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Time to Sound Alarm Bells on Climate Change: An Economic Perspective

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The year 2020 marks the beginning of a new decade. The world as we see today has risen from the ashes of Global Financial Crisis of late 2000s and the hegemony of a few developed countries. The global economic and political landscape has endured a number of changes over the past decade- Fukushima Daiichi nuclear disaster, the Arab Spring of 2011, the rise and fall of ISIS, Refugee crisis sparked by people fleeing war persecution and poverty, the Ebola pandemic, European Sovereign Debt Crisis of 2012, BREXIT, discovery and commercialization of Shale in the USA, trade rivalry between the two behemoths- USA and China, China’s debt diplomacy through One Belt One Road (OBOR), Paris Climate Agreement of 2015 and the American fall out. 

Of all the themes that gripped the world in the recent memory, none deserves more attention than the spectre of a world ravaged by excesses of human greed and neglect of environment. The burning of Amazon rainforests and vast swathes of forests turning to ashes in Australia once again reminded the world of the pertinent need to focus on the challenge of climate change. More recently, the threat of a giant locust storm from the Horn of Africa to the farmlands in India is gripping the Eastern hemisphere. Studies have linked higher temperatures and higher than usual rainfall with more damaging locust swarms. According to Food and Agriculture Organisation, a square km sized swarm contains about 40 million locusts which eat as much food in one day as about 35,000 people. This threat to food security due to climate effect should send the alarm bells ringing in the high and mighty corridors of world powers. This article is an attempt to trace out the contribution and preparedness of comity of nations to deal with the challenges of climate change in terms of policy and the economic cost of not acting while we still have a chance at saving the humanity from the ferocity of nature.

The Earth’s temperature is maintained by an envelope of gases that traps the heat from the sun. However, when the concentration of these greenhouse gases increase in the atmosphere, the heat budget goes hay-wire and the temperature starts to rise. The heightened temperatures can lead to melting of ice caps, rise in sea levels, flooding of coastal cities (some of the world’s dense metropolitan areas are located on coasts), decline in soil productivity, fall in food production, increased pest attacks, increase in pathogen-related diseases, extreme weather events, desertification, famines, epidemics and the list goes on.  As the world is under the biggest ever lockdown due to COVID-19, the global community is struggling with crippling economies, and the writing on the wall is clear- the world is not prepared for such pandemics. An apposite question to ask here is, are we ready for the forthcoming challenges posed by climate change? Do we really have a feasible action plan in place to address the current and future challenges awaiting us?

In the 20th century, climate was neither the priority of developed nor the developing nations. Focus was on turning the wheels of economic growth as fast as possible. Climate change first made its entry in the global parlance as late as the 1970s. The UN Conference on Human Environment 1972, popularly known as the First Earth Summit, laid out the principles concerning environment and development and raised the issue of climate change for the first time. The First Scientific World Climate Conference was held in 1979 which eventually led to the creation of Intergovernmental Panel on Climate Change (IPCC) in 1988. The Second Scientific World Climate Conference 1990 considered the IPCC first assessment report highlighting the risk of climate change which paved the way for the United Nations Framework Convention on Climate Change (UNFCCC) at the Second Earth Summit in Rio de Janeiro in 1992. Enforcement of UNFCCC in 1994 formalised the climate change negotiations at the world level and from here began the string of Conference of Parties meetings with the latest being held in Madrid, Spain in 2019. Alongside the climate change negotiations, need for sustainable development has also caught the attention of the world leaders with the Rio Earth Summit of 1992, World Summit on Sustainable Development 2002, Rio+20 summit in 2012. The Brundtland Commission’s conception of sustainable development in 1987 marked a comprehensive shift in viewing development and environment as complements to one another. 

Though the scientific community highlighted the challenge of climate change late with the passage of more than a century since the industrial revolution, the world economies and leaders haven’t yet woken up from their slumber, notwithstanding an entire gamut of conferences and meetings mentioned above. The world has been pumping in greenhouse gases in the atmosphere ignoring the climate cost of growth.

The Kyoto Protocol was considered to be the ‘star’ agreement of the negotiations imposing binding emission reduction target of 5 percent below the 1990 levels over the 5-year period of 2008-12 on three-six industralised countries and the European Union. The Doha amendment of 2012 extended the commitment period to 2020. However, the year 2020 is here and only 137 parties have ratified against the requirement of 144 for the amendment to come into existence. This highlights the lax attitude of the world leaders to the challenge of climate change.

The climate scientists heaved a sigh of relief with the signing of Paris Climate Agreement in 2015, with both the North and the South coming together to contribute towards emissions reduction according to their ability laid out in Nationally Determined Contributions (NDC). However, the NDCs fall way short of achieving the target of limiting the global temperature rise to below 2 degree Celsius (preferably below 1.5 degree Celsius) above the pre-industrial levels by 2100. With the withdrawal of USA, the second largest carbon dioxide emitter in the world, the resolve of Paris Agreement has come under serious doubt.

