Tourism-Economies
Everyone loves a good vacation or at least it is easy to think that while walking on a white-sand beach and sipping a Mai Tai. The truth lurking behind the tranquility of remote island temples and the prestige of historical landmarks is that tourist economies are not all sunshine and smooth sailing. With off-seasons that take up a large portion of the year and uncertain demand, tourism-economies may be more vulnerable to pitfalls than industrial or agriculture-based economies. The following countries exemplify the great promise and instability of tourism-economies.

Indonesia

Tourism in Indonesia is one of the main draws for foreign currency. In 2018, the number of people coming in from outside of Indonesia rose 12.6% to about 15.8 million. One of the biggest draws in tourism is culture. Countries that do well in tourism carry significant cultural influence in the area or have notable landmarks. For example, the world fetes Italy for its long history, art and cuisine. Meanwhile, statistics have shown that Indonesia underperforms in this sector compared to other countries in the region. Singapore, for example, draws in about 19 million people per year.

Bangladesh

Bangladesh is rapidly developing and this is an overall plus for the economy. However, it could bring a slight hiccup in the years to come. The nation’s main source of income, its textile industry, faces an imminent, irreversible decline with its graduation in development stages. Tourism could be Bangladesh’s biggest hope, with the industry contributing 10.4% to the global GDP. However, tourism only comprised 4.4% of Bangladesh’s GDP as of 2018, painting a bleak picture for the future of tourism. The country has been performing second to least successfully concerning popular destinations in Asia.

What might help is how well South Asia has been performing in tourism. Nations that have performed well in this area, like India, Malaysia, Indonesia, Thailand, Singapore and Vietnam, drew in 86% of the region’s total earnings in 2018 – a high Bangladesh was able to ride on the coattails of, as it attempted to market itself as a more desirable tourist destination. In recent years, Southeast and Southern Asia have demonstrated success in tourism, with respective 8% and 10% rates of growth.

One factor that greatly affects tourism is the visa facilities in a country. If tourists find the entry process to be too much of a hassle, they may be less inclined to vacation there. In India, a top-performing country in tourism, most of the world can easily obtain an e-Visa. In Bangladesh, however, in order for a person to gain a visa, many of their neighbors need to secure a visa beforehand. This further hampers an already struggling tourism industry.

Nigeria

Some have long thought of Nigeria as having great tourism potential, although obstacles in economic development stand in the way of meeting this full potential. Countries also have accommodation rates to take into account with tourism economies. Too steep a price may turn travelers off while not charging enough will undercut the profit potential of having a tourism economy to begin with. Since not all currencies convert equally, tourism-economies do well when they draw tourists from places with currencies that are more valuable to them. For example, Nigeria has this advantage over the U.S., with $1 being equal to 381.25 Nigerian Nairas. The average hotel rate in the U.S. was $131.21 per night as of 2019, while in Nigeria, the daily rate averaged anywhere in-between the equivalent of $27 and $128.

Relative Problems

Where tourism differs from other income-generating industries is that demand is less certain. If there is a use for a product, then a demand exists, and if there is a demand, then a country can profit by supplying for that demand. However, with tourism-economies, the “use” that creates demand is fickle, and as such, the success of the country “filling the supply” is less secure.

When the culture cannot compete, visas are too difficult to secure and prices just are not right, it does not just mean that the economy slows. People working in tourism potentially cannot generate an income, even if they can technically perform their jobs correctly. Travel trends and off seasons are out of the control of the low-to-middle income people working in the industry. For those already in a precarious financial situation, finding financial growth and stability in a tourism economy is incredibly difficult. In the past year, the global COVID-19 pandemic has also created further problems for the tourism industry.

Barefoot College International

With COVID-19, travel restrictions and business shutdowns, the tourism industry is all but entirely gone in most countries. As the earning potential of a tourism economy is insecure, some organizations strive to help populations attain more secure means of income. Barefoot College operates in more than 90 countries and is expanding across Africa, Latin America and South Asia.

Barefoot College has a variety of boots-on-the-ground efforts to help impoverished communities, including clean water and environmentally conscious health initiatives. It also has a strong education program that provides academic and practical skills that can help people increase their earning potential and make it easier for them to get jobs. Its focus is on digital education so that its work is accessible for people anywhere in the world.

