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South Asia Must Ramp Up COVID-19 Action to Protect People, Revive Economies

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Amid the mounting human toll and global economic fallout triggered by the COVID-19 pandemic, South Asian governments must ramp up action to curb the health emergency, protect their people, especially the poorest and most vulnerable, and set the stage now for fast economic recovery, says the World Bank in its twice-a-year-regional update.

Released today, the latest South Asia Economic Focus anticipates a sharp economic slump in each of the region’s eight countries, caused by halting economic activity, collapsing trade, and greater stress in the financial and banking sectors.  

In this fast-changing and uncertain context, the report presents a range forecast, estimating that regional growth will fall to a range between 1.8 and 2.8 percent in 2020, down from 6.3 percent projected six months ago. That would be the region’s worst performance in the last 40 years, with temporary contractions in all South Asian countries. In case of prolonged and broad national lockdowns, the report warns of a worst-case scenario in which the entire region would experience a negative growth rate this year.

This deteriorated forecast will linger in 2021, with growth projected to hover between 3.1 and 4.0 percent, down from the previous 6.7 percent estimate.

“The priority for all South Asian governments is to contain the virus spread and protect their people, especially the poorest who face considerably worse health and economic outcomes,” said Hartwig Schafer, World Bank Vice President for the South Asia Region. “The COVID-19 crisis is also an urgent call-to-action moment to pursue innovative policies and jumpstart South Asian economies once the crisis is over. Failure to do so can lead to long-term growth disruptions and reverse hard-won progress in reducing poverty.”

The impact of the pandemic will hit hard low-income people, especially informal workers in the hospitality, retail trade, and transport sectors who have limited or no access to healthcare or social safety nets. The report notes that the COVID-19 shock will likely reinforce inequality in South Asia. As played out across the region, the sudden and large-scale loss of low paid work has driven a mass exodus of migrant workers from cities to rural areas, spiking fear that many of them will fall back into poverty. While there are no signs yet of widespread food shortages, the report warns that a protracted COVID-19 crisis may threaten food security, especially for the most vulnerable.

In the short term, the report recommends preparing weak healthcare systems for greater COVID-19 impacts, as well as providing safety nets and securing access to food, medical supplies, and necessities for the most vulnerable. To minimize short-term economic pain, the report calls for establishing temporary work programs for unemployed migrant workers, enacting debt relief measures for businesses and individuals, and easing inter-regional customs clearance to speed up import and export of essential goods.

Once lockdown restrictions are loosened, South Asian governments should adopt expansionary fiscal policies combined with monetary stimulus to keep credit flowing in their economies. Since many South Asian countries have limited fiscal space, these policies should target people worst hit by the freeze on economic activity. The report urges governments to adopt temporary spending measures and coordinate with international financial partners to avoid unsustainable long-term debt levels and fiscal deficits.

“After tackling the immediate COVID-19 threat, South Asian countries must keep their sovereign debt sustainable through fiscal prudence and debt relief initiatives,” said Hans Timmer, World Bank Chief Economist for the South Asia Region. “And looking beyond the present crisis, lie great opportunities to expand digital technologies for payment systems and distant learning to unlock remote areas in South Asia.”

Due to the COVID-19 pandemic, economic circumstances within countries and regions are fluid and change on a day-by-day basis. The analysis in the report is based on the latest country-level data available as of April 7, 2020.

The World Bank Group is taking broad, fast action to help developing countries strengthen their pandemic response, increase disease surveillance, improve public health interventions, and help the private sector continue to operate and sustain jobs. It is deploying up to $160 billion in financial support over the next 15 months to help countries protect the poor and vulnerable, support businesses, and bolster economic recovery.  

