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Covid-19 Crisis
The COVID-19 crisis or coronavirus pandemic continues to grow as the number of global cases rises. With U.S. President Donald Trump approving a fiscal stimulus package of $2.2 trillion, the dire economic ramifications of the COVID-19 crisis grow more significant. Yet, there are disproportionate economic impacts on the world’s poor that highlight the implications of COVID-19 on global poverty.

What the COVID-19 Crisis Means for Global Poverty

Unfortunately, the aftershocks of COVID-19 will destabilize the world economy even further during the beginning of 2020 and beyond. The Asian Development Bank already estimates that the collective global impact of the COVID-19 crisis will be between $77 billion to nearly $347 billion in economic output costs worldwide.

The World Economic Forum calls the COVID-19 crisis a “pandemic in the age of inequality” as it especially impacts countries lacking universal health care or adequate health care systems. Many workers have lost work and are cannot even take paid sick leave of any kind.

“[I] fear hunger will kill us before coronavirus,’’ says Momanned Sabir, a young street entrepreneur in Delhi who owns a yogurt-based drink shop. Her words come in response to the three-week lockdown that Indian Prime Minister Narendra Modi imposed. Poverty and unemployment impact many daily wage earners and workers in informal and unorganized sectors. This is particularly evident in nationwide lockdowns from India, China, the Philippines, the Middle East and European countries.

Among the 50 countries under the United Nations’ Least-Developed Country Status (LDC), more than 900 million remain vulnerable to the risk of COVID-19. This is due to the poor health care infrastructure and resources to support a large-scale health crisis. Most importantly, many countries continue to be in short supply of testing kits.

U.N. Secretary-General Antonio Guterres has appealed for $2 billion to help the world’s poor who have been impacted by COVID-19. World Health Organization director Tedros Adhanom Ghebreyesus implores G20 nations to offer aid and support low and middle-income countries.

Future Course of Action

Indian Finance Minister Nirmala Sitharamn has proposed an economic stimulus package for financial relief to women and vulnerable groups. For example, there are welfare systems that distribute free gas cylinders, wheat and rice for up to three months. For women in India’s Jan Dhan banking system, the government offers compensation of 500 rupees for the next three months. In addition, India has issued a bailout package of $22 billion to help cushion the economic impacts of its lockdown, especially as several daily wage and unorganized workers have lost out on work and pay during this period.

The number of testing kits will also increase soon due to the invention of a new working test kit by Dr. Minal Dhakave Bhosale. India will thus rely less on more expensive imported kits. There will be a distribution of more than 100,000 kits every week from now on.

Moreover, the International Monetary Fund (IMF) has provided $50 billion to control the COVID-19 crisis in low-income countries that seek support through its emergency financing facilities. Along with the IMF, the World Bank is also providing debt relief to poor countries through loans and grants. The group is also working with more than 35 countries to address the economic implications of the pandemic. The World Bank also plans to spend a whopping $160 billion over the next 15 months and is already securing fixed amounts for wide-scale mitigation efforts and projects.

Oxfam International is working on ways to use its knowledge and expertise in public health to better address the ongoing crisis, especially after its work during other outbreaks like Ebola and the Zika virus. Oxfam is also assisting in the delivery of sanitation services and offering accurate information to people.

Looking to the Future

To help those who have lost jobs due to COVID-19, the Asian Development Bank recommends focusing on strengthening social assistance. It also urges attention to upgrading labor market policies and programs.

The COVID-19 crisis could also impact the way the world addresses global poverty going forward, especially given the potential global impacts. It will take long-term development strategies to get low-income workers and poorer communities back on their feet.

Shivani Ekkanath
Photo: Flickr

Corruption in Ukraine
Massive corruption in the Ukrainian government has left Ukraine and its people in a state of developmental stagnation for decades. Despite this, in recent years, Ukraine has demonstrated its willingness to reform and change for the better through countless efforts to expose and clean up these corruptions. These 10 facts outline the specifics of corruption in Ukraine.