After 40 years, 75,000 children have received an education, 65% of whom have been girls. From here, 40% of the children educated through Barefoot College have been able to enter their country’s mainstream education system. Of those educated through Barefoot College, 30% went on to become employed at jobs that required literacy. After graduating, 85% of those considering migrating decided to stay in their village to use their acquired knowledge and skills there.

While tourism-economies can be very profitable, changing factors such as a global pandemic cause many of these economies to be unstable. Organizations like Barefoot College help provide much-needed stability to tourism-economies. Moving forward, it is essential that more organizations work to find long-term economic solutions for countries that rely heavily on the tourism industry to help ensure a stable economic future.

Catherine Lin
Photo: Flickr

Child poverty in Greece
Child poverty in Greece is a prominent issue. About 40% of children under the age of 17 are at risk. According to Eurostat, Greece ranks at the top of the child poverty scale. Furthermore, Greece’s poverty rate is the third-highest within the European Union. This article will explore the state of child poverty in Greece and efforts to address it.

Education

The economic crisis in Greece is one of many reasons for the rising child poverty rate. Access to education has decreased as well. As a result, many children are unable to attend school and unemployment rates have skyrocketed.

State education is free until university in Greece and education is compulsory between the ages of 6 and 15. In spite of this, approximately 11.4% of students dropped out of school in 2010. Moreover, an average of 30,000 students never enter high school. The highest high school dropout rate is in the Dodecanese islands and Rhodope.

Child Abuse

Giorgio Nikolaidis is a child psychiatrist and head of the Mental Health Department of the Institute of Child Health. He stated that inadequate child protection services were further undercut long before the economic crisis. Authorities are often aware of domestic, sexual abuse against children; however, they do not take the correct measures to protect children.

“I have seen cases where four-year-old kids were treated for sexually transmitted rectal HPV for over a year and no investigation had been undertaken to determine how they got it,” Nikolaidis said. The reality is that there is no coherent system to effectively protect victims.

The Greek constitution prohibits forced labor, but the minimum age for work is as low as 12 for people working in a family business. Thus, families often send their children to the streets to beg for money. Although Greece ratified the Worst Forms of Child Labor Convention, these activities remain unpunishable by law. Children who spend more time on the streets are also at an increased risk of child trafficking.

Together for Children

Together for Children is an NGO that provides assistance to young people and their families. The organization is comprised of nine member organizations that work in child welfare. Its mission is to provide immediate support for children, families and individuals with disabilities.

The organization established a child helpline that provides free counseling services and emotional support for children and their families. Together for Children strives to tackle child poverty in Greece and create sustainable living conditions. Additionally, the organization ensures access to free education through various programs such as a nursery school for children with cerebral palsy, a development playgroup for children with cerebral palsy and other disabilities, a special primary school for children with cerebral palsy and productive workshops for adults with cerebral palsy. Together for Children also has activities and programs to support unaccompanied minors who are refugees.

Assisting more than 30,000 children every year, Together for Children has received the Silver Medal of the Academy of Athens for its social contribution. In 2019, it also received a BRAVO Award for engaging with thousands of citizens in support of its initiative: Equal Opportunities for Children: Actions for Health and Education in Remote Areas of Greece.

Looking Forward

Organizations like Together for Children help create a better society for children to flourish. It focuses on improving the health and well-being of impoverished children, creating opportunities for quality education and supporting refugees. This organization has taken great strides in alleviating child poverty in Greece.

Poverty in Greece remains high due to the lack of education, child abuse and labor exploitation. Sexual and labor exploitation impoverishes children mentally and physically. Although the Greek financial crisis is often blamed for inadequate social services, there is much more that the country should be doing to protect children. Moving foward, it is essential that the government and other humanitarian organizations prioritize addressing child poverty in Greece.

– Marielle Marlys
Photo: Flickr

Informal Employment
Informal economies are a global phenomenon that often goes unmentioned by popular media. From street vendors to unregistered employees in sweatshops, informal workers make up a large portion of a country’s labor. Informal employment refers to workers who engage in labor that is not taxed or registered by the government. Informal economies are popular because of the opportunity to access wealth. While many see informality as a chance for upward mobility, there are many downfalls to this sector which are clearly visible in the case of Argentina.

