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Economic Development in The DRC

Economic Development in The DRC
While the Democratic Republic of the Congo has a history of extreme poverty and political instability, a recent International Monetary Fund (IMF) report stated that growth in the Democratic Republic of the Congo rebounded astoundingly from 1.7% in 2020 to a projected 6.2% in 2021. The projected growth includes impressive metrics considering that the most recent IMF projections for Sub-Saharan Africa predicted 4.5% growth. While the DRC still has improvements to make to infrastructure, public health, literacy, child mortality and access to utilities, recent reforms have proven effective in stabilizing the Congolese economy.

Background

The DRC has a history of political corruption dating back to the nation’s independence in the 1960s, “combined with countrywide instability and intermittent conflict that began in the early-90s.” This has consequently led to “reduced national output and government revenue, and increased external debt.” However, since implementing a transitional government after peace negotiations in 2003, economic development in the DRC has continued to improve, as the country reopened relations with international financial institutions and donors.

While the DRC’s economy contracted by 2.2% in 2021, inflation remained contained at 2% in 2021, despite sharp food price increases that rose by about 3.4%. The decline in oil prices in 2021 originally damaged economic development in the DRC. However, while the war in Ukraine could potentially increase inflation, “high oil prices could potentially boost the economic recovery.” This reality, while devastating to the nation’s poor, could contribute to growth and development in the DRC as the oil sector represents nearly half of the country’s gross domestic product (GDP) and 80% of its exports, making the nation the third largest oil producer in the Sub-Saharan African region. 

Differences in Sub-Saharan Governments and Economies

The primary difference between the DRC and other Sub-Saharan African nations in regard to the economic metrics is government stability. For instance, the United States’ African Growth and Opportunity Act (AGOA), a duty-free trade group, has cut Ethiopia, Mali, Guinea and Burkina Faso “over alleged human rights violations and recent coups.” This exclusion from the AGOA excludes Burkina Faso, Ethiopia, Mali and Guinea from accessing more than 1,800 products, as well as more than 5,000 products suitable for duty-free market access, or non-taxable market access, under the Generalized System of Preferences program.

The state of democracy in the DRC is questionable at best, with the U.S. State Department reporting incidents such as “forced disappearances and abductions by government and armed groups; torture by government; arbitrary detention by the government; [and] harsh and life-threatening prison conditions.” However, the relative stability of the DRC’s centralized constitutional republic has come with privileges. While other Sub-Saharan nations have faced exclusion, the DRC “regained AGOA beneficiary status as of” January 1, 2021. 

Economic Reforms

While the DRC has been in recovery mode from the economic contraction of 2021, the nation has still exceeded projections for economic growth and development due to a number of key strategies. Namely, the country includes the use of “a Fund-supported program” through which, DRC authorities adopted policies to regulate and stabilize inflation and the exchange rate. Also, debt restructuring agreements, increased oil prices and improvements in debt management have decreased public debt, which fell from 113% of GDP at the end of 2020 to 102% by the end of 2021. Ukraine-related inflation has also led to high commodity prices which have supported increased exports, revenues and international reserves.

A Need for Humanitarian Aid

While the IMF projections exceed original GDP-growth projections by the World Bank, which predicted “1.9% in 2022 and 4.1% on average over the period 2023-2024,” the conditions allowing for the DRC’s growth in economic development can be simultaneously harmful to the most vulnerable communities. For instance, the War in Ukraine, while improving commodity prices, has simultaneously led to increases in food prices which has intensified food insecurity. The DRC is also host to a number of social problems.

Infant mortality stands at a rate of 33 deaths per 1,000 live births, and access to electricity stands at 66% of the population in urban areas and only 15% in rural areas. The DRC’s access to clean water is also below the country’s “hydrological potential.” Luckily, groups like USAID offer assistance in such areas as “Agriculture and Food Insecurity, Democracy, Human Rights and Governance, Education and Global Health.” 

USAID has partnered with the government and people to improve citizens’ quality of life and the efficacy of national institutions while fighting for lasting peace. While many other African nations have suffered from the effects of coups, inflation and American sanctions, the DRC’s semblance of state stability and the intervention of humanitarian aid organizations have seemed to elevate the nation past expected metrics. One will be able to more clearly see how stable the DRC’s economy will be soon as economic projections are descriptive and not prescriptive. However, the DRC is currently exceeding predictions of GDP growth and facing less market insecurity than Sub-Saharan African nations that have faced punitive sanctions from Western nations for recent coups.

