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The World Bank Group Announces a $12 Billion Initiative

The World BankThe World Bank Group has announced a $12 billion initiative that would allow COVID-19 vaccines, testing and treatments to be readily available for low-income countries. This plan will positively affect up to a billion people and signals the World Bank’s initiative to ensure that developing countries are equipped to distribute vaccines and testing to citizens. The plan is a part of the overall $160 billion package by the World Bank Group, which aims to support developing countries in the fight against the pandemic.

A Multitude of Goals

Since early March and April, the World Bank Group has provided grants to low-income countries to help with the distribution of health care equipment. Recognizing that the pandemic has disproportionately impacted the poor and has the potential to push up to 115 million into poverty, the World Bank Group has been active in financing an early, timely response to the COVID-19 pandemic in low-income areas. As of November 2020, the World Bank Group has consequently assisted over 100 developing countries in the allocation of medical supplies and technologies.

With the spread worsening all across the globe, the next step is to administer vaccinations. This new initiative hopes to strengthen health care operatives while also providing economic opportunities within those communities. Other expectations are increasing awareness of public health, training health care workers and focusing on community engagement. As a result, the four primary goals of the World Bank Group’s Crisis Response are to save lives that are endangered by the COVID-19 virus, protect the poor and vulnerable, retain economic stability and facilitate a resilient recovery to the pandemic.

Moreover, the World Bank Group has extensive experience with dispersing vaccines, specifically with combating infectious diseases like HIV, tuberculosis and malaria. Through these experiences, the World Bank Group understands the importance of quick, tailored distribution based on individual country needs. As a result, countries will have flexibility in how they want to receive and administer vaccines — for example, through the improvement of health care infrastructure, procurement with the support from varying, multilateral mechanisms or reshaping policy and regulatory frameworks.

Partnerships and Funding

Funding for this project will consist of “$2.7 billion new financing from IBRD; $1.3 billion from IDA, complemented by reprioritization of $2 billion of the Bank’s existing portfolio; and $6 billion from IFC, including $2 billion from existing trade facilities.”

The IDA will provide grants to low-income countries while the IBRD will be supplying them to middle-income countries. The World Bank’s private sector arm, the IFC, will be the main donor for continued economic stability within its clientele. The IFC’s support will specifically aid in the continuation of operating and sustaining jobs. The total funding will cover a broad scope to strengthen the health care sector. These solutions hope to reduce the harmful economic and social impacts of COVID-19.

World Bank Group president, David Malpass, has been working extensively with these institutions on this project. Malpass pointed out that the need for economic backing is drastically important when it comes to receiving this vaccine. Manufacturers might not deem these low-income communities as important as those in more advanced economies. Hence, it’s extremely important to provide this funding to ensure global equity and distribution.

Moving Forward

Many countries have been able to discover viable vaccine treatments. It’s important that future doses be distributed globally and equitably, as more and more people are being pushed into extreme poverty. Malpass wrote, “The pandemic is hitting developing countries hard, and the inequality of that impact is clear … The negative impact on health and education may last decades — 80 million children are missing out on essential vaccinations and over a billion are out of school.”

As the number of global cases increases each day, it is becoming even more important to provide relief to all countries. Low-income countries and communities are at the most vulnerable. This is why the World Bank Group has made it transparent that their main mission is to provide extended relief to these countries during the pandemic.

– Natalie Whitmeyer
Photo: Flickr

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Rethinking Development in Situations of Fragility, Conflict and Violence

Rethinking Development in Situations of Fragility, Conflict and Violence
Fragility, conflict and violence (FCV) threaten to crumble hard-won development achievements in developing countries around the world. The World Bank is transitioning to an FCV strategy that can help maintain development progress amidst conflict through prevention, engagement, transitional assistance and mitigation techniques.

Effects of FCV on Development

Situations of FCV have risen significantly in the past 30 years. The number has grown from approximately 40 million forcibly displaced people worldwide in 1990 to more than 79.5 million people at the end of 2019. FCV has devastated countries’ economies and left millions in poverty, while threatening to crumble hard-won development achievements. A World Bank report predicted that in the next decade, two-thirds of the world’s extreme poor will reside in countries that fragility, conflict and violence plague. Economies that fragility and conflict burden often have persisting poverty rates of over 40%, while countries that stabilized in the past decade have dropped their poverty rates by more than half.