10 Facts About Corruption in Ukraine

  1. Corruption: According to Transparency International (TI), as of 2018, Ukraine ranked 120 out of 182 countries in TI’s Corruptions Perception Index, making it the second most corrupt country in all of Europe. A survey from Freedom House also indicated that the level of corruption in Ukraine had only slightly alleviated since the fall of the particularly corrupt Yanukovych presidency in 2014.
  2. Tax Reforms: Tax reform continues to be a major barrier in the fight against corruption in Ukraine. Outrageous tax schemes and gross misuse of funds led to a 35 percent VAT compliance gap in the 2012-2013 fiscal year, compared to the 6 percent gap recorded in 2011. In 2014, new authority investigations found that $37 billion of the country’s overall budget disappeared due to fraudulent tax schemes. Experts speculate that during Yanukovych’s presidency, a total of $9 billion went unaccounted for and at least $2 billion of that went into the pockets of Yanukovych’s family coffers.
  3. Banking: Another major contribution to the corruption in Ukraine lies within its banking sector. The severity of corruption within Ukrainian banks became especially apparent during the 2014 banking crisis. Most banks involved themselves in the money-laundering Ponzi schemes. The banking systems were so corrupt that out of 182 of the nation’s banks, 98 of them have been or are in the process of being completely liquidated. Strict anti-money-laundering laws and tighter control over cash-flow have helped alleviate some of this corruption. In addition, banks that survived the crisis are now liable for any losses their clients suffer due to fraudulent banking practices.
  4. Government Accountability: Quintagroup aimed to reach a higher level of government accountability by creating a transparent electronic procurement system for officials to use. The system, ProZorro, allows users to view all procurements, government contracts and funds from electronic platforms, ensuring the transparency of public funding and procurement procedures. The Ministry of Infrastructure, Ministry of Defense and Ministry of Economy are among some of the government entities currently in the system. Since its 2014 launch, the system has saved Ukraine $1.1 billion in costs to the state, annually.
  5. Gas and Natural Resources: Ukraine’s elite took advantage of the discrepancy between subsidized and market gas prices, skimming billions of dollars from state funding. One major gas company, Naftogaz, is largely responsible for creating a domestic reliance on Russian-imported gas by penalizing domestic gas production and discouraging efficient energy methods. To combat this type of corruption in Ukraine, the IMF (International Monetary Fund) stepped in and insisted that the country equalize household and commercial gas tariffs and sought to improve transparency in the gas markets. With the reforms implemented by new officials, Naftogaz became a profitable contributor to the state budget and in 2018 accounted for 19.3 percent of state revenue. That revenue allowed UVG (a gas production subsidiary of Naftogaz) to boost domestic production by 4.2 percent in 2017.
  6. De-Monopolization: During Yanukovych’s presidency, the oligarch’s established formal and informal monopolies, both locally and nationwide. These monopolies formed under informal business agreements that provided corrupt officials total control over a sector of their choosing. In 2015, the State Anti-Monopoly carried out an examination of the condition of Ukraine’s various markets. The results indicated that only 42.7 percent of all markets were still competitive and 9.8 percent of them were still completely monopolized by corrupt government officials.
  7. Justice Systems: Distrust for the justice system in Ukraine is widespread. In fact, Ukraine ranked 101 out of 109 countries in the 2017 Index of Public Integrity. Opinion polls taken in 2016 recorded that only 3 to 5 percent of the population had any trust in the country’s justice system. In the same year, Ukraine took its first steps towards judicial improvement with the establishment of a new Supreme Court. This did little to gain public trust, however, as recruitment of new judicial officials was only half-way transparent. The Public Integrity Council of Ukraine found that 25 out the 113 new judges were unfit.
  8. Higher Education: Surprisingly, another major facet of corruption in Ukraine lies within the country’s institutions of higher education. Bribery demands from professors, deans and department boards have increased in recent years and show no sign of slowing down. According to a student/teacher violation monitoring website, students attending these institutions reported more than 400 violations, 41 percent of them being related to bribery. To combat this widespread corruption, the Ukrainian Parliament passed a law in 2012 that required institutions to post all financial documents online. Despite this effort, only a very small portion of universities actually complied with the new requirement.
  9. Deregulation: Since the Maiden Revolution of 2014, Ukraine has abolished several corrupted agencies and costly, dated regulations through deregulation. Among the various government agencies that Ukraine abolished for high levels of corruption were the Price Inspectorate, Traffic Police Inspectorate and the Real Estate Registration Agency. Between 2014 and 2015, the country also got rid of price regulations while it reassessed and updated others accordingly.
  10. Law Enforcement: Reform in Ukraine’s law enforcement sector is slow-moving and still largely operates under communist influence. But, in 2014 an organization known as the patrol police emerged. The patrol service has developed a positive reputation for recruiting and training officials according to a much higher standard than officers working under the country’s primary police force. In the years since its creation, the patrol service has enlisted 13,000 officers in 33 different cities nationwide. The organization accounts for only a small portion of the country’s law enforcement, but its continuing growth, increased backing from international partners and civil society organizations have proven it to be an entity dedicated to ending corruption in Ukraine.

Despite endemic corruption in Ukraine, its people have clearly not given up on improving their quality of life through reform. Since 2014, Ukraine has taken strides, big and small, to combat corrupt systems and has proven that it is capable of change.