– Braden Hampton
Photo: Flickr

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Elderly Poverty in Brazil: Pension and Health Care Reforms

Elderly Poverty in BrazilBrazil’s aging population has increased substantially in recent decades. The population of Brazilians older than 60 has jumped from 5% of the population in the 1970s to 15% by 2018 and is expected to reach more than 25% by 2050. Overall, Brazil is projected to have the world’s fourth largest elderly population behind India, China and the United States by 2050. With such demographic trends, elderly poverty in Brazil is a pressing long-term challenge to address. This has implications for the country’s public pension and health care systems that provide socio-economic security for elderly Brazilians running the risk of crippling deficits without necessary reforms to sustain the fight against elderly poverty in Brazil.

Great Strides but Long-Term Problems Persist

Brazil has been largely successful in raising living standards for its elderly population in recent decades. Improved health care from the creation of the Unified Health System (SUS in Portuguese) in 1988 guaranteeing near-universal, cost-free health coverage coupled with the creation of public pension systems in the 1980s improved the socio-economic security of citizens to combat elderly poverty in Brazil.

From these reforms, life expectancies improved dramatically from 60 in the 1970s to 76 as of 2018. Brazilians also rely less on numerous children for financial support due to pension programs as the average child per woman dropped from six in the 1970s to 1.8 as of 2018.

The nation has made much progress in combating elderly poverty in Brazil through pension and health care systems, however, these improvements have created collateral problems that, unless addressed, could reverse the progress of recent decades.

Brazil’s aging population relative to the shrinking labor population poses significant fiscal problems for these programs. Without reforms, by 2050, the International Monetary Fund (IMF) projects that pension and health care spending with current demographic trends will equate to 40% of Brazilian GDP. Such an unsustainable fiscal strain underscores the need to reform these systems to ensure Brazilians can continue to build off the progress made in reducing elderly poverty in Brazil.

Labor Participation Can Boost Revenue for Elder Care Programs

Brazil’s pension programs are inefficiently funded compared to other countries. About 46% of the working population contributes payroll taxes to support pension programs in comparison to 86% in “advanced economies.” This is largely because the retirement age for Brazilians is quite low, 48 for women and 53 for men.

Because of this, the labor force is simply too small to support funding for these pension programs if current demographic shifts continue, posing major issues for combating elderly poverty in Brazil. Increasing the labor participation rate is essential to increase revenue to salvage the pension system and gains made by older Brazilians.

Increased female labor participation can play an important role in this. In the 15-64 age group, the female labor participation rate stands at 62% compared to 80% for males as of 2019. Even halving the gender labor participation gap could save Brazil 2.2% of its GDP on pension funding by 2050 through increased opportunities for women in the workplace. Encouraging early retirees to continue working is also important.

Brazilians aged 55-64 had a labor participation rate of 56% in 2014 compared to 81% for those aged 25-54. Decreasing this gap by 50% could save Brazil 1.3% of its GDP in pension funding by 2050. Raising the retirement age to above 60 could be the most prudent means to increase labor participation and make pension systems more sustainable and efficiently funded, enabling it to continue supporting elderly Brazilians and avert fiscal catastrophe that would threaten progress to reduce elderly poverty. Such reforms could reduce fiscal resources directed toward pension programs by 11% of GDP by 2050.

Cost Effective and Practical Health Care Reforms

Health care plays a critical role in combating elderly poverty in Brazil. Like the pension system, however, Brazil must implement reforms to sustainably support Brazil’s elderly population in the future. Health care spending as a percentage of GDP is projected to more than double from 4.6% in 2015 to 9.5% of GDP by 2050 without reform, placing further fiscal strain on Brazil and threatening the health care system that undergirds the progress made for Brazil’s elderly.

Practical on-the-ground reforms, however, may make the system cost-effective and ensure it continues to benefit Brazil’s elderly. Some of these reforms could include focusing on chronic, non-communicable diseases that people become acutely vulnerable to in old age and “abolishing tax deductibility of private insurance contributions” that undermine SUS funding. Furthermore, Brazil could implement education programs emphasizing healthy lifestyles and renegotiate pharmaceutical drug pricing to ensure Brazil’s health care system can remain solvent and focus on safeguarding living standards for elderly Brazilians. Improved health care has helped to reduce elderly poverty in Brazil and can continue doing so with reforms focusing on fiscal sustainability.

Brazil has made much progress in combating elderly poverty in recent decades. To safeguard these gains, the systems driving those positive changes must prioritize sustainability. Although such reforms could be unpopular politically, Brazil must find the courage must to ensure retirement remains a bridge to socio-economic security and enjoyment for Brazil’s elderly population. Brazil managed to establish a sophisticated apparatus for combating elderly poverty that has produced tremendous gains, because of this it has the capability to reform it once the willingness is there among Brazil’s leaders.