About 20% of people living in situations of FCV experience educational, financial and infrastructure losses. Human capital development, a pivotal component of economic growth and poverty reduction also tend to decrease in conflict settings, as the health, education and skills of an entire population get put on hold. Human capital losses from fragility and conflict can decrease lifetime productivity and earnings. As a result, it leaves the youth population at a disadvantage even conflicts end.

The “New” Humanitarian Aid

Aid to situations of fragility, conflict and violence has traditionally focused on humanitarian interventions to save lives and fulfill basic needs, putting development planning aside until the restoration of peace. Although short-term humanitarian aid is crucial, situations of conflict have become increasingly protracted. This dilemma has stretched the operational capacity of U.N. agencies and non-governmental organizations (NGOs), designed to provide short-term humanitarian assistance. However, the need for long-term solutions is crucial. The World Bank has concluded that securing peace is mandatory for extreme poverty eradication, and is rethinking the way it approaches development in settings of FCV as a result. In a five-year strategy, the Bank aims to assist countries before, during and after situations of FCV through four pillars of engagement.

4 Pillars of Engagement

  1. Preventing Violent Conflict and Interpersonal Violence: Prevention is a key pillar of The World Bank’s FCV strategy because of its humanitarian and economic efficiency. According to the U.N. and World Bank, approximately every $1 invested in preventing situations of FCV can save $16 in the future. Prevention starts with addressing the drivers of FCV and assessing the risks associated with FCV.  Discrimination, injustice, economic and social exclusion, gender inequality and demographic shocks can all play a role in igniting FCV. Therefore, addressing these issues is crucial to improving peace and resilience before tensions escalate. For example, The International Development Association’s (IDA18) Risk Mitigation Regime is helping countries like Niger identify FCV risks. Risks that include youth disenfranchisement, corruption and natural resource competition. IDA18 is addressing them through the provision of resources and programming.
  2. Remaining Engaged During Crises and Active Conflicts: The World Bank aims to remain engaged during crises and active conflicts. It hopes to protect development, strengthen community resilience and establish foundations for recovery. Continuing investments into places experiencing FCV will protect human capital development and strengthen institutions. The World Bank is cooperating with humanitarian actors in Yemen to strengthen its projects during the conflict and is continuing its assistance with energy and agricultural sector development by employing Yemenis and sustaining their livelihoods during the conflict.
  3. Helping Countries Transition Out of Fragility: Transition periods are often turbulent, consequently leaving populations vulnerable to socio-economic shocks that can trigger the return of FCV. The World Bank aims to strengthen institutions, develop the private sector and improve relations between citizens and the state. Improving relations between the population and the state will ensure a peaceful transition out of fragility. During Somalia’s transition, for instance, The World Bank is helping to improve financial governance. It is also providing economic support to manage debt, strengthen the banking sector and reform public financial management.
  4. Mitigating the Spillovers of FCV: Spillovers from situations of fragility, conflict and violence can have major humanitarian consequences and strain the capacity of nearby states. The most vulnerable and marginalized communities often suffer the worst from cross-border crises such as displacement, famines, environmental challenges and public health emergencies. In order to reduce FCV spillover, The World Bank aims to strengthen its assistance to refugees and host countries. Ethiopia’s refugee policy reforms serve as a key example of spillover mitigation. The World Bank is helping Ethiopia’s government transition towards a progressive long-term settlement framework, integrating refugees into Ethiopia’s socioeconomic system. In addition, giving refugees access to employment and essential services will help build self-reliance, improve living standards and develop human capital development. With help from The World Bank and other development partners, Ethiopia has received the tools necessary to support its refugee population.

The World Bank’s new strategy is redefining the way to approach development in situations of fragility, conflict and violence. Through prevention, engagement, transitional assistance and mitigation, The World Bank is helping FCV communities prepare for a more peaceful and prosperous future.

– Claire Brenner
Photo: Flickr

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UN Report on Global Unemployment

UN Report on Global Unemployment
Global unemployment plays a key role in global poverty. After all, the logic goes that employment leads to prosperity, even if little by little. Development economists proclaim the efficacy of providing jobs, however low paying, as the means to the end of escaping poverty, regardless of location. There is some evidence for this. According to the Brookings Institute, increasing work rates impacted poverty most, with education being second. With that said, a recent U.N. report on global unemployment clouds the future of international job growth since, for the first time in nearly a decade, the global unemployment rate has risen.