Argentina has one of the largest economies in Latin America as it has vast natural resources in energy and agriculture. As of 2020, their GDP stood at 450 billion U.S. dollars and the country had significant advantages in the fields of manufacturing and tech industries. While Argentina’s numbers stand strong compared to other countries in the Americas, a closer look into their labor shows a different picture of their economy. In 2018, informal employment was 48.1% of total employment in Argentina. While many in Argentina find that informal employment is the only option for financial survival, this sector brings about serious issues for both individual workers and the larger economy.

Poverty and Informal Employment

The push factors to join the informal economy of Argentina differ based on one’s purpose in this sector. For employers, cheap wages are a major reason to seek unregistered workers. Informality markets itself as a money-saving business model. For workers, informality does not present itself as an option but as a means for financial survival. Argentina’s market does not offer many jobs in the formal economy, leading employees to grab at whatever positions are available.

The link between informality and poverty is hard to explore. Questions remain over whether informality causes higher levels of poverty or if poverty leads to higher levels of informal employment. The World Bank team in Argentina has developed a two-year program to analyze the causes and consequences of informality in Argentina. In their study, it was found that informal work appears to be the most common type of employment among workers in poor households, but the degree and direction of causation are more difficult to determine. Whether poverty causes informality or informality causes poverty is uncertain. The program is finding that prior to Argentina’s economic crisis, the increase in poverty rates appeared to be driven by an increase in poverty among informal households. Such statistics confirm at least a correlative link between the two issues. This serves as evidence for why issues with informality should be at the forefront of anti-poverty efforts.

Dangers of Informal Employment

Informal economies pose several consequences for the welfare of workers and the larger market economy of a country. On the side of workers, informal employment is an opportunity that comes with many risks. The biggest obstacle with informal economies is the recognition of worker’s rights. Given that these workers are not registered, organizations do not have the responsibility to uphold necessary protections. In Argentina, the Confederation of Popular Economy Workers estimates that only approximately 20,000 workers, or about 0.3%, have acquired labor rights so far.  This 0.3% comes from a total of 7.2 million informal workers, thus showing that many of these persons lack access to health insurance, pension, and protection against labor accidents. Consequently, informal workers often find themselves at the margins of society as their work fails to secure a stable income.

Informality also poses a threat to the overall economy of a country. In a personal interview with Dr. Jeronimo Montero Bressan, a full-time researcher for the National Scientific and Technical Research Council in Argentina, he explained the ways in which the informal sector affects the rest of the country. Informal employment is a subsidy to the private sector. Most informal employment falls in the hands of private companies that produce subcontracting chains. This way informal workers can work under formal companies.

For Dr. Montero Bressan, while many come to have a romantic view of informality, the reality presents a chain of exploitation and an overall risk for the livelihood of the rest of the country. Dr. Montero Bressan has attested that because informal workers receive little money, wages will likely diminish throughout the entire economy, thus serving to motivate this type of employment. He has also said, “So, you tell people you won’t hire them because you could get the same labor for half what you pay them.” Informal economies do not just have an effect within a certain sector but come to influence the economy of the entire country. Without stronger regulation, everyone will stand at a loss as the value of labor falls with companies being able to ignore worker’s rights.

What is the response?

As Argentina sees stable numbers in the informal economies, efforts to reform this sector continue to fall short. According to Dr. Montero Bressan, the government of Argentina has done little to improve the rights of informal workers. In recent years, fines for specific sectors were blanketed, preventing companies from being fined when they leave workers unregistered. From his perspective, Argentina has weak labor laws that can provide little security. Dr. Montero Bressan has stated that if one were to be fired from an informal job, the employer could be taken to trial, however, the only likely result would be compensation. Such compensation gives laborers some value for their work, however, one-time compensation will not fix the problem of informality. Employees will find themselves back in poverty and seeking informal employment once the compensation runs out.