– John Zak IV
Photo: Flickr

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Argentina’s Economy Minister Resigns

Argentina’s Economy MinisterOn July 2, 2022, Martín Guzmán announced his resignation from his position as Argentina’s economy minister, which he held since December 2019, through a seven-page letter posted on his Twitter account. The decision arrived amid conflict in the government concerning the country’s current economic crisis and Argentinian Vice President Cristina Fernández de Kirchner pushing for Guzmán to leave his position. Guzmán alluded to recent disagreements “within the government coalition” as a reason for his departure. Many members of his team have also resigned.

Guzmán’s Career

On December 6, 2019, Argentine President (then-president-elect) Alberto Fernández designated Guzmán as Argentina’s economy minister. At the start of this career, the newly appointed Brown graduate had his first bill approved by the Senate just 11 days after his first day in office. The bill imposed tax increases in specific areas of the middle and upper class while providing tax benefits to the impoverished.

In early August 2020, the Argentine economy minister struck a deal to restructure $65 billion in foreign bonds. Most notably, the former minister engineered a $45 billion debt deal with the International Monetary Fund (IMF). The agreement aims to “promote growth and protect social programs” to tackle Argentina’s economic crisis.

Before resigning, Guzmán planned to head to France to discuss a $2 billion debt deal with the Paris Club of sovereign lenders.

Argentina’s Economic Crisis

Argentina’s economy has been suffering for decades. In July 2022, many Argentine sovereign bonds were worth as low as 20 cents on the dollar — a stark difference from higher rates in October 2020. Inflation in Argentina is staggeringly high, moving toward 70% by the end of 2022. As of July 2022, one United States dollar is worth about 126 Argentine pesos and this exchange rate is still increasing.

An economic disruptor includes truck drivers’ strikes, which have halted delivery of grain, “one of Argentina’s main imports,” to ports. In addition to the COVID-19 pandemic, the devaluation of the peso and a sizeable foreign debt of more than $323 billion by 2020 have sent Argentina into further economic turmoil.

Alongside these struggles, Argentina’s poverty levels are sharply increasing. Due to the severe inflation, the poverty rate in urban centers stood at 37% in the latter half of 2021 and is expected to increase to 39% after the first six months of 2022. This would equate to 500,000 more impoverished people.

The Economy’s Future

Guzmán’s resignation has raised concerns over the economy’s trajectory, most fearing it will head in an even worse direction. Other concerns regard Guzmán’s IMF deal and whether Argentina can meet these needs without the architect of the deal.

On July 3, 2022, one day after Guzmán’s resignation, President Fernández named Silvina Batakis Argentina’s new economy minister. Batakis previously served as the Secretary of Provinces in the Ministry of the Interior and as economy minister of the Buenos Aires province from 2011 to 2015. This week, she stated her belief in “fiscal balance” and her intention to follow President Fernández’s economic program.

In June 2022, the deal with the IMF that former minister Guzmán crafted underwent its first review. This is a sign that the deal may indeed make progress and ultimately come to fruition. A press release regarding this step stated that the program’s policies “will be critical to support Argentina’s economic recovery.”

There are other solutions and aids to Argentina’s economic crisis besides the appointment of a new economy minister — foreign aid. Amid this instability, at least 48 NGO projects in Argentina aim to improve the lives of the country’s poor. A notable organization is Fundación Integrar (Integrate Foundation). The foundation helps young Buenos Aires and La Pampa citizens living in poverty complete their higher education by providing financial aid and guidance to students. With the help of donations, the foundation has given higher education scholarships to 140 students to date.

In office, Argentina’s new economy minister Batakis will need to address the nation’s high inflation rate and foreign debt along with an increasing poverty rate. Yet, she is not alone in this fight — a deal with the IMF is underway and tens of organizations are serving the country’s poor.

– Sophie Buibas
Photo: Flickr

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Food, Fuel and Finance Crisis in Sri Lanka

Crisis in Sri LankaSri Lanka is experiencing an economic crisis of massive proportions.  The U.N. has dubbed it a “food, fuel and finance crisis” that is endangering millions of people. This economic crisis has been building since the onset of the COVID-19 pandemic, but it has recently culminated in a massive fuel shortage that has paralyzed the economy. The food, fuel and finance crisis in Sri Lanka is an indicator of a worldwide trend of rising prices, resource shortages and civil unrest.

Desperation and Unrest in Sri Lanka

Countries all over the world, both developed and developing have experienced the economic and social shocks of the pandemic and the war in Ukraine. Many nations are fearing a looming recession, poor health care resources amidst the pandemic and a slowing job market. For developing countries, this means a nearly complete depletion of food, energy, economic stability and COVID-19 response.

The U.N. found that three months of consistent heightened inflation have caused around 71 million people to fall into poverty. The citizens of many developing countries, including Sri Lanka are turning to public political turmoil out of desperation.

Since the end of June, Sri Lanka has been experiencing one of the worst fuel shortages in history. The demand for fuel is so high and the supply is so low that people often have to wait in line for over two days to fill their tanks. One woman said that she spends more than half of her income on fuel.