REAL GDP AT MARKET PRICES IN PERCENT
CountryFiscal year2019(e)2020(f)2021(f)2022(f)
AfghanistanDecember to December2.9-5.9 to -3.83.3 to 3.95.2 to 6.2
BangladeshJuly to June8.22.0 to 3.01.2 to 2.92.8 to 3.9
BhutanJuly to June3.92.2 to 2.92.0 to 2.53.1 to 3.5
IndiaApril to March6.14.8 to 5.01.5 to 2.84.0 to 5.0
MaldivesJanuary to December5.2-13.0 to -8.56.3 to 7.35.0 to 5.5
Nepalmid-July to mid-July7.11.5 to 2.81.4 to 2.92.7 to 3.6
PakistanJuly to June3.3-2.2 to -1.30.3 to 0.93.2 to 3.3
Sri LankaJanuary to December2.6-3.0 to -0.50.2 to 1.22.0 to 2.5
  REVISION TO FORECASTS FROM OCTOBER 2019
CountryFiscal year2019(e)2020(f)
AfghanistanDecember to December-8.9 to -6.8-0.2 to 0.4
BangladeshJuly to June-5.2 to -4.2-6.1 to -4.4
BhutanJuly to June-5.2 to -4.5-3.9 to -3.4
IndiaApril to March-1.2 to -1.0-5.4 to -4.1
MaldivesJanuary to December-18.5 to -14.00.7 to 1.7
Nepalmid-July to mid-July-4.9 to -3.6-5.1 to -3.6
PakistanJuly to June-4.6 to -3.7-2.7 to -2.1
Sri LankaJanuary to December-6.3 to -3.8-3.5 to -2.5

Notes: The 2020 and 2021 numbers represent the lower and upper bound of the forecast range. For India, 2020 refers to FY19/20. e: Estimate f: Forecast. Source: World Bank

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Environment

New project to help 30 developing countries tackle marine litter scourge

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Litter is removed from a beach in Watamu in Kenya. UNEP/Duncan Moore

A UN-backed initiative aims to turn the tide on marine litter, in line with the global development goal on conserving and sustainably using the oceans, seas and marine resources. 

The GloLitter Partnerships Project will support  30 developing countries in preventing and reducing marine litter from the maritime transport and fisheries sectors, which includes plastic litter such as lost or discarded fishing gear. 

The project was launched on Thursday by the Food and Agriculture Organization (FAO) and the International Maritime Organization (IMO), with initial funding from Norway. 

Protecting oceans and livelihoods 

“Plastic litter has a devastating impact on marine life and human health”, said Manuel Barange, FAO’s Director of Fisheries and Aquaculture.  “This initiative is an important step in tackling the issue and will help protect the ocean ecosystem as well as the livelihoods of those who depend on it.” 

Protecting the marine environment is the objective of Sustainable Development Goal 14, part of the 2030 Agenda to create a more just and equitable future for all people and the planet. 

The GloLitter project will help countries apply best practices for the prevention and reduction of marine plastic litter, in an effort to safeguard the world’s coastal and marine resources. 

Actions will include encouraging fishing gear to be marked so that it can be traced if lost or discarded at sea. Another focus will be on the availability and adequacy of port reception facilities and their connection to national waste management systems.  

“Marine litter is a scourge on the oceans and on the planet”, said Jose Matheickal, Head of the IMO’s Department for Partnerships and Projects. “I am delighted that we have more than 30 countries committed to this initiative and working with IMO and FAO to address this issue.” 

Five regions represented 

The nations taking part in the GloLitter project are in Asia, Africa, the Caribbean, Latin America and the Pacific. 

They will also receive technical assistance and training, as well as guidance documents and other tools to help enforce existing regulations. 

The project will promote compliance with relevant international instruments, including the Voluntary Guidelines for the Marking of Fishing Gear, and the International Convention for the Prevention of Pollution from Ships (MARPOL), which contains regulations against discharging plastics into the sea.

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Development

Climate Finance: Climate Actions at Center of Development and Recovery

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The Asian Development Bank (ADB) called access to climate finance a key priority for Asia and the Pacific as governments design and implement a green and resilient recovery from the coronavirus disease (COVID-19) pandemic.