Ashlyn Jensen
Photo: Flickr

erasing tax havens
Currently, about 50 percent of countries have poverty rates that are lower than 3 percent. Despite the declining rate of global poverty, poverty rates in poor countries remain high. The existing global system allows for both wealthy companies and individuals to benefit within the global economy through tax avoidance with the use of tax havens, but erasing tax havens and having corporations pay more legitimate and realistic taxes could eliminate global poverty and inequality.

What are Tax Havens?

Tax havens are countries or territories where corporate houses register and operate. According to tax laws, these corporate houses do not have to pay taxes on the profits they make in the area where they operate. The corporate houses do not pay taxes based on the overall group economic performance of the companies but rather based on individual entity. The multinational companies also have an element of secrecy in that tax havens share limited to no information regarding finances with foreign tax authorities.

Effects of Tax Havens

The use of tax havens is not just unique to multinational companies; some wealthy individuals utilize the system as well. The mass amounts of unpaid taxes are denying the world’s poorest governments billions of dollars. In February 2015, a few rich individuals with ties to Kenya were storing more than $560 million in bank accounts in Switzerland. The hidden wealth in tax havens could salvage the lives of four million children and 200,000 mothers in African countries. The gap between the wealthy and the poor in the world grows wider every year, and tax havens primarily fuel it. This is considering that $7.6 trillion of personal wealth hides in offshore accounts that tax havens run. This negatively impacts the fight to eliminate global poverty.

In the 1990s, 5 to 10 percent of global profits from multinational companies shifted, meaning that the jurisdictions where the economic activity took place proclaimed the profits for tax purposes. By the early 2010s, 25 to 30 percent of multinational companies’ global profits shifted. According to the International Monetary Fund, the active practice of corporate tax avoidance around the world has put the global revenue losses between $200 billion and $600 billion and lower-income countries make up around $200 billion of the global revenue loss. There are approximately 650 million poor people globally who live beneath the international poverty line of $1.90 per day. If a new country emerged with a Gross Domestic Product of the $200 billion revenue from low-income countries due to tax havens, the country could eliminate global poverty just by giving $2 every day to those 650 million people.

The Unitary Tax Approach

One way multinational companies are trying to curb tax avoidance is through the apportionment reform programs or the unitary tax approach. Through the unitary tax approach, global governments would assess tax havens’ profits as a group rather than as individual entities. This method would apportion the profits that the tax havens make as a group to each of the countries where the companies operate based on how much economic activity took place in the respective countries.

In using the unitary tax approach, multinational companies would receive taxes where employees do the actual work rather than where the ledgers hide. Due to the fact that the economic activity that the tax havens are carrying out in countries would be more authentic, a greater deal of the global shares of the corporation’s profits would distribute to the countries, and then each country would have more reign to exercise their taxing rights and tax its shares of global profits at a more reasonable rate. A global shift to the unitary tax shift approach overall would benefit not just the U.S., but also low-income countries in the fight to eliminate global poverty.

Erasing tax havens is necessary as they are detrimental to the global system in that they rob governments of the opportunity to eliminate global poverty and socioeconomic inequality by depriving governments of needed public service resources such as health and education. Erasing tax havens is vital to eliminating global poverty, and global tax laws need to modify to benefit many, not just a few.

– Cydni Payton
Photo: Flickr

Agriculture in North Korea
A massive famine struck North Korea in the 1990s with a death toll of more than one million. While grain production has nearly doubled since the famine, many agricultural scientists and international humanitarian aid liaisons believe it is not enough to sustain the nation. According to the World Health Organization, two out of every five North Koreans were undernourished in 2017 and 28 percent of North Korean children are stunted in growth due to a “largely irreversible outcome of inadequate nutrition and repeated bouts of infection during the first 1,000 days of their life.”

After Kim Jong Un took power in 2011, the government is more willing to admit its administrative shortcomings in perpetuating food insecurity across the country. In 2018, Former Premier Pak Pong Ju, a member of the ruling Korean Worker’s Party and longtime member of the political elite hierarchy, admitted an agricultural crisis had formed a chokehold on the North Korean economy. In a report, he mentioned that “Some have failed to conduct seed production and management in a responsible way and also fell short of doing proper strain distribution in line with climatic conditions and characteristics of fields.” With lower food production, many locals are going hungry and the poorest are affected the most.

North Korea has many tactics underway in order to improve agricultural conditions in their nation. Here are three strategies for improving agriculture in North Korea.