The Sri Lankan government has demanded that anyone who can must work remotely, schools have been shut down and public transportation services are almost completely stopped, according to The Business Standard. The country has essentially come to a complete standstill.

This fuel crisis comes alongside a prolonged economic catastrophe in Sri Lanka, in which citizens have been facing severe shortages of medicine and inflation that has skyrocketed to 55%. Sri Lankans are also experiencing governmental uncertainty, as their president resigned after a series of protests. The food, fuel and finance crisis in Sri Lanka also comes from a history of debt defaulting and account deficits. Sri Lanka’s economy and exports have been unstable since the 1980s and they are now crumbling as a result of the war in Ukraine, The Business Standard reports.

The Crisis in Sri Lanka is Apart from a Larger Trend

The crisis in Sri Lanka is an indicator of a more widespread food, fuel, and financial crisis that is seriously harming many low-income countries. The U.N. Office for the Coordination of Humanitarian Affairs is claiming that the war in Ukraine is causing a wave of rising prices for essential commodities – food, fuel, medicine and energy – that are plunging millions into a standard of living crisis. The crisis put in danger about 1.6 billion people in 94 countries.

In the Middle East and North Africa, the livelihoods of 2.8 million people are threatened by this crisis and over 500 million people in Asia are exposed to the food and finance crisis, according to the U.N.

International Organizations Attempt to Break the Cycle of Crisis

International organizations like the U.N. and the International Monetary Fund (IMF) are not ignoring the crisis in Sri Lanka and other countries, but they are not doing enough to help either. In order to avoid further civil unrest and slow the growing numbers of people experiencing extreme poverty, international organizations could focus on multilateral investments that pay more in capital and are focused specifically on targeted lending and crisis response measures, the U.N. reports.

The U.N. has employed its Global Crisis Response Group to administer targeted cash transfers directly to the affected countries as a form of direct aid.

Going Forward Amidst a Global Crisis

There has been widespread suffering globally due to the COVID-19 pandemic and the war in Ukraine.  However, low-income and developing countries are experiencing record-breaking levels of hunger and lack of resources. The Secretary General of the U.N. believes that solving the global crisis is not possible without first paying attention to the economic crisis in developing countries.

People in low-income countries are in desperate need of food, economic support, fuel and adequate health care. Hopefully, international organizations and high-income countries can step in and help.

– Ella DeVries
Photo: Flickr

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Tunisia’s Food Crisis: a Tale Of War, Hunger, and Decree

Tunisia’s Food CrisisTunisia, a North African country with a population of 11.8 million, is facing a dire food crisis in the wake of the Ukraine War. Recently, the country has struggled with various political and economic strife, including 14 government changes in the past decade and a slow economic revival. Reliance on foreign grain exports further exacerbates Tunisia’s food crisis. This makes it particularly susceptible to the dangerous effects of foreign conflicts. In addition, the government has issued decrees that imperil citizens’ freedom of expression.

Import Reliance and War

According to a report by the U.N. Food and Agriculture Organization (FAO), moderate to severe food insecurity affected around 25.1% of Tunisians from 2018 to 2020. Government food subsidies protected many Tunisians from the expensive cost of foreign imports and agriculture in the country for products such as vegetables and fruits is self-sustainable.

However, following the COVID-19 pandemic, the government was unable to continue providing sufficient subsidies as the prices of their imports skyrocketed, which led to Tunisia accepting an emergency loan from the International Monetary Fund (IMF) for $750 million.

In addition to the insecurity introduced by COVID-19, the war in Ukraine presents a significant threat to Tunisian’s food supply. Since the Tunisian diet relies heavily on grains and Tunisia imports around 50% of its wheat from Ukraine and Russia, the Ukraine war has disrupted regular imports and accelerated hunger within the country.

Inside Tunisia

Statistics tell researchers about the numerical values of a food shortage. However, they cannot properly show the real living conditions of the crisis. Inside the personal lives of Tunisians during recent times of food shortage, bakers are running out of ingredients for bread and the lines of customers in the bakeries continue growing. Food insecurity in Tunisia has even affected citizens’ religious practices; during Ramadan, feasting happens nightly during iftars, but with supply limitations, it was often a struggle to fulfill them.

On March 20, Tunisian President Kais Saied enacted Decree-Law 2022-14, which sentenced those who hoarded state-subsidized products, such as cartels hoarding flour, to 10 to 30 years in prison. This decree’s goal is to protect against ongoing price gouging of grain products. In addition to the president’s decree, the government has also focused on police raids of warehouses and placing the blame for empty grocery store shelves on small businesses.