Informal employment generates consequences from the very beginning as worker’s rights are denied. For Argentina, the informal sector poses an extensive problem for both informal workers and the larger economy as informality decreases wages in the country. The informal sector has a strong connection with poverty as this means of labor is generally common in poor households. This sector, however, is not sustainable and the government of Argentina must respond by providing protection for workers and holding companies accountable for failing to register their employees.

– Ana Paola Asturias

Photo: Flickr

Poverty in Paraguay
The landlocked country of Paraguay, located in south-central South America, currently faces authoritarian rule and turbulence. These recent troubles have contributed to the long history of poverty in Paraguay. Since the 1860s, the country has participated in three different major wars in South America. It also experienced a civil war in the 1940s which given the Paraguayan people a strong sense of fear and unwillingness to express themselves freely. This sentiment has only recently begun to diminish in the early 21st century.

Background

The citizens and inhabitants of Paraguay are less diverse and more ethnically homogenous than in other South American countries. Most are of European and Guarani descent. Rivers are very important to the country’s economy, as they support the function of many hydroelectric power plants. Paraguay is one of the best producers of soybeans, and many parts of the country are flourishing, where fertile soil allows for diverse diets and high standards of living.

While the country has been making a lot of progress in the 21st century in its efforts to combat poverty, economic distress continues to be a major issue. Leading up to the year 2017, there was actually an increase in poverty rates. Even though the country performed better economically overall, the total poverty rate that year rose from 26.6% to 28.8%. Even extreme poverty, which is defined as living on less than $1.90 a day, increased in this period.

Those numbers are heartbreaking because it shows a reversal in the steady decline of poverty rates in Paraguay in the years prior to 2016. To put this into perspective, in the five years previous, the poverty rate declined from 31.37% to 26.58%. This sudden worsening was unexpected as the South American region was collectively making progress in the fight against poverty. However, things have changed since then, and poverty in Paraguay is showing signs of improvement.

Path to Progress

Some think that changes in poverty in Paraguay are the result of the government shifting its focus to extreme poverty. People in extreme poverty may not have the most basic necessities, such as food, shelter, sanitation, and medical services. Jose Molinas, the Minister of Technical Planning, has admitted that there is a goal of reducing the extreme poverty rate to three percent. However, there is no goal to address the total poverty rate, leaving some impoverished people neglected.

Alicia Bárcena, the Executive Secretary of the U.N. Economic Commission for Latin America and the Caribbean (ECLAC), stated that a lack of investment, extensive divisions in class structure, and limited productivity gains are threatening the region’s ability to reach the poverty reduction goals agreed upon by U.N. members in 2015. Perhaps by addressing these issues, then, and by giving attention and care to the total poverty rate as opposed to only extreme poverty rates, the country can see a decline in poverty rates.

In fact, progress is already being made, with the poverty rate going down from 24.2 to 23.5 between 2018 and 2019. This is due in part to the ongoing support from other countries and aid organizations.

The Australian embassy in 2019 initiated the Direct Aid Program (DAP). DAP provides small grants for over 80 countries worldwide, including Paraguay, funding non-governmental organization initiatives to aid these countries. It supports things like providing education for the youth, including vocational and sex education. Other initiatives include promoting the economic development of women to achieve gender equity, as well as infrastructure projects for indigenous peoples. One such initiative, Poverty Spotlight, helped 30,000 Paraguayan families leave poverty through higher income generation. Continued support of programs and initiatives like these will help maintain the country’s progress and gradually eradicate poverty in Paraguay.

Fahad Saad

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

Foreign Aid to Sudan A fractured economy, political protests and the transition to a democratic country are factors that have put Sudan in the global spotlight. Due to shortages within the country and the added weight of COVID-19, Sudan is on track to receive much-needed financial aid from several global sources. Foreign aid to Sudan will provide direct relief to the impoverished people in the country.

Improved Foreign Relations

In February 2020, Sudan’s ex-president, Omar al-Bashir was prosecuted and convicted for the mass murders of people in the region of Darfur. The declaration was made that the country would cooperate with the ICC (International Criminal Court) for the prosecution. This act could serve as a window of opportunity for improved foreign relations and a new international image. There have also been talks of peace agreements between Sudan and Israel. These issues have attracted a global audience as the world watches to see where things could potentially lead to.