  1. A 5-Year Strategy – North Korea’s 5-year strategy for improving agricultural development is already underway. The plan includes increasing fruit, vegetable and mushroom cultivation along with improving domestic animal breeds. Furthermore, North Korea plans to upgrade fishing boats and farm equipment in order to use modern scientific methods. As 2018 came to an end, North Korea has already improved plant species with high-yield, created agricultural machinery and scientific farming, increased greenhouse farming production and increased livestock and development of fish aquaculture. They are also in the second stage of constructing the South Hwanghae Province waterway.
  2. Juche Farming Method –  The Juche Farming Method uses the nation’s government style ideals to give farmers a plot of land and a house to live in on collective farms in exchange for the food they produce. Additionally, in just six months after the method was implemented, 650 greenhouses were built across the country allowing for four to five harvests a year. Without greenhouses, locals say the soil is too salty and not sufficient enough for growing crops. Salt increases the acidity in plants which results in poor harvests.
  3. International Aid – International Aid can improve agricultural development in North Korea significantly. The American Friends Service Committee’s Publication and Advocacy Coordinator, Daniel Jasper, says his organization is working on multiple techniques to improve North Korea’s agriculture. For example, one of the organization’s projects is rice cultivation and the introduction of plastic trays. The project has been very successful, raising yields 15 to 20 percent in some farms. North Korea is also interested in joining institutions such as the International Monetary Fund (IMF) and the World Trade Organization (WTO). These institutions would allow North Korea to gain additional international aid.

Agriculture in North Korea has greatly improved since the famine in the 1990s, but the nation’s mountainous geography still makes farming difficult. With 11 million North Koreans malnourished, it is vital that the nation continues to correct the problems within its agricultural industry.

– Maura Byrne

Photo: Unsplash

Diamonds in Botswana

Botswana, located in southern Africa, has a population of 2 million. The country has achieved an impressive record of economic development and poverty reduction over the last half-century. In 1950, Botswana’s GDP per capita was $1,344. Today, it is $15,015, making Botswana a middle-income country. As the second-largest exporter of diamonds, the prudent economic management of diamonds in Botswana is responsible for much of this growth.

The Resource Curse

Paradoxically, many countries that discover large domestic reserves of natural commodities like petroleum, gold or rare-earth metals experience economic stagnation or decline. A recent paper by the International Monetary Fund explains that this trend often occurs because of commodity-dependence. When a country is heavily dependent on just one commodity export and the price of that commodity declines, there is no other revenue stream to salvage the economy. However, Botswana is a standing reproach to this trend. Judicious fiscal policy has allowed Botswana to reap the rewards of their vast diamond reserves while avoiding many potential setbacks.

Botswana’s Fiscal Prudence

Due to its capital intensive nature, the employment potential of mining is Botswana has always been limited. While diamonds make up 40 percent of Botswana’s GDP and 90 percent of Botswana’s exports, diamonds in Botswana only account for four percent of employment. As a result, the government has had to find ways to distribute the wealth generated from diamond exports across the country’s population.

Botswana has been lauded for the effective management of its diamond supply. In particular, the country has employed two strategies to ensure that its diamond exports promote sustainable, egalitarian economic growth: decoupling expenditure and revenue and investing in economic diversification.

First, Botswana has chosen not to automatically increase government spending during economic booms. Instead, when diamond prices rise and government revenue increases, Botswana often saves cash to cushion the blow during price shocks. This long-term economic mindset has prevented recessions. For example, the World Bank writes that when diamond revenues fell in 1981, Botswana used a rainy day fund to avoid any drastic decrease in government expenditure.

Botswana uses six-year National Development Plans to outline their expenditure levels. These plans involve feasibility checks to make sure that investment projects are sustainable even if government revenue falls. Once the National Development Plan has been approved, no additional projects can be added without a majority vote from parliament. These mechanisms work toward assuring that Botswana has enough reserve cash if its diamond reserves falter.

Economic Diversification

The second strategy Botswana uses to grow its economy is diversification into sectors other than diamond mining. A variegated economy is less vulnerable to commodity price shocks. Botswana has invested much of its earnings from diamond exports into incentive structures that encourage manufacturing and agriculture. In 2005, Botswana created the Business and Economic Advisory Council (BEAC) tasked with identifying barriers to diversification and crafting responsive action plans. As a result of this focus, the Botswanan economy has continued to grow even when global diamond prices fall. What is more, manufacturing today comprises 14 percent of Botswanan GDP and is more diversified than it was at independence. Even though Botswana has relied on diamonds for the last few decades, manufacturing growth in Botswana outpaced the sub-Saharan African average from 1970 to 1996.

Botswana’s Progress

Good governance has propelled Botswana from a low-income to a middle-income country. In 1985, 59 percent of the population was living in poverty. Today, that percentage has dropped to 19 percent. In 1966, 60 percent of Botswana’s government expenditure came from foreign aid. Today, only three percent of expenditure comes from foreign aid. As Botswana continues to aim for economic diversification and prudent fiscal management, they stand as an impressive example of the impact that judicious economic policy can have on a vulnerable population.