Previous Global Unemployment Rise

In 2008 and 2009, the Great Recession hamstrung the United States economy in the worst way since the Great Depression nearly 70 years prior. Unemployment soared, reaching 13.2 percent nationally and 5.6 percent globally. Between 2008 and 2009, the last time the U.N. reported on global unemployment rate increases, it increased by nearly a full percentage point, according to the World Bank. The stock market crash in the United States and Europe clearly caused this, but thankfully the rate recovered and surpassed the 2009 point in 2019, returning to about 4.9 percent.

Reasons for the Present Situation

A U.N. report on global unemployment in January 2020 indicated that this rise in the global unemployment rate was due largely to trade tensions. The United Nations said that these conflicts could seriously inhibit international efforts to address concerns of poverty in developing countries and shift focus away from efforts to decarbonize the global economy. Due to these strains, the report claims that 473 million people lack adequate job opportunities to accommodate their needs. Of those, some 190 million people are out of work, a rise of more than 2.5 million from last year. In addition, approximately 165 million people found employment, but in an insufficient amount of hours to garner wages to support themselves. These numbers pale in comparison to the 5.7 billion working-age people across the world but they concern economists nonetheless.

To compound the issue, the International Labor Organization said that vulnerable employment is on the rise as well, as people that do have jobs may find themselves out of one in the near future. A 2018 report estimated that nearly 1.4 billion workers lived in the world in 2017, and expected that 35 million more would join them by 2019.

The Implications

A rise in global unemployment, like that which the U.N. report on global unemployment forecasts, assuredly has an impact on global poverty. More people out of work necessarily means more people struggling to make ends meet. The World Economic and Social Outlook places this trend in a bigger context. Labor underutilization, meaning people working fewer hours than they would like or finding it difficult to access paid work, combined with deficits in work and persisting inequalities in labor markets means an overall stagnating global economy, according to the report.

Hope for the Future

First of all, stagnation is not a decline, and a trend of one year to the next does not necessarily indicate a predestined change for the years ahead. In fact, the World Bank points toward statistics that it issued at the end of the year to support the claim that every year, poverty reduces. In 2019, nearly 800 million people overcame extreme poverty from a sample of only 15 countries: Tanzania, Tajikistan, Chad, Republic of Congo, Kyrgyz Republic, China, India, Moldova, Burkina Faso, the Democratic Republic of the Congo, Indonesia, Vietnam, Ethiopia, Pakistan and Namibia. Over a 15-year period, roughly from 2000 to 2015, these 15 countries showed the greatest improvements in global poverty, contributing greatly to the reduction of the global rate of people living on $1.90 a day or less to below 10 percent. Additionally, efforts by organizations such as the International Development Association have funded the needs of the 76 poorest countries to the tune of $82 billion, promoting continued economic growth and assisting in making them more resilient to climate shocks and natural disasters.

While the U.N. report on global unemployment forecasts a hindrance to these improvements, hope is far from lost. The fight against global poverty continues with plenty of evidence of success and optimism for the future.

– Alex Myers
Photo: Flickr

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How Bangladesh Reduced Poverty

How Bangladesh Reduced Poverty
Bangladesh is a country of 159 million people in the Bay of Bengal next to India. Bangladesh struggled with poverty and economic problems after gaining its independence in 1971. However, the country has recently seen economic growth along with a steady decline in poverty. How Bangladesh reduced poverty holds lessons for other countries and one can attribute it to a variety of factors.

Investing in Public Services

In the past six years, Bangladesh has lifted 8 million people out of poverty. The rate of extreme poverty fell from 17 percent to 13 percent, and the overall poverty rate declined from more than 31 percent to 24 percent. Bangladesh has also made great strides in education, health, infrastructure and energy. Primary school enrollment rates have risen from 80 percent in 2000 to more than 90 percent in 2015, and secondary school enrollment has increased from 45 percent in 2000 to 62 percent in 2015. This jump in education heralds a bright future ahead as Bangladesh invests in its youth.