Speaking at the United Kingdom Climate and Development Ministerial—one of the premier events leading up to the United Nations Climate Change Conference (COP 26) in November—ADB President Masatsugu Asakawa said expanding access to finance is critical if developing economies in Asia and the Pacific are to meet their Paris Agreement goals to reduce greenhouse gas emissions and help adapt to the adverse impacts of climate change.

“We can no longer take a business-as-usual approach to climate change. We need to put ambitious climate actions at the center of development,” Mr. Asakawa said. “ADB is committed to supporting its developing member countries through finance, knowledge, and collaboration with other development partners, as they scale up climate actions and push for an ambitious outcome at COP 26 and beyond.”

ADB is using a three-pronged strategy to expand access to finance for its developing members as they step up their response to the impacts of climate change.

First, ADB has an ambitious corporate target to ensure 75% of the total number of its committed operations support climate change mitigation and adaptation by the end of the decade, with climate finance from ADB’s own resources to reach $80 billion cumulatively between 2019 and 2030. ADB has also adopted explicit climate targets under its Asian Development Fund (ADF), which provides grant financing to its poorest members. ADF 13, which covers the period of 2021–2024, will support climate mitigation and adaption in 35% of its operations by volume and 65% of its total number of projects by 2024.

Second, ADB is enhancing support for adaptation and resilience that goes beyond climate proofing physical infrastructure to promote strong integration of ecological, social, institutional, and financial aspects of resilience into ADB’s investments.

Third, ADB is increasing its focus on supporting the poorest and most vulnerable communities in its developing member countries by working with the United Kingdom, the Nordic Development Fund, and the Green Climate Fund on a community resilience program to scale up the quantity and quality of climate adaptation finance in support of local climate adaptation actions.

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Human Rights

Migrants left stranded and without assistance by COVID-19 lockdowns

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At least 30,000 migrants are stranded at borders in West Africa according to the UN. IOM/Monica Chiriac

Travel restrictions during the COVID pandemic have been particularly hard on refugees and migrants who move out of necessity, stranding millions from home, the UN migration agency, IOM, said on Thursday. 

According to the International Organization for Migration (IOM), the first year of the pandemic saw more than 111,000 travel restrictions and border closures around the world at their peak in December.  

These measures “have thwarted many people’s ability to pursue migration as a tool to escape conflict, economic collapse, environmental disaster and other crises”, IOM maintained. 

In mid-July, nearly three million people were stranded, sometimes without access to consular assistance, nor the means to meet their basic needs.  

In Panama, the UN agency said that thousands were cut off in the jungle while attempting to travel north to the United States; in Lebanon, migrant workers were affected significantly by the August 2020 explosion in Beirut and the subsequent surge of COVID-19 cases. 

Business as usual 

Border closures also prevented displaced people from seeking refuge, IOM maintained, but not business travellers, who “have continued to move fairly freely”, including through agreed ‘green lanes’, such as the one between Singapore and Malaysia.  

By contrast, those who moved out of necessity – such as migrant workers and refugees – have had to absorb expensive quarantine and self-isolation costs, IOM said, noting that in the first half of 2020, asylum applications fell by one-third, compared to the same period a year earlier.  

Unequal restrictions 

As the COVID crisis continues, this distinction between those who can move and those who cannot, will likely become even more pronounced, IOM said, “between those with the resources and opportunities to move freely, and those whose movement is severely restricted by COVID-19-related or pre-existing travel and visa restrictions and limited resources”. 

This inequality is even more likely if travel is allowed for anyone who has been vaccinated or tested negative for COVID-19, or for those with access to digital health records – an impossibility for many migrants. 

Health risks 

Frontier lockdowns also reduced options for those living in overcrowded camps with high coronavirus infection rates in Bangladesh and Greece, IOM’s report indicated.  

In South America, meanwhile, many displaced Venezuelans in Colombia, Peru, Chile, Ecuador and Brazil, lost their livelihoods and some have sought to return home – including by enlisting the services of smugglers. 

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