Democracy and Debt

One of the country’s most monumental feats was transitioning to democracy after many years of social discord and oppressive power. Unfortunately, this massive change also came with a damaged political system and an outstanding debt of nearly $60 billion. Necessities such as food and fuel have undergone an extreme rise in price at an 80% estimate and the introduction of COVID-19 could be the potential last straw for Sudan’s already overburdened economy. While Sudan’s army chief of staff, Lt. Gen. Abdal Fatteh al-Burhan, is a member of the Sovereign Council, the relationship between the country’s government and the military is rocky. The prime minister, Abdalla Hamdock, is desperately trying to avoid a potential military takeover and is calling for any available financial support from allies abroad.

Sudan’s Call for Help

Sudan’s call for help had reached many different listening ears. In a joint effort, the World Bank, the European Union and several other countries signed a deal of almost $190 million that would go directly to families in need through the Sudan Family Support Programme (SFSP). The amount of foreign aid to Sudan would equal out to 500 Sudanese pounds (roughly $9) per person, per month for one year and aims to cover the needs of nearly 80% of Sudan citizens. Prime minister Hamdock noted that while willing donors have given $1.8 billion to help, the country is really in need of $8 billion for a real balance to its economy. The distribution of the aid was set to begin in October 2020 and will eventually total $1.9 billion after two years.

The Road Ahead

With the degree of social and political change in Sudan, the country is certainly moving in a positive direction. Reinventing the country’s image and political structure is no easy feat. Sudan has proven that change is certainly possible, even in the most dire circumstances, especially with sufficient international backing and support. Foreign aid to Sudan gives the people of the country hope for a better future.

– Brandon Baham
Photo: Flickr

Elderly Poverty in El Salvador
El Salvador is one of the most densely populated countries in Central America. Salvadoran elders represent almost 12% of the population, according to their Ministry of Health. Of 1.2 million elders, only 200,000 receive a pension. The latter prompts a situation where abandoned elders enter poverty. Moreover, the World Bank estimates that the COVID-19 pandemic will negatively affect the country’s economic growth, decreasing GDP by 8.9%. Together with existing factors, there is soon likely to be extreme elderly poverty in El Salvador.

El Salvador’s Pensionary System

El Salvador’s pensionary system consists of a privately defined contribution scheme, constructed by the employer and the employee’s contributions, according to the OCDE. However, it does not guarantee a stable future for elders. Often, their life earnings are insufficient to fulfill their basic needs throughout their lives. 

Abandoned Elders

Juan Lainez, 83, is the owner of an ambulant shop at the sidewalk of Rosales Hospital, in San Salvador. For 21 years, he has woken up at 7 a.m. to sell purses and accessories to pedestrians. He used to work at a dairy company, but after retirement, he has no access to Social Security or to the pensionary system. Many third-age Salvadorians face his situation. Individuals facing elderly poverty in El Salvador beg for money on the streets, while others live in public homes for abandoned elders.

Organizations Fighting Elderly Poverty in El Salvador

Stories such as Lainez’s have triggered Salvadorians into action. Our Lady of Peace Home for Abandoned Elders receives visitors who donate food and cleaning materials. Some initiatives come from Salvadoran enterprises and others come from particulars. Our Lady of Peace houses 40 elders and it does not receive fixed donations. Some elders pay a symbolic amount, while the organization rescued others from the streets. 

The nonprofit organization Touching Hearts works has the motto that “if you cannot feed 100 people, then feed [one].” The Borgen Project spoke to Cristina Hauener, a member of the organization. Hauener explained that the project began as a family initiative and then expanded to close friends, volunteers and donors. “Three years ago, I visited the Bloom public hospital and overheard a conversation. It was a mother asking her neighbor to buy 25 cents worth of tortillas to feed her children, who were home alone without a meal. As a mother, those words shook me. I have never lacked a meal and it was so hard to see how several Salvadorians had nothing to eat,” Hauener confessed. Touching Hearts aims to provide food for people in extreme poverty.

In the beginning, the organization gave donations to the Bloom hospital and to a home for kids with cerebral palsy. As donations grew, the project focused on feeding abandoned elders. The organization members gathered every Monday to prepare the meals: “As in the human body, each member fulfills his function. Some cook the meals, some pack and others distribute and visit the elders,” she listed.