Amnesty International, a non-governmental organization that fights for human rights, suggested that President Kais’ anti-speculation decree could endanger citizens’ freedom of expression because it claims to target the spread of misinformation. Instead of simply protecting citizens from misinformation, the decree prevents citizens from speaking out about food shortages for fear of prosecution.

World Bank Loan

On June 28th, the World Bank’s Board of Executive Directors approved a $130 million loan to help alleviate the devastating effects of Tunisia’s food crisis in the wake of the Ukraine war. Emergency support will be provided, such as imports of wheat and barley for dairy production.

In the long run, the loan could assist Tunisia to become more self-sufficient and less reliant on foreign grain imports. This decision also pushes for the reevaluation of weaknesses in the grain value chain, which greatly contributes to food insecurity globally.

– Caroline Zientek
Photo: Flickr

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Increases in Food Prices Cause Concern for the Poor

Increases in Food Prices
The pandemic has been a source of economic stress for several industries globally, resulting in mass inflation and government intervention in order to alleviate the harmful effects of such rises in costs. A global index that the United Nations Food and Agricultural Organization performed found that food prices in January 2022 were at their highest level since 2011 when Egypt and Libya experienced political uprisings. Former Chief Economist at the International Monetary Fund (IMF), Maurice Obstfeld claims that it “wasn’t much of an exaggeration” to say that the world is approaching a significant global food crisis. Developing economies are experiencing some of the most severe increases in prices, which has detrimental effects on populations in poverty. Here is some information about how increases in food prices cause concern for the poor.

About the Food Crisis

Increases in food prices are not limited to one food industry. Foods are experiencing massive increases in prices. Cereal prices have increased 12.5% and dairy has increased 18.7%. From April 2020 to December 2021, the price of soybeans has risen 52% and coffee prices have risen 70% due to the pandemic. Supply chain issues have caused a struggle, especially for economies with high demands that are import-based during the pandemic. Spikes in all costs of goods are related to one another, which is evident in the rising oil prices.

Oil prices have risen to levels comparable to the oil crisis during the 1990s, which has raised food costs due to the energy industry’s involvement in transporting and producing food. Extreme weather conditions could be a factor determining food prices. For example, Brazil has undergone harsh droughts that prevent coffee beans from flourishing. Uncontrollable factors that target the poor have largely driven the food crisis.

How Those in Poverty are Most at Risk

Unfortunately, the nations that the increases in food prices have affected the most are the most vulnerable to economic crises and have large populations in poverty. According to World Vision, food prices rose by an average of 2.9% in the U.K., 3.6% in the U.S. and 4.8% in Japan and Canada between February 2020 and July 2021. On the other hand, prices increased in countries such as Myanmar which had price increases of 54% and Timor-Leste, which experienced increases of 17.7%. The nations have reported high levels of poverty during the pandemic, with more than 3 billion people not having access to healthy foods.

Food insecurity is running rampant in developing countries, while the United States is surviving flawlessly in comparison. One can see such disabilities simply in how the average citizens of each region spend their money. According to the IMF, people in Latin America and Africa are expected to spend 50%-60% of their wages on food while people in the United States spend about one-seventh of their income on food. A rise in food prices means that Latin American and African citizens will have to spend extremely large sums of their income on food.

A Nature food study found that by the end of 2022, more than 283,000 children under the age of 5 years old could perish from malnutrition as a result of this food crisis and 13.6 million children suffer from acute malnutrition. Certain areas in poverty in Asia do not suffer the implications of the increases in food prices because of their plentiful grains. However, Africa, South America and the Middle East region are most likely to feel the effects of food shortages because they are heavily dependent on food imports.

In addition, low-income nations including Brazil, Argentina and Turkey have suffered due to currency depreciation against the dollar, which is the standard for international food commodity prices. In Africa, bad weather and conflicts in the Dominican Republic of Congo (DRC), Ethiopia, Nigeria and more have disrupted transportation routes and risen food prices. Developing nations are most at risk for increases in food prices, disproportionately affecting poorer global populations rather than populations in high-income countries.

Ways to Drive Down Food Prices

The pandemic is a special case of increases in food prices. However, there are at least two meaningful ways that could prevent massive spikes in food prices in the near future.

  1. Change global rules on food trade. Many governments are not as ambitious as they could be in reforming trade policies to prepare for price spikes. Measures that could reform trade include banning export restrictions on food staples while increasing individual government’s support for farmers domestically through new rules that protect producers in other nations. This would benefit food price stability and increase the predictability of the market to better prepare governments for changing prices.
  2. Increase public investment in farming and agriculture. A study from Cornell University found that if the United States increased public investment by $33 billion, hunger could reach a resolution. If other nations contributed to this effort, global poverty rates could swiftly reduce. Africa is especially in need of such kinds of investment, which is one of the nations that increases in food prices have affected.