– Abraham Rohrig
Photo: Flickr

Hyperinflation

When it comes to global poverty, an important factor of a country’s economy is its inflation rate. Inflation occurs when the value of a nation’s currency decreases, but the prices for goods increase. Inflation affects many facets of everyday life, such as nationwide poverty rates, food and medical supplies.

Hyperinflation occurs when inflation rates rise quickly and uncontrollably. Hyperinflation is reached when an economy’s inflation rate is at least fifty percent for a thirty day period. However, high inflation rates consistent over a prolonged period of time also qualify as hyperinflation.  Here are three countries in hyperinflation today.

Venezuela

In the 1970s world energy crisis, Venezuela was a highly profitable oil producer. After oil prices dropped once the energy crisis ended in the 1980s, Venezuela’s chief export greatly declined in revenue and its economy began to suffer. Despite the decline in exports, Venezuela still needed to spend large sums of funding on the importation of basic goods for its people. This led to inflation, as the country dug itself into deficit spending. To pay for imported goods, Venezuelan banks then printed out paper notes not backed by actual wealth.

Now, inflation in Venezuela has reached monumental levels of devastation. Venezuela has been in hyperinflation since November 2016, when the inflation rate exceeded 50 percent. The International Monetary Fund estimates that inflation in Venezuela will exceed ten million percent by the end of 2019.

Because of this economic crisis, poverty is widespread. In 2017, the poverty rate across Venezuelan households reached 87 percent. On top of widespread poverty, food and medical supply shortages are rampant across Venezuela. The health of its people has deteriorated as weight loss and the spread of disease inflict the nation.

Currently, the Venezuelan government rejects the International Monetary Fund’s option to default on its debt. Venezuelan U.N. representatives have commented that in order for the nation to progress, it needs internal structural changes, not foreign aid.

South Sudan

South Sudan’s economy is also almost entirely oil-based. Of the countries in hyperinflation, South Sudan is the newest, gaining independence from British rule in 2011. However, South Sudan was quickly caught in a civil war from 2013 to 2018, soon after its founding. Damage to oil fields and other resources due to warfare severely affected the revenue of South Sudan’s exports. Inflation began as the struggle for resources and funding inflicted this budding nation.

South Sudan’s current economic crisis has caused mass poverty and food insecurity for its civilians. According to recent reports from the U.N., 43 percent of South Sudanese households are food insecure. At its peak, inflated food prices reached about 513 percent in December 2016. By the end of December 2018, the inflation on food prices dropped to 51 percent but is still hyperinflammatory by definition.

Unfortunately, South Sudan is currently not focusing on any poverty-reduction programs. According to the World Bank Organization, South Sudan’s overall inflation rate was an estimated 130.9 percent by the end of 2018; by the end of 2019, it is expected to drop to 49.3 percent, just under the hyperinflation threshold. However, given the financial instability of the nation, South Sudan will remain under close observation of the International Monetary Fund and similar entities for the foreseeable future.

Zimbabwe

Zimbabwe’s economy thrived in the 1980s and early 1990s, after declaring its independence from British control and creating its own domestic dollar currency in celebration. In the 1990s, however, Zimbabwe’s agricultural-based economy took a major hit after a series of crop failures. Compounded by the high costs of imports and funding for the war, Zimbabwe’s economy began to falter. In a panic to pay for goods, Zimbabwean banks rushed to print excess bills, leading the nation into hyperinflation.

Zimbabwe’s economy reached hyperinflation in March 2007, just passing the 50 percent threshold. For the next year, the nation’s inflation was a tumultuous series of highs and lows, eventually reaching a staggering 79.6 billion percent in November 2008. Eventually, Zimbabwe was forced to abandon its domestic currency, as its own population boycotted using the drastically inflated Zimbabwean dollar.

Despite the nation’s inflation rate lowering back down to 59.4 percent as of February 2019, Zimbabwe is still struggling to limit its cost of imports and boost its revenue from exports.

Potential Solutions

While there are numerous potential ways to address hyperinflation, a common solution for this phenomenon is dollarization — the abandonment of a failing domestic currency in favor of a stable foreign currency. A notable success story of dollarization is Montenegro, where the considerably weak Yugoslavic dinar was replaced with the euro, a more stable currency used widespread across the European Union. Before total dollarization, the inflation in Montenegro peaked at 26.5 percent in 2001. After adopting the euro, the country’s inflation is under one percent, as of 2019.

Of the three countries in hyperinflation today, Zimbabwe did utilize this method of dollarization; however, as of 2019, it abandoned dollarization, triggering the start of nationwide economic problems yet again. Overall, for these three countries in hyperinflation today, maintaining dollarization may be their best chance in regaining economic stability.

