight against extreme poverty and hunger. Their landmark summit can be a model for future progress toward equality in all parts of the world. In the middle of widespread crisis and instability, such international cooperation is needed more than ever.

– Payton Unger
Photo: Flickr

Greek startups are helpingEntrepreneurs in Greece are finding ways to battle the financial crisis that has crippled its economy. While entrepreneurship in Greece has predictably prospered in the tourism sector, many new startups are finding success in technology, science and engineering. In 2018, Greece was named the European Capital of Innovation by the European Union and ranked 11 in the world by the Global Innovation Index for science and engineering graduates. Via innovative ideas, Greek startups are helping the economy by creating jobs and stimulating economic development.

Augmenta

Founded in 2016, Augmenta has been helping farmers decrease their costs while increasing production. The video device uses machine learning to analyze tractor movements, increasing yields by 15%, reducing chemical field inputs by 20% and improving field end production by 15%. Another advantage of this innovative technology is that the more the farmer uses the device, the more data will become available to the other farmers. Augmenta’s benefits are promising for farmers and the agricultural industry as a whole.

Neos Beyond Payments

With the increasing demand for contactless payment due to COVID-19, Greek startup Neos Beyond Payments is finding its place in the economic market. The wearable device has now taken off in the European market and continues to expand into Scandanavian markets as well. In partnership with a Swedish technology firm, Fidesmo, Neos makes it possible for you to tap and pay on any contactless terminal, the same way you do with your payment card, by using the Neos wearable bracelet. With more demands for contactless payment options, the Neos wearable device will be useful in all markets.

Inagros

Inagros is another one of the Greek startups helping the economy by creating innovative technologies for farmers and agronomists. Inagros’ innovative web platform delivers data through satellites and sensors to enhance crop production and reduce the consumption of water, fertilizer and energy. This new technology is expected to be a pillar in the development of the smart farming revolution, with innovations expected to significantly impact automatization and sustainable management in particular.

Rebuilding the Greek Economy

The bailout in 2010 was just the beginning of the collapse of Greece’s’ financial economy. By 2015, the country had borrowed more than €289 billion, the largest bailout a country has ever received. As a result of which, entrepreneurs, scientists and professionals fled due to the dying economy. Entrepreneurs in Greece that persisted during these years created momentum and paved a path for future entrepreneurs to continue to contribute to rebuilding the fallen economy. While Greece continues to fight through financial barriers, a booming economy may be on the horizon, with Greek startups helping the economy by creating innovative market opportunities that steadily bring life back into a fragile economy.

– Brandi Hale
Photo: Flickr