The Earth is already 1.1 degree Celsius warmer compared to preindustrial times. As per the data of World Meteorological Organisation, 2019 was the second hottest year after 2016, and every decade since 1980s has become warmer than the previous one. Average temperatures for 2014-19 were the highest on record. According to WMO Secretary-General Petteri Taalas, we are well on our path to a 3-5 degree Celsius rise in temperatures by end of century with the current rate of emissions.

The economic cost of climate change has been hard to grasp for the world at large. According to a Working paper published by National Bureau of Economic Research in 2019, a continued increase in average global temperatures by 0.04 degree Celsius per year under “business as usual” approach can reduce global GDP per capita by as much as 7.22% by 2100. The hardest hit would be the least developed countries of tropics and no country would gain economically from global warming. As per World Bank, an additional 100 million people worldwide are at the risk of being pushed into poverty by 2030 due to climate change. Climate disasters also extract a cost in terms of damage to infrastructure such as road transportation and power generation to the tune of $18 billion annually in low and middle-income countries, with wider disruptions to households and firms costing atleast $390 billion a year. According to a WHO Report on Health in 2018, health complications due to air pollution in 15 countries that emit the most greenhouse gases are estimated to cost more than 4% of their GDP. Air pollution causes 7 million deaths globally annually, costing $5.1 trillion in welfare losses.

The Covid-19 pandemic has thrown at us first-of-many challenges of this century, wherein it has become pertinent for us to introspect the question “growth at the cost of what?”. As we continue to expand and encroach into fragile ecological regions of the planet in quest for growth, we are increasingly putting the health of our ecosystem in jeopardy. While Covid-19 has caught the world unawares and severely crippled its health infrastructure with more than 2 lakh deaths and counting, climate change is a hidden enemy lurking behind these ever often pandemics- earlier it was Ebola and now Covid-19. Failure to address climate change will threaten human lives, livelihood, and ecosystem in an unprecedented manner.

As countries plan to restart their economies post the Covid-19 pandemic, it’s time to channelize our resources to ‘building back better’. While rebuilding lives and creating livelihoods, the economic stimulus needs to focus on supporting sustainable business and personal practices. Air pollution levels have fallen across the major industrial cities of the world in the wake of the pandemic and subsequent lockdowns, there is a need to sustain this in the post-pandemic world. The nature is rebounding when the humans have retreated from the streets. Therefore, there is a need to devise sustainable strategies- be it work-from-home for the majority or giving up plastics or commuting on public transport. Every individual effort counts.

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Economy

An Uneven Recovery: the Impact of COVID-19 on Latin America and the Caribbean

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Employment rates in some Latin American and Caribbean countries have experienced a relative recovery, although in most, rates fall short of pre-pandemic levels. The quality of available jobs has also declined, as has the number of hours of paid work per week, according to data from a new survey by the World Bank and the United Nations Development Program (UNDP).

The High-frequency Phone Surveys, the second phase of which was implemented this year in 24 countries of the region, provides a snapshot of families’ well-being and their perceptions regarding the crisis. The goal is to take the pulse of the region and measure the impacts of the pandemic in key areas such as the labor market, income and food security, gender equality, and household access to basic services, such as education, health (including the COVID-19 vaccine), Internet connectivity and digital finance. The survey took a representative sample of the population aged 18 and over with access to a telephone in each country.

“The COVID-19 pandemic underscored the pre-existing inequalities in the region, where the most vulnerable and poorest groups have been disproportionately affected,” said Luis Felipe López-Calva, UNDP Regional Director for Latin America and the Caribbean. “This survey allows us to take the pulse of the region and propose evidence-based solutions.”

“The pandemic severely impacted millions of families in the region,” said Carlos Felipe Jaramillo, World Bank Vice-president for Latin America and the Caribbean. “These surveys we present today are crucial for obtaining current data on the scope of the crisis and for recommending informed measures to help improve the quality of life in our countries.”

Survey results demonstrate that the crisis particularly affected women, both because of the stronger initial impact on them and their slower labor market recovery. Mothers of young children (aged 0 to 5 years) have been most affected. In fact, a year and a half after the onset of the crisis, women are twice as likely as men to be unemployed owing to the pandemic. This situation is exacerbated by an increase in women’s household responsibilities, including supervision of children in remote education, and a higher incidence of mental health problems.

For the region as a whole, the employment rate stood at around 62 percent, almost 11 percentage points below the pre-pandemic level. Employment rates surpassed pre-crisis levels only in Guatemala, Nicaragua and El Salvador.

