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	Financial Crisis now a Human Calamity by AFP & agencies   April 26, 2009 (AFP)   The global economic crisis is turning into "a human and development calamity," with developing countries being hit increasingly hard, the World Bank says.   "The global economy has deteriorated dramatically ... Developing countries face especially serious consequences as the financial and economic crisis turns into a human and development calamity," they said in a statement.   The crisis "has already driven more than 90 million people into extreme poverty ... We must alleviate its impact on developing countries and facilitate their contribution to global recovery."   How to help the developing world cope with the worst global slump since the 1930s Great Depression was top of the agenda of the spring of the World Bank development committee.   The statement said their member states needed to meet pledges, including commitments to increase resources available for lending made at the London G20 summit, in order the tackle the problem.   "Given the possibility of a slow recovery, we considered the need to deploy additional resources," it said, with the World Bank to examine this issue further.   A World Bank report warned that the crisis means up to 90 million more people will remain trapped in extreme poverty this year while the chronically hungry will top one billion.   "No one knows how long this crisis will last," World Bank managing director Ngozi Okonjo-Iweala said at a news conference after the development committee met. She warned that it would be very difficult to meet the United Nations" Millennium Development Goals to reduce poverty by 2015.   "There is a widespread recognition that the world faces an unprecedented economic crisis, poor people could suffer the most and that we must continue to act in real time to prevent a human catastrophe," said Ms Ngozi Okonjo-Iweala. She added that no-one yet knew how long the global recession would last.   Ms Ngozi Okonjo-Iweala, said there was now a real crisis in Africa as a result of the worldwide recession. She said that as a result of falling demand for commodities and other exports, government budgets were falling short across the continent.   "This means that governments cannot pay teachers or health workers, and we are hearing of people who can"t eat three square meals a day," she said.   April 2009   The real victims of the global financial crisis are the the poor, by Tim Colebatch. (The Age)   Talk about pandemics. How did a crisis that began in plush, carpeted offices on Wall Street spread to the remotest villages of Africa, the mountains of Latin America and the farms of Asia?   Those most brutally affected by the global financial crisis, the World Bank tells us, will be people who had nothing to do with it. They will be poor people all over the world who are forced back into hunger and extreme poverty because the flow of money into their countries has been cut off.   On Sunday in Washington, the World Bank warned the globe"s finance ministers, of a potential "human catastrophe" if the world fails to act - above all, by increasing development aid, as promised.   Due to the crisis, Zoellick warned, "an additional 90 million people will be trapped in extreme poverty in 2009. The number of chronically hungry people is expected to climb to over 1 billion this year."   It is a cruel, dramatic reversal of what had been the best run of growth in developing countries for decades. Their output had been growing on average by 7.2 per cent a year. Much of that was in China and India, but even Africa averaged growth of 6.5 per cent. It seemed they had passed a turning point.   Poverty was not being clawed back fast enough to meet the targets of the World Bank"s Millennium Development Goals - halving the number of people in extreme poverty by 2015, achieving universal primary education, reversing the spread of AIDS - but, for the first time, the number of poor people was falling.   Then came the global financial crisis: first in the US, then in Europe, then everywhere.   How does a crisis originating in the US subprime market affect villagers in the remotest parts of the world who own no financial assets? Well, four flows of funds into their countries have been sharply reduced, or turned off.   Financial markets once oblivious to risk are now paranoid about it. Banks are having to pay higher premiums to borrow, and developing countries can borrow only at prohibitively high rates, if at all. Investors have stopped investing, either because they, too, cannot obtain funds or because they are waiting for global growth to return.   Export prices for commodities have slumped dramatically - and, in the poorest countries, commodities are generally all they have to sell. Rising unemployment in the affluent world has put many migrants out of work, cutting the flow of remittances to their families back home.   "Developing countries face especially serious consequences as the financial and economic crisis turns into a human and development calamity," the World Bank"s governing board of 24 ministers, declared on Sunday. "Hard-earned progress towards the Millenium Development Goals is now in jeopardy."   With one in six of the world"s people going to bed hungry, and extreme poverty rising rapidly, will the developed world keep its promises on development aid?