Elderly poverty in El Salvador is a growing social issue. However, small-scale initiatives are making progress with whatever is in their reach.

Paola Arriaza Avilés
Photo: Flickr

Poverty Reduction in Iraq
The Middle East has been one of the world’s hardest-hit regions to date when it comes to COVID-19. Unfortunately, Iraq has bared the brunt of the damage resulting from economic recession and humanitarian woes. Since the summer of 2019, four and a half million Iraqis have fallen into extreme poverty, increasing the total poverty rate to over 11 million. The majority of those falling into poverty are children, with reports claiming two out of every five children in Iraq live in desolate conditions. Nevertheless, despite new challenges, the international community and regional actors are preparing to jump-start new innovations to reduce poverty in Iraq.

Previous Progress

Over the past ten years, Iraq has undergone a series of changes. In 2015, the Committee on World Food Security (CFS) outlined a series of initiatives designed to reduce Iraq’s poverty and hunger. From creating job opportunities to building a more robust social safety net, the CFS set the groundwork for crucial innovations to reduce poverty in Iraq.

Additionally, in 2018, Iraq worked with regional and international partners such as the World Bank to introduce a $300 million social fund designed to reduce poverty and inspire sustainable development.

While previous efforts are laudable, in the wake of COVID-19 and the recent economic recession, global and local actors need to do more to reduce Iraqi poverty. This is especially true when considering how, in 2020 alone, Iraqi poverty was expected to double to 40% of the population.

Poverty Reduction Innovations for Refugees

In an effort to reduce poverty in Iraq, many international and regional actors have banded together to create innovative approaches. For instance, the UN Agency on Refugees (UNHRC) recently launched the WASH program. The WASH program sets up water sanitation systems in vulnerable refugee camps, Iraq hosting many of them. According to the UNHRC, “The system uses a series of networked, ultra-sonic water-level sensors that are installed in the tanks of water delivery trucks as well as static water tanks in refugee settlements to provide real-time data on water deliveries and consumption. It is based on the “Internet of Things”. Physical objects are fitted with sensors in order to connect and exchange data over the Internet.

The system maximizes inter-regional coordination and saves Iraq money, all while minimizing the effect of Iraqi poverty. Although widespread across other countries, WAHS chose Iraq as one of the ‘pilot phase’ countries. They are thus allowing Iraq to harness the findings and help one of it’s largest sources of poverty, refugees.

While crumbling infrastructure and lack of access to food are primary causes of poverty, the inability to care for Iraqi refugees has hindered any development progress. In essence, in order to reduce poverty in Iraq, one must also consider poverty amongst Iraqi refugees.

Innovating Through Technology

Another innovation in poverty reduction is a medical app design to connect Iraqis to affordable medications. The military conflict in Iraq has destroyed numerous hospitals, so medical care in the country is exceedingly scarce. This lead Ameen Hadeed and developer Ammar Alwazzan to create the Pharx Pharmacy app. The app connects patients to over 200 Iraqi pharmacies. This eliminates the private medical middle man that makes drugs so expensive. Moreover, the Iraq Response Innovation Lab recently decided to sponsor the future development of the Pharx app. This will allow it to expand all across the country, far beyond urbanized areas such as Mosul.

As technological innovations become more frequent in Iraq, the fight against poverty is a primary focus for tech innovators. Take, for example, Miswag, the Middle East’s oldest online market platform. Miswag has recently taken a new direction in Iraq. They made it more affordable to buy food, groceries, clothing, books, and many other daily necessities. While initially Miswag was not explicitly designed for poverty alleviation, its growing market of 700,000 customers makes goods more affordable while allowing locals to sell their products more efficiently, which helps innovate the fight against poverty.

Looking Forward

Building more robust markets that encourage investment and innovation is crucial to continue poverty reduction in Iraq. It will also ensure sustainable growth for the long-term. Poverty is not a simple problem, and Iraq has weathered many conflicts in the past couple of years. However, if we all work together, we can make a difference.