In terms of health care, the country has achieved an amazing 40 percent decrease in maternal mortality rates, as well as ensuring that 63 percent of pregnant women received maternity care from a trained medical professional in 2015, up from 53 percent in 2007. Bangladesh has also improved its infrastructure by building new roads and water pipelines. People now have better access to schools, health facilities and workplaces, and the pipelines have increased access to drinkable water in rural areas. Lastly, Bangladesh has added over 2,000 megawatts of energy to the national grid and provided solar energy capabilities to over four million households in remote areas. These improvements help households go about daily activities and provide more consistent access to the internet for individuals and businesses. All of these improvements help explain how Bangladesh reduced poverty and may serve as an example for other countries.

Implementing Special Economic Zones

Bangladesh reduced poverty and increased its GDP and living standards thanks to the government’s decisions and international aid. The creation of special economic zones that encourage foreign investment was one major factor in Bangladesh’s economic growth. These zones ensure legal protection and fiscal incentives for investors and allow freer movement of goods and services. These policies make these zones in Bangladesh a safe and profitable place for foreign companies to invest.

Currently, garments and textiles are Bangladesh’s biggest industries, but it is expanding into technology as well thanks to these economic zones. For example, Bangladesh exported 12 industrial robots to South Korea in 2018. While Bangladesh currently has 12 special economic zones, there are plans to create 100 special economic zones and technology hubs to foster future growth. This investment creates jobs and brings money into the economy. Bangladesh is currently trying to direct that new money into new businesses and build the country’s service industries.

The International Development Association

In addition to government policy, the World Bank and the International Development Association (IDA) were also crucial to Bangladesh’s improving fortunes. Many of the country’s achievements in infrastructure, health, energy and education have come with the help of IDA financing. The IDA has given Bangladesh over $28 billion in grants and interest-free credit. This funding has been crucial to the country’s recent accomplishments. The combination of IDA funding and special economic zones has given Bangladesh the jobs and infrastructure needed to pull themselves out of poverty. International aid has been a crucial factor in Bangladesh’s development.

Bangladesh has made remarkable strides in both economic growth and quality of life. Economic policies that encourage foreign investment and help from the IDA both help explain how Bangladesh reduced poverty in the last decade.

– Josh Fritzjunker
Photo: Flickr

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The International Development Association and Global Poverty

The International Development Association
The International Development Association (IDA) is one of five institutions that work together to form the World Bank. The IDA’s main goal is to reduce global poverty by working alongside the world’s poorest countries. To accomplish this goal, the IDA issues grants and loans to development programs in impoverished countries. These development programs try to spur economic growth and improve living standards. Currently, the IDA involves itself in a plethora of projects around the world. In the fiscal year 2018, the IDA began 206 new operations.

How the IDA Works

The IDA has managed to raise $369 billion since 1960 to aid underdeveloped regions and it invested all of the money into various development projects. The IDA was able to accomplish this through communication with partner countries and contributions from wealthier nations.

Donor governments meet with receiving countries to discuss funding and a repayment plan and ensure that the development project is feasible and will be successful. The IDA releases reports from these meetings, which publicly allows anyone to learn about the organization’s future projects. The IDA also frequently consults think tanks and civil society organizations to receive feedback on their work. On top of all of this, the IDA reviews a country’s economy and recent history to determine whether it is eligible for a development project. After completing each of these steps, the IDA can determine how to allocate resources appropriately and effectively.

The International Development Association’s Work in Action

The International Development Association continues to change the lives of millions every year. In 2019, farmers in Ethiopia reaped the benefits of the Second Agricultural Growth Project (AGPII). The AGPII aims to improve agricultural efficiency and productivity in Ethiopia by teaching farmers about agriculture, improving irrigation systems and providing fertilizer. The AGPII also helps farmers access new markets which help raise their incomes. Thanks to the AGPII, one farmer increased her potato production by 400 percent and another was successful enough that they could start a family.

Improvements like the ones in Ethiopia are the norm for IDA projects and not rare. For example, in Madagascar, the IDA funded a program titled the productive cash-for-work program (ACTP) in 2015. Since then, many economically vulnerable communities have been able to improve their lives and take advantage of new economic opportunities. The ACTP provides money and training to impoverished people in exchange for work. The program has helped 31,250 households so far and has aided in the creation of small businesses.

IDA funding has had similar effects in other countries. From 2013-2018 new roads in Afghanistan helped create over two million new jobs. In the Gambia, an agricultural project doubled rice yields between 2014 and 2018. Meanwhile, in Kenya, three million people benefited from infrastructure improvements. Overall, between the fiscal year 2011 and 2018, IDA projects led to the building and repairing of more than 140,000 kilometers of roads, the gaining of clean water access for 86 million people and the immunization of 274 million children.