	Social Safety Nets helping people in Africa by ReliefWeb & agencies   Safety nets—programs that invest in poor people and help them enhance their livelihoods and productivity by transferring resources to poor households—have been on the rise in Sub-Saharan Africa. These programs either transfer money directly to vulnerable households, or offer labor-intensive public works jobs such as building rural roads to adults who need temporary employment during the agricultural lean season.   World Bank analysis shows that over the past 10 years, 120 cash transfer programs have been rolled out in Africa. Experience has shown that families invest these transfers in the education and health of their children, and in their farms or small businesses. Against the backdrop of a volatile global economy and frequent local climate-related events such as drought, there is significant scope to improve and expand these programs. The latest evidence shows that they are helping to reduce poverty, respond to crises, and invest in people’s futures.   Despite drought in the Sahel, Dijée Issa, a 30-year-old mother of four, has been able to beat hunger, stay healthy, and keep her children in school thanks to a small monthly cash payment from the government of Niger. The program also includes an information element on health and nutrition. Through this program Dijé and others in Chagnassou village in Niger’s Illéla locality have also learned more about health and sanitation, and both the money and the training have been helpful.   “The 10,000 CFA francs that we receive has been a great help,” Dijé says, “I pay a man 5,000 francs to bring water for my family, and I use the rest to buy rice, oil, and firewood so that I can feed my children.”   The money allows Dijé to take care of her children even during hard times in a part of the world where many are chronically poor and malnourished, and lack basic food security.   “When my daughter was born, I made sure to breastfeed her exclusively,” she continues, visibly proud of the plump baby playing on her lap. “So now look at her. Whenever I go out in public, everybody wants to carry her and play with her, because she looks so beautiful and clean and healthy.”   People like Dijé who are benefiting from social safety nets in Niger, Kenya, and Ethiopia.   “Market reforms can deliver economic growth, there is no question about that,” said Obiageli Ezekwesili, World Bank Vice President for Africa. “However, what we’re also realizing is that growth is not easily shared widely, so there must be deliberate policies to ensure that the benefits of growth reach all citizens, as much as possible.”   These policies include social safety nets, once thought to be mainly for middle-income and high-income countries, Ezekwesili said, adding that there is now strong evidence that these programs should be put in place systematically by low-income countries to fight poverty and reduce vulnerability.   Tamar Manuelyan Atinc, World Bank vice president for Human Development highlighted new evidence on social safety nets and poverty reduction in Africa. Kenya’s Cash Transfer for Orphans and Vulnerable Children program has resulted in a 13 percentage-point drop in the share of registered households living in extreme poverty, she said. And in Ethiopia, the growth rate of livestock holdings was 28 percent faster for those households participating in the Productive Safety Net public work program than for non-participants.   Over a million people lifted out of poverty in Rwanda in five years   Rwanda, which is aiming to become a middle-income country by 2020, stands out as a country that has witnessed both steady economic growth as well as very rapid poverty reduction. Minister of Finance and Economic Planning, Hon. John Rwangombwa, attributed the recent decline in poverty partly to Rwanda’s Vision 2020 Umurenge program.   This program, which identifies the poorest people in each umurenge (district), offers labor-intensive work, credit to small businesses, and cash transfers and assets such as livestock to those who cannot work. The government also pays for health insurance for the poorest people in the country.   Together with other programs to do with agriculture and job creation, the Vision 2020 Umurenge program has contributed to very good results between 2006 and 2011, according to the Minister. Poverty fell from 57 percent to 45 percent in five years—with more than one million people no longer poor. During the same time, extreme poverty fell from about 36 percent to 24 percent.   “You can’t afford to have eight million people in vulnerable conditions. The government [of Rwanda] came up with a program that would tackle these challenges and give lasting solutions not just piecemeal handouts,” Rwagombwa said. “The best thing to do with our safety nets is creating jobs for these poor people, and also supporting them to get assets that can generate income.”   John Staley, Director of Mobile Banking and Payments Innovation at Equity Bank in Kenya believes that new technology is making it more possible to have a world free of poverty, if policymakers, the private sector, aid agencies, and other partners help bring modern financial services to even the poorest people.   “We have a rather audacious goal of having 600 million bank accounts in Africa; we can’t do that if we don’t bank everybody, including poor people,” Staley said. “Safety nets help us to do this.”   The Hunger Safety Net Programme in Northern Kenya is a good example of how to do this in partnership, Staley explained. Cash driven by truck to Northern Kenya would ordinarily mean leakage along the way. But the program, implemented by the Kenyan government, uses biometrics, and smart cards to greatly reduce this risk and reach poor people more effectively and efficiently.   On the basis of a beneficiary list provided by Oxfam, Equity Bank provides money to these poor, often nomadic, people via a biometric smart card using a system of identified money agents, often shop keepers at 200 different points, he said. Leakage is prevented, people can receive money at many different points, and agents benefit from more business.   Solar technology enables this to work in places with no electricity as well. Visit the related web page
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