Juliette Reyes
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

Elderly Poverty in Fiji
The small island of Fiji has seen a significant jump in life expectancy in the last 50 years. Where once the highest age people expected was 55 years old, Fiji’s population is slowly growing older with residents living to the age of 70 and on. While medical advancements and improved sanitary conditions have extended the residents’ lives, the government has left little economic room for the island’s elderly citizens. As a result, elderly poverty in Fiji is prevalent.

The Situation

All formal Fijian workers have a mandated retirement age of 55 years old leaving many without sufficient income for the decades to follow. As a result of this outdated system, more and more of Fiji’s older residents are sinking into poverty in their final years.

While the retirement age affects all citizens, ethnicity and marital status are two of the most influential factors in elderly poverty in Fiji. Indo-Fijians, residents of Indian descent, are more likely to have received a secondary education, owned their own business and maintained a more stable income. Meanwhile, ethnic Fijians, residents of Fijian descent, are more likely to fall into poverty because they were often informal workers and only received primary education.

The Fijian National Provident Fund (FNPF)

The Fijian National Provident Fund (FNPF) is a government-funded pension for the workers of Fiji. Both employees and employers contribute 8% of employee wages to this fund. Unfortunately, the fund does not pay out large enough sums to the growing elderly population that is living longer and longer each year and as a result, it is having little effect on elderly poverty in Fiji. While other government schemes are attempting to assist such as a Government Social Pension Scheme (SPS), The Family Assistance Program (FAP) and The Poverty Benefit Scheme(PBS), they still come up short.

In addition to the inadequacy of pension payments, 72% of Fijians do not qualify to receive a pension because they were part of the informal work sector. Informal work is typically jobs that are less stable and consistent and often have lower wages. Informal workers have a difficult time preparing for retirement because of the nature of this work and suffer the most when forced into retirement.

Marital Status

Most elderly Fijians who are married continue to live with their spouse and children. This tradition of the elderly leaning on their children and family for financial support has come to be expected, but not guaranteed.

Single citizens and those who have separated, divorced or become widowed are more likely to reside alone and have to rely solely on their pension or welfare payments. Additionally, they are often unable to afford to live independently forcing them to co-reside with others.

Women

Women are most vulnerable to falling into elderly poverty in Fiji. Halima Bibi, a 72-year-old Fijian woman that has been living alone and without electricity for 20 years, scrapes by on a combined $170 a month that she receives from welfare and a religious organization. Although women are responsible for 52% of all work on the island, they disproportionately receive 27% of the total income that Fijians collect. Women experience exclusion from the economy and tend to outlive men by several years, often leaving them without the financial support of their spouse. As a result, many Fijian women such as Bibi go without basic comforts and struggle just to survive.

A recent change in values and priorities has diminished the family safety net that many Fijians, and especially women, rely on. Many elderly Fijians live just like Bibi and struggle to survive retirement relying on measly welfare checks and the charity of their community or family.

The Fijian Government’s Efforts

The Fijian government is continuously amending policy restrictions and improving income security to combat elderly poverty in Fiji but as the country’s life expectancy continues to increase, it is struggling to keep up. If the government can monitor the population and maintain accurate statistics on elderly poverty, it will be able to amend these policies to help a greater number of impoverished elderly.

If the Fijian government can modify these pension schemes to account for the extra hardships women endure as well as the neglected workers of the informal sector, elderly poverty in Fiji could reduce. An affordable health care system and financial educational programs would greatly benefit the elderly as well, resulting in them keeping more money in their pension and being more prepared for retirement.

Organizations Providing Aid

While the government attempts to widen the safety net for Fiji’s elderly population, organizations including Habitat for Humanity or the Peace Corps are trying to reduce the financial burdens of the older population. The Fiji Council of Social Services (FCOSS) is an agency that receives donations from the state that other countries have given as aid. The FCOSS allocates the funds where necessary with an emphasis on the elderly. It also provides the HelpAge program that targets struggling elderly and directs assistance towards them to alleviate hardships.

Most importantly, the government must increase the retirement age to allow the elderly to continue to earn income and also guarantee an effective pension for the future. Even with new schemes directed at the chronically impoverished and volunteer organizations’ efforts, it is essential that Fiji changes the retirement age and allocates proper funds to the older population to ensure they can enjoy their golden years.

– Veronica Booth
Photo: Flickr