The global increases in food prices rightly cause some serious concerns about food insecurity, especially for residents of developing nations that are in poverty. There are ways to create positive change to prevent crises from occurring again. Nations should concentrate on providing food to their citizens in need and high-income countries must prioritize the lives of the hungry abroad and domestically.

– Rachel Reardon
Photo: Flickr

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Child Marriage in Afghanistan On the Rise

Child Marriage in Afghanistan
With limited resources and an absence of income to support themselves, Afghan families may sell their children to make ends meet, resulting in a significant level of child marriage in Afghanistan. To illustrate, the 9-year-old Parwana Malik family sold her to Qorban, a 55-year-old man, for $2,200 in an arrangement of sheep, land and cash. Thinking about what her future holds as a wife to Qorban, Parwana fears her husband will beat her and force her to work in his house. Regrettably, however, Parwana’s family does not have enough money to afford necessities to keep all its members alive and healthy. In fact, before her family sold her, it sold Parwana’s 12-year-old sister.

Background of Child Marriages in Afghanistan

Child marriage in Afghanistan can cause suffering and damage in a child’s life. For example, many child brides experience domestic violence, discrimination, abuse and poor mental health. Child marriage in Afghanistan is common but illegal. The minimum age for marriage is 15 or 16 years old for women and 18 years old for men. In the past, many families opted for child marriages to pay back any personal debts, settle disputes, or create friendships with rival families to decrease their enemy count.

In 2016, the National Ministry of Women and the Ministry of Information and Culture created the National Action Plan to Eliminate Early and Child Marriage, bringing organizations from 90 different countries together to help end child marriage in Afghanistan and ensure the legal age of marriage be 18.

However, this act was short-lived. Now, with the increasing hardships of acquiring money and jobs, Afghanistan families are selling their young daughters “for large dowries from wealthy people, and the husbands are usually much older,” according to UNFPA.

Afghanistan is a country that has always relied on foreign aid, with 75% of its finances coming from grants from the United States and other countries. Unfortunately, when the Taliban took control of Afghanistan, the country’s economy worsened, leading to difficult living conditions for many people.

Poor Economy Causing an Increase in Child Marriages

When the United States military withdrew, the Western powers and international organizations stopped sending humanitarian aid by blocking overseas equipment and valuables to focus their time on taking the Taliban away from power.

Additionally, the World Bank and International Monetary Fund (IMF) halted payments. As a result, Afghanistan workers and people are not receiving income to feed themselves and pay for other expenses, leading to families selling their children for money.

According to the World Food Programme (WFP), “recent surveys have revealed that only 5% of families have enough to eat every day.” Not only are they not receiving enough money to support themselves, but there has also been an increase in food and cooking oil prices and the country has lost about 40% of its wheat crops.

As winter approaches, WFP mentions that Afghanistan families will run out of food, pushing them further to the brink of starvation. For example, to avoid selling his daughter, Parwana’s father would travel to the main cities of Afghanistan hoping to find a job, but he was always unsuccessful.

In addition, he would ask for money from other family members, while his wife would beg their neighbors for food, but they received little assistance. Having to take care of eight other family members, Parwana’s father felt obligated to sell Parwana to keep the rest alive, according to CNN.

Where Afghanistan is Receiving Help

Fortunately, WFP is helping Afghanistan’s dire situation and improving their nutrition to rebuild their strength. According to WFP, it has “provided 6.4 million people with food assistance, including more than 1.4 million people since the Taliban takeover.”

In September 2021, WFP sent 10 trucks into the country with nutritional supplements for young children and pregnant and breastfeeding mothers. Currently, WFP has a team of people in the most remote parts of Afghanistan to deliver food to communities they might not reach in the winter months due to blockades of snow.

Not only is WFP asking for $2.6 billion in 2022 in aid for Afghanistan, but the U.N. has made an emergency appeal for $606 million to meet areas that need it the most. Although the United States and other countries are not sending any aid into the country, Afghanistan is receiving relief elsewhere, improving the lives of many and decreasing the number of child marriages in Afghanistan.

– Kayla De Alba
Photo: Flickr

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Impact of COVID-19 on Poverty in Ecuador

Impact of COVID-19 on Poverty in EcuadorEcuador is a South American country with a population of more than 17 million. The country relies heavily on oil exports and was battling a global oil crisis when the first COVID-19 case broke out there in February 2020. Since then, the combined effects of the oil crisis and COVID-19 have created many problems for Ecuador. However, there are many sources offering aid to alleviate the impact of COVID-19 on poverty in Ecuador.

The Impact of COVID-19

As the COVID-19 pandemic spread across the world, Ecuador was one of the hardest-hit countries. Not only was it the first Latin American country affected but it also ranks ninth worldwide in confirmed deaths per million, according to the World Health Organization. The impact of COVID-19 combined with the effects of a global oil crisis could cause up to an 11% decrease in GDP for the nation.