– Suzette Shultz
Photo: Wikimedia

Poverty in the Horn of Africa
The Horn of Africa is a peninsula that extends into the Arabian Sea and the Gulf of Aden. It includes seven countries: Djibouti, Eritrea, Ethiopia, Somalia, South Sudan, Sudan and Uganda. Here are 10 facts about poverty in the Horn of Africa, how poverty impacts the people of these countries and how their situations can improve.

10 Facts About Poverty in the Horn of Africa

  1. Food Insecurity in Djibouti: Food insecurity is a major problem for those living in rural areas of Djibouti. While those living in more urban areas of the country do not experience the same levels of poverty, 62 percent of those living in rural Djibouti have little access to food containing adequate nutrition. Djibouti’s climate may be a cause as it makes crop production difficult. As a result, it must receive 90 percent of its food supply as imports, making the country vulnerable to changes in international market prices.
  2. Drought and Malnutrition in Eritrea: Amnesty International reports that many in Eritrea struggle to meet their basic needs as drought and laws within the country make it difficult to access clean water and limit the availability of basic food supplies. Half of all children in Eritrea experience stunted growth due to malnutrition.
  3. Poverty in Ethiopia: Ethiopia is one of the most populated countries in Africa and one of the poorest countries in the world. Despite experiencing a massive surge of economic growth since 2000, 30 percent of Ethiopians are still living below the poverty line, and the United Nations has classified 36 million of the country’s 41 million children as multidimensionally poor.
  4. Conflict in Somalia: Years of conflict have destroyed much of Somalia’s economy, infrastructure and institutions. Forty-three percent of the population of Somalia live on less than $1 a day. Nearly five million Somalis depend on humanitarian aid every day.
  5. Conflict and Climate in Sudan: Like Somalia, Sudan has faced serious damage to its economy due to conflict. Sudan has also faced serious damage to its agricultural industry due to unpredictable climate and rainfall in recent years. One in three Sudanese children under the age of 5 is underweight due to malnutrition.
  6. South Sudan, Foreign Investors and Agriculture: Though South Sudan is rich in resources, particularly oil, foreign investors monopolize most of its supplies. The vast majority of workers in South Sudan engage themselves in agriculture and livestock rearing. South Sudan is incredibly vulnerable to changing patterns in rain, similar to its northern neighbors, and it frequently experiences floods and droughts that, in conjunction with conflict and depreciating currency, has left 80 percent of its population impoverished.
  7. Poverty in Uganda: Uganda has made great strides in reducing poverty over the last decade. However, it still requires more work. Poverty is still a major issue throughout the country, particularly in the northern and eastern regions, which have less access to infrastructure than the rest of the country. In northern Uganda, 29 percent of households do not have toilets and 96.3 percent of households are without electricity.
  8. The Link Between Poverty, War and Instability: The Horn of Africa is currently dealing with several wars and conflicts. There is civil unrest in Sudan and South Sudan, and terrorism plagues the entire region. In 2017, the Prime Minister of Ethiopia, Hailemariam Desalegn, suggested that poverty is the underlying cause of war and instability in the region and that the best way to foster peace in this high-conflict area is to focus on improving the economies of these countries.
  9. Digital Technologies: Digital technologies could play a major role in closing the economic gap between these countries and more financially stable regions of the globe. Digitalization of a country is relatively low-cost, and can significantly assist in alleviating poverty through a number of channels. Technology can allow those in rural communities to access education, health care and agricultural information that would dramatically increase productivity. Beyond that, technology allows women and other marginalized populations to enter the formal economy.  An International Monetary Fund study stresses the importance of boosting women’s participation in the economy to create economic growth. Taking simple steps in investing in things like mobile phones and the internet could lay groundwork not only for alleviating poverty in the region but also for ensuring equality and lasting peace. This strategy has worked extremely well in countries such as Bangladesh.
  10. The World Bank’s Initiative: The World Bank has developed an initiative that focuses on alleviating poverty in the Horn of Africa by focusing on building resilience in the region and integrating the region economically.

The Horn of Africa is one of the poorest regions in the world. These facts demonstrate that these nations desperately need the attention and assistance of the global community in order to create stability in the region, and a chance at a better life for the people living there.

Gillian Buckley
Photo: Flickr

Top 10 Facts About Living Conditions in Kosovo
Kosovo is a small, partially recognized country located in Balkan that has existed since its separation from Serbia in 2008. Despite being a young and still developing nation, it is rich in culture from its diverse populace. In the text below, top 10 facts about living conditions in Kosovo are presented.