The International Development Association is crucial to global poverty reduction. The IDA has created a system to ensure that the world’s poorest countries receive an appropriate amount of funding and support for future social and economic development. The results speak for themselves as the IDA has changed many people’s lives for the better.

– Nick Umlauf
Photo: Flickr

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Improving Maternal Health in Guinea

Maternal health in Guinea

Guinea, officially known as the Republic of Guinea, is a country in West Africa with a significant amount of natural resources, such as bauxite and iron ore as well as gold and diamond mines that could bring the country immense wealth. However, due to its reliance on agriculture and the Ebola outbreak of 2014, the country remains in poverty and has some of the lowest health rates in the world. The philanthropic focus on eradicating Ebola has shifted funds from maternal health to ending the Ebola crisis, endangering the lives of women and children. Improving maternal health in Guinea needs to become a priority.

Maternal Health in Guinea

Of the numerous social problems facing Guinea, maternal health is one of the most detrimental to the country. The neonatal mortality rate in Guinea is 25 deaths per 1,000 live births. The maternal mortality rate is 679 women out of 100,000 live births. This compared to a global neonatal mortality rate of 18 deaths per 1,000 live births depicts a country struggling with maternal health development. Throughout the country, only 36.1 percent of children are vaccinated and approximately 31 babies die each day while 21 babies are stillborn.

One aspect of maternal health that could use improvement is prenatal care and scheduled doctor visits. In rural areas, fewer than 40 percent of women receive prenatal treatment while 71 percent of women in urban areas attend doctor visits before the birth of their child. These low percentages of prenatal care correspond to equally low rates of women who give birth in facilities with trained personnel. The main reason women do not want to give birth in facilities is the mixed-gender wings. Women feel uncomfortable giving birth where men are present.

Global Funding to Reduce Maternal Mortality

To combat these statistics, the government of Guinea and various non-profit organizations are implementing programs to help improve the health and mortality of infants and mothers. In 2018, the World Bank approved $55 million in funding for the two poorest regions of Guinea, Kindia and Kankan. This money will go to improving reproductive, maternal, newborn and child health.

The grant was distributed to two different associations. The International Development Association will receive $45 million to provide low to zero-interest rates for programs that improve economic growth and reduce poverty. The Global Financing Facility will receive $10 million to prioritize underinvested areas of maternal and infant health.

In 2015, the USAID began the Maternal and Child Survival Program in Guinea, which improves the quality and availability of maternal and infant services. The goal of this program is to empower district-level lawmakers to strengthen local centers through a bottom-up approach. Through this initiative, MCSP has established seven healthcare facilities with 42 healthcare providers and 125 healthcare educators.

Focusing on Maternal Health

In 2015, the IDA approved a grant to implement the Primary Health Services Improvement Plan as part of a five-year plan to improve maternal health, child health and nutrition in Guinea. The grant specifically targets health centers by increasing the number of health centers and the availability of equipment and supplies in these centers.

Due to many centers focusing on fighting Ebola, this plan improves the availability of medicines in health centers, restores drug funds within health facilities, supports training in financial drug fund management and covers any financial gap to produce medicines in subsequent years. Additionally, the grant provides three-year training and continuous mentoring for nurse assistants. Furthermore, it recruits unemployed nurse assistants to work at these health centers.

Improvements Made

Since these initiatives began, there has been a significant improvement in developing maternal health in Guinea. The number of births attended by trained health professionals between 2016 and 2018 improved from approximately 27,000 personnel to 44,000. There were also 8 percent more women who received prenatal care by attending at least four doctor visits before the birth of their babies.

Similarly, the Ebola Response Project, although meant to target people affected by the Ebola breakout, has positively affected maternal health development in Guinea by helping fund a new maternity center in Koba. This center helps women attain the privacy they desperately desire by providing two separate wings for men and women. At this center, specifically, a program was initiated to distribute clothes, mosquito nets and soap to expecting mothers to encourage visiting the center.

Maternal health development in Guinea has been steadily improving through programs and governmental plans; however, there is still much work to be done. Although infant and maternal mortality rates are dropping due to an increase in health centers and personnel, a continued increase in funding and a restructuring of fund management is necessary to continue to improve maternal health in Guinea.

– Hayley Jellison
Photo: Flickr

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