Organizations Offering Aid

Despite the negative effects people across the world have felt and the impact of COVID-19 on poverty in Ecuador, organizations are helping the country recover.

  • U.S. Department of State – The Department of State/U.S. Agency for International Development sent almost $18 million in aid to Ecuador. This will fund improvements to the medical system, purchase rapid test kits and provide medical and personal protective equipment.
  • International Monetary Fund – On Sept. 30, 2020, the Executive Board of the IMF approved a “$6.5 billion Extended Fund Facility arrangement” with the goal of helping Ecuador recover from the economic impacts of COVID-19. By providing these additional funds, the Ecuadorian government will be able to spend more on health and education services. The government can also give cash transfers to Ecuadorians who lost their jobs because of the pandemic.
  • The World Bank – The World Bank provided a line of credit of $500 million to help the Ecuadorian government support families affected by COVID-19. In addition to this, it approved “$14.1 million in nonreimbursable resources from the Global Concessional Financing Mechanism” to provide additional support to the government for its admittance of a large number of refugees.
  • UNICEF – UNICEF reallocated $2.7 million in funds to help with the COVID-19 response. These funds were used to provide PPE, handwashing stations, nutritional supplements, hygiene materials and teachers to help distribute supplies and educate the population on proper sanitation techniques. In addition, UNICEF also provided funds to help cash transfers to Venezuelan refugees who have been unable to receive any from the Ecuadorian government.

There are also other non-governmental and international organizations that are providing aid to the people of Ecuador. The services provided range from telemedicine and hospital care to assisting with sanitation efforts. The U.S. Embassy and Consulate in Ecuador has a list of organizations that are active in Ecuador. It is working to help with the recovery.

Next Steps

As the country faces a difficult recovery, international support is vital to jumpstart the economy and support Ecuadorians. The government will need help to continue providing the necessary equipment, testing and social safety nets for the impacted population. Donating to organizations or urging representatives to continue supporting these forms of aid are great ways to help.

Despite this large impact of COVID-19 on poverty in Ecuador, aid increases recovery efforts. International organizations, foreign governments and non-governmental organizations are working hard to provide funding and supplies to help Ecuador.

– Taryn Steckler-Houle
Photo: Flickr

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How Pope Francis Spent 2021 Working to Help Reduce Poverty

Help Reduce Poverty
In light of the global pandemic, Pope Francis has kept busy advocating for poverty reduction around the world. Francis spent the year 2021 mending relationships between the Catholic Church and the Middle East and offering support to healthcare workers. Here are some of the most important things the Pope did in 2021 to help reduce poverty.

Advocation to Reduce the Debt of Impoverished Nations

Pope Francis delivered a statement in April 2021 at a meeting that the World Bank Group and International Monetary Fund (IMF) hosted. Mostly, he discussed how impoverished nations should receive a greater share in decision-making for the international market. He also pushed for debt relief and reduction for nations struggling during the pandemic. “The pandemic, however, has reminded us once again that no one is saved alone,” Francis wrote.

He also stated that “a spirit of global solidarity also demands at the least a significant reduction in the debt burden of the poorest nations, which has been exacerbated by the pandemic. Relieving the burden of debt of so many countries and communities today is a profoundly human gesture that can help people to develop, to have access to vaccines, health, education and jobs.” The Pope’s statement highlighted the “ecological debt” all nations owe to the environment. He also remarked that ecological degradation and biodiversity loss are manmade issues. He asserted that the issue could come to a resolution if impoverished nations, generally the ones environmental challenges most affect, can put their finances toward combating it.

Francis Became the First Pope to Visit Iraq

With the events of 9/11 and the Israeli-Palestinian conflict long exacerbating Islamophobia, Pope Francis’s arrival in Iraq marked a new beginning for Catholic-Muslim relations. Nostra Aetate, which Pope Paul VI issued in 1965, decreed that the Catholic Church must examine its relationships with non-Christian religions. The declaration contains a section dedicated to Islam, which urges mutual understanding in the name of peace and freedom. Pope Francis attempts to follow Nostra Aetate and continues to extend respect for the Islamic religion. He desires to mend the relationship between the two faiths.

While in Iraq, Francis met with Ayatollah Ali Al-Sistani, the leader of Iraq’s Shiites, twice nominated for the Nobel Peace Prize. The Pope also met with Daesh’s terror survivors and called for peace between Christians and Muslims. Pope Francis urged that Christians and Muslims let go of their past and work toward rebuilding Iraq.