Top 10 Facts About Living Conditions in Kosovo

  1. Kosovo’s citizens are the second poorest in Europe. The country suffers an unemployment rate of 33 percent and youth unemployment near 60 percent.
  2. Around 45 percent of Kosovo’s population live below the poverty line, with 15 percent living in extreme poverty. Most of the population lives in rural areas, living on small plots with limited industrial tools. This leads to much of the country’s citizens being forced to live on near-subsistence farming.
  3. The country does not have enough doctors. Kosovo started new health care reform in 2010. These include universal, the state ran health insurance with a network of family health centers. The latest reports found 2,664 doctors in the program with an additional 1,457 doctors in the private sector. This totals 2.2 medical doctors per 1,000 citizens, far below the European average of 3.4.
  4. Personal hygiene is a huge problem in the country. Massive inequalities exist in the lower economic classes of the country in access to hygiene and sanitation. Lack of electricity exists for only 0.1 percent of university-educated people and 10 percent of people without an education. Meanwhile, lack of personal bathrooms are reported in large numbers and are usually divided by ethnic lines (0.3 percent of Albanian households compared to 20.2 percent of Roma, Ashkali and Egyptian ethnicity households).
  5. Ethnic minorities face many legal barriers that compound their hardships. Minorities such as Roma, Ashkali and Balkan Egyptians suffer problems in obtaining personal documents needed to access health care, social assistance and education. This hinders these citizens from obtaining many of the programs designed to help low-income citizens, further trapping them in the vicious cycle of poverty.
  6. Many women face domestic violence as around 68 percent of women in Kosovo report having experienced domestic violence. This is due to a few and inadequate police and prosecutors responses. The government, however, has created a new National Strategy and Action Plan against Domestic Violence to fight against these crimes.
  7. People with diseases and injuries are at greater risk for inadequate homes, water and income. Inadequate housing is reported by 11.6 percent of those with diseases or injuries and inadequate water by 7.4 percent. Even more citizens in this situation, however, face problems with affordable conditions: 26.6 percent of citizens with health-related outcomes report inadequate affordability conditions.
  8. Kosovo’s courts are packed and overloaded. The latest reports from the International Monetary Fund showed the courts had 264,193 pending cases and a backlog of inventories ranging from 25.7 to 71.7 percent in different cases. They have 29 percent of their judicial positions filled and only five specialized judges in the lower court and only one in the appellate court. These statistics show a slow and inefficient court, hindering the legal action of citizens in the country.
  9. Kosovo is a fairly safe country. Kosovo has a crime index of 33.37. The same index is 37.27 in Serbia, 39.29 in Macedonia, 40.3 in Albania and 40.48 in Montenegro, all neighboring countries of Kosovo. In 2017, 72 citizens have been convicted of murder related crimes and 218 were convicted of robbery-related crimes in a country of 1.8 million people.
  10. There is not enough housing in the country as 21.5 percent of households report having two or more people per room in the house, and 28.7 percent have between 1.5 and 2 people per room. The United Nations had long been at work to address this problem, specifically in Prishtina. The project started in 2015 and in on-going.

These top 10 facts about living conditions in Kosovo are meant to highlight the problems that urgently need to be addressed in the country. Despite the problems presented in the text above and other problems facing the country, many laws and initiatives are in the works to alleviate citizens’ poor situation. Both international and local programs are currently working to improve conditions in the country, so far successfully. This, combined with a seemingly stable economy, provides a hopeful future for the citizens of Kosovo.

– Zachary Sparks
Photo: Flickr

Universal Basic Income in India
Universal Basic Income (UBI) is a periodic cash payment unconditionally delivered to all on an individual basis, without means test or work requirement. This practically means that everyone gets the same amount of cash, regardless of their social or economic status. 

Universal Basic Income in India might soon become a reality. If India implements this program, it would be the first state-administered basic income program in the developing world. In a country with over a billion people, it would be a large-scale endeavor, but one that could improve the existing welfare system.

Pros and Cons for Universal Basic Income in India

In January 2018, Chief Economic Advisor of India Arvind Subramanian said in an interview with the India Times that he sees one or two states implementing Universal Basic Income in the next one to two years. UBI will allow the population to receive compensation to fulfill their basic needs and Subramanian argues that it will be an improvement over the current anti-poverty schemes in that are in place because the program would be easier to administer.

Supporters of this program also claim that a UBI would be an improvement over anti-poverty interventions and inefficient subsidies that have seemingly been largely consumed by the affluent and damage the country’s overall financial stability. Opponents of a UBI program claim that incentivize work, and that the government should focus more on funneling funds into education and health care.

Subramanian is not the only supporter of UBI, as the International Monetary Fund (IMF) also believes this program could be successful. The IMF estimates that the government could provide $35 a year to every citizen if the country eliminates food and energy subsidies.

Consequences of Universal Basic Income

Implementing a UBI and getting rid of energy subsidies would result in a sharp increase in energy prices. It is estimated that if the government implemented such a program, the cost of gasoline would increase by 67 percent, the price of diesel would increase by 69 percent, kerosene by 10 percent and coal by 455 percent.