Pope Francis has Continued to Donate Around the World

Throughout the pandemic, the Pope continued his charity work for healthcare workers and affected families. During his trip to Iraq, Francis donated $250,000 to families in Baghdad. Francis also extended support to a women’s healthcare center in India. In May 2021, Francis donated 20,000 euros to the Shanti Ashram women’s health and social center in Coimbatore, India, which supports around 50,000 women and children. The center had hosted an international online conference with a goal of raising 60,000 euros, but it fell short. Pope Francis donated 20,000 euros to make up the difference.

Pope Francis did not just donate financially, he also supplied several medical facilities with medical equipment. The Apostolic Nuncio in Colombia confirmed that the Pope sent PPE and four respirators to the San Francisco de Asis Hospital and the Santiago Clinic. The pandemic hit their area particularly hard. The Pope donated respirators to eight other countries as well, including Bolivia, Syria and South Africa.

Moving Forward to Help Reduce Poverty

Pope Francis has shown that generosity always comes first, especially in a global pandemic when poverty is on the rise. Under his leadership, the Catholic Church will continue to promote charity work and peace in the Middle East and help reduce poverty.

– Camdyn Knox
Photo: Pixabay

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The Impact of COVID-19 on Poverty in South Sudan

The Impact of COVID-19 on poverty in South SudanAs the world’s youngest country, South Sudan faces many obstacles to economic and political stability. Continued conflict, natural disasters and COVID-19 further exacerbate the developing nation’s economic strife in the aftermath of years of civil war. Outside of foreign aid, South Sudan’s economy heavily relies on two main sources: oil production and agriculture. Both these sources experienced the impact of the COVID-19 pandemic, negatively affecting economic growth and livelihoods in the country. The impact of COVID-19 on poverty in South Sudan calls for the support of foreign aid in order for the country to successfully recover.

South Sudan’s Oil Industry

South Sudan is one of the most oil-reliant countries in the world. More than 90% of its revenue and more than 70% of its GDP stems from its abundant oil fields. Since gaining its independence, South Sudan produces nearly three-quarters of former Sudan’s entire oil output, equating to almost 500,000 barrels per day. However, the volatile oil industry is experiencing a lower demand and a decline in prices due to the pandemic. Regarding the global oil demand, “containment measures and economic disruptions related to the COVID-19 outbreak have led to a slowdown in production and mobility worldwide, producing a significant drop in global demand for oil.”

COVID-19’s Effects on Agriculture and Food Security

The agricultural sector accounts for 15% of GDP in South Sudan and employs roughly 80% of South Sudan’s population. With more than 80% of the population residing in rural areas, agriculture, livestock farming and fishing make up the livelihoods of many households.

A devastating combination of flooding, drought, locust swarms and the pandemic created high levels of food insecurity in South Sudan. More than 6 million people are facing crisis-level food insecurity and roughly 1.4 million children under 5 may suffer from acute malnourishment in 2021.

The IMF Assists

In response to the worsening humanitarian crisis, the world continues to reaffirm its commitment to eliminating poverty in South Sudan. The International Monetary Fund (IMF) approved a disbursement of  $174.2 million in March 2021 for emergency assistance to South Sudan in the wake of COVID-19. The assistance aims to provide economic relief due to the collective impact of plummeting oil prices, floods and the pandemic in general. According to the IMF, the funding will “finance South Sudan’s urgent balance of payments needs and provide critical fiscal space to maintain poverty-reducing and growth-enhancing spending.”

World Bank Projects in South Sudan

On June 8, 2021, the World Bank announced two new projects equating to $116 million to curb poverty in South Sudan by committing to “strengthen the capacity of farmers, improve agricultural production and restore livelihoods and food security.” The first project, the South Sudan Resilient Agricultural Livelihoods Project (RALP), amounts to $62.5 million and commits to training farmers to better manage their businesses, utilize new agricultural technology and implement climate-smart practices to improve agricultural output. The project will also assist farmers with “tools, machinery and seeds required to improve productivity.”

The second grant of $53.7 million supports the Emergency Locust Response Project (ELRP). The grant will fund South Sudan’s response to desert locusts. The project will provide income opportunities to vulnerable people to assist them in producing more food and improve their economic situation. The project also encourages “the restoration of pasture and farming systems” in the region.

The Road Ahead

The World Bank expects levels of poverty in South Sudan to remain high for the time being due to food insecurity and the lack of access to essential goods and services. The impact of COVID-19 on poverty in South Sudan is harsh. Data as of April 2021 indicates that 82% of the population lives below the poverty line. However, the recent aid to South Sudan gives the country’s oil industry and agricultural production an opportunity to recover to pre-pandemic levels. The government’s priorities lie in addressing the lingering conflict and stabilizing its economy amid an economic, humanitarian and public health crisis. With continued aid and support, South Sudan can successfully recover and achieve stability.

– Gene Kang
Photo: Flickr