India has been in a state of premature deindustrialization in recent years, meaning that the country is either partially industrializing or not industrializing at all. This is due to structural transformations due to changes in technology, making it hard for developing countries to become manufacturing powerhouses.

United Progressive Alliance Reform

India has already had progress in cash transfer programs, as in 2012, the United Progressive Alliance (a coalition of political parties) began reforming the government’s subsidy structure by making payments directly into beneficiaries’ bank accounts. This program was instilled to cut down the corruption, reduce leakages, eliminate middlemen, better target beneficiaries and speed up the transfer of benefits to eligible recipients. This program has been deemed overall as successful, but it remains a small part of India’s welfare infrastructure.

Since no country has implemented a long-term national UBI, India does not have a practical framework to make a comparison of whether the program will be beneficial for the country or not. So far, there are only theoretical ideas of this program. Developing a UBI program requires a high initial investment and may also require the country to scrap existing welfare programs. Countries implementing UBI pilots such as Finland will give India more data to draw comparisons with.

Universal Basic Income in India is a program that is gaining traction in the country. This can be attributed to complaints with the existing welfare programs, as well as the fact that the program is being supported by the Chief Economic Advisor of India and IMF.

Since there are no real-life examples of this program, one can only hope that its implementation would be beneficial for India and the country’s goal of eradicating poverty.

– Casey Geier
Photo: Flick

How the Media Misrepresents Argentina
Most of the media coverage surrounding Argentina has dealt with the country’s economic struggles, its crime rate, and, following the recent World Cup, its soccer team. The misrepresentation of Argentina by the media is evident due to the fact that negative coverage far outweighs the positive, giving the public a one-dimensional perception of this South American country.

More than a Soccer Nation

Beyond the financial crisis, much of the recent media coverage regarding Argentina has centered around the country’s World Cup run. Soccer is an immense source of national pride and a beacon of hope for many Argentinian fans, particularly during hard economic times. But soccer, while deeply engrained within the national fabric and heavily covered by the media, represents just one aspect of the diverse nation.

Portraying Economic Crisis in the Country

Argentina’s economy has far from met the expectations associated with market-friendly President Mauricio Macri. The value of the Argentine peso plummeted in April, resulting in a $50 billion loan from the International Monetary Fund. This, coupled with high inflation, has brought persistent economic hardship to the country and poses a serious threat to Macri’s “zero poverty” campaign promise.

Much of the media coverage surrounding Argentina has focused heavily on the economic crisis and the crime associated with it. While the crisis is prevalent and a resolution is much needed, the rampant and disproportionate coverage of the crisis goes to show just how the media misrepresents Argentina. In doing so, the media taint the perception of the country and fails to portray the true image of Argentina, one of an improving economic and social condition.

Economic and Social Progress

In 2017, poverty in Argentina decreased by 4.6 percent and is currently at 25.7 percent, according to official estimates. Prior to the Macri presidency, transparency about Argentina’s poverty was scarce. The publishing of official statistics only began in 2016, after being halted by the former populist government in 2013. Macri has not only strived for zero poverty, but he has established the proper balances to hold his administration accountable, something that was not the case for Argentina’s recent past.

Macri has faced the delicate task of reducing Argentina’s poverty rate while also working to alleviate a large budget deficit incurred by prior administrations. Macri’s administration has focused on reducing this deficit with the help of the International Monetary Fund and the implementation of public-private partnerships. With private companies financing long-term infrastructure contracts, Argentina expects to attract $26.5 billion in investment by 2022, reducing pressure on the budget but also contributing to the fall in poverty through the creation of thousands of steady jobs.

The citizens of Argentina have also exhibited a strong commitment to social progress, pushing landmark legislation to the floor of Congress, the Senate and the offices of President Macri. However, media coverage of these events is brief if existing at all, failing to show a highly positive dimension of Argentina.

Justina’s Law

News that the Chamber of Deputies (lower house of National Congress) passed a grassroots piece of legislation that makes 44 million citizens organ donors was seldom reported. The official increase in donors will depend on how many citizens choose to opt out, but this legislation will undoubtedly ensure the survival of thousands of patients that are in need of organ transplantation. With the approval of this law, also called the Justina’s Law, Argentina would join the ranks of France and Netherlands in this landmark legislation.

While it is typical to hear for the negative aspects of Argentina’s economy and crime, the work being done to solve these issues or the positive impacts that the Argentine people themselves are having on their country is rarely discussed.

Though it may seem that the misrepresentation of Argentina in the media has little effect on the country’s economic and social outlook, this is far from the truth. Macri’s plan for foreign investment depends heavily on the perception of Argentina as a viable place for growth. The current administration’s commitment to accountability and poverty reduction, as well as social progress, show the world that the country is trending in the right direction.

– Julius Long

Photo: Flickr