Moreover, formal employment fell 5.3 percent in the region while self-employment grew 5.7 percent, and the proportion of workers employed in small businesses (maximum of four workers) increased by 8 percent. These figures point to a deterioration in the quality of available employment. Even among the employed population, regional survey results identified a decrease in weekly hours of paid work, from 43 to 37, confirming this negative trend.

The survey data found that 28 percent of people employed before the pandemic lost their jobs, and more than half (17 percent) of those with a job before the pandemic have left the labor force. These impacts disproportionately affected women with young children: 40 percent of female workers over 18 with children aged 0 to 5 years lost their pre-pandemic job, compared to 39 percent of women in general and 18 percent of men.

The pandemic had a greater impact on less educated workers (both men and women). Thirty-five percent of those with a primary education or less lost their job during the pandemic, as did 28 percent of employees with a secondary education. Approximately 19 percent of individuals with a tertiary education became unemployed.

Survey data revealed that as a consequence of labor market setbacks, just over half of the households in the region have not yet managed to recover their pre-pandemic income levels. This situation occurred despite government efforts to help families through direct transfer programs and other benefits. Approximately 38 percent of survey respondents had received emergency cash transfers.

The survey demonstrated that food insecurity still affects 23.9 percent of households in Latin America and the Caribbean. This figure is almost double that reported by households prior to the pandemic — 12.8 percent. However, most countries have improved in this area with respect to the levels observed in June 2020.

Results also demonstrated that more than a year after the onset of the crisis, 86 percent of school-age children and youth receive some type of education (face-to-face or remote). However, figures vary widely across countries: in Guyana and Guatemala, it is 64 percent while in Peru and Chile, it reaches 95 and 97 percent, respectively. Additionally, education coverage falls below pre-pandemic levels in the countries surveyed. Just under a quarter of students in the region attended face-to-face classes.

Access to health services improved significantly. However, the percentage of unvaccinated people remains high in some countries. Eight percent of the regional population has not been vaccinated or is not willing to receive a vaccine. This percentage is especially high in the Caribbean: 60 percent in Haiti, 49 percent in Jamaica and 43 percent in Saint Lucia and Dominica.

Finally, according to the survey results, the use of mobile banking and online transactions (e-commerce) rose sharply during the pandemic. The use of digital payments also increased — currently, 26 percent of survey respondents said they used mobile wallets. The highest increases were among the rural population, the population over age 55 and those with low levels of education (primary or less).

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Gender-based violence in Bangladesh: Economic Implications

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Violence against women is one of the most heinous crimes perpetrated in today’s   world. However, despite the gravity of the violence perpetrated against women, it is still the pervading reality in the world. Bangladesh is also afflicted with this malaise of violence against women which is manifested in the deluge of news across the media about the violence against women in various  form .While Bangladesh has made commendable strides in the economic front, the  perennial subjugation of the women who account  for virtually half of its population remains a hurdle. Against this backdrop, this article investigates the economic toll incurred to the economy owing to the entrenched culture of systemic violence in our country.

Women constitute nearly half of the population of Bangladesh. As such, their innate potentials have considerable bearing on the socio-economic progress of the country. Admittedly, advancement of a country in socio-cultural indicators presupposes the simultaneous improvement of  women from the subjugated position culturally attributed to them. It is impossible  to envisage a prosperous thriving economy without the contribution and participation of the women equally. Therefore, the lack of women’s participation commensurate with their capabilities   hinders the development of the country.

One of the obstacles women confront in their journey of transforming into human capital is perhaps the retrograde views that society harbor about the traditional gender role of the women which fetter their contribution to the economy and society by bestowing them only  the  circumscribed role of  looking after the domestic affairs and rearing and educating child. The pastoral as well as urban culture   perpetuate these traditional gender roles and deny women a free rein over their fate. Whenever  women   disavow the preordained and predictable roles  provided by the society, they  have  to face mounting pressure from society so as to conform to the prevailing norms .Failing to  conform to the  regressive gender role will spell grave consequences for the women .When the society fails to cower the woman with the threats that are at its disposal ,it resort to the egregious path of violence. While   violence against women is one of the most reprehensible crime one can ever commit, it however is normalized through a power dynamics that  reinforces the overbearing male role and relegate women to the subjugation. Therefore, the culture of violence against women isn’t anomalous rather is embedded in the prevailing  patriarchal power dynamics which deem chastising women for their  rebellious attitude is solicited and  invoke often contrived and distorted religious edicts in order to legitimize their deplorable crime. Moreover, the culture of violence against women which has been  aptly termed as a epidemic by the United Nations  is rooted in the prevailing socio-economic  structure of the country that  systematically condone the browbeating of women into submission to patriarchal  norms and wield violent measures when the woman stubbornly gainsay their patriarchal hegemony.

While the social, cultural and health toll of the violence perpetrated against women is undoubtedly strenuous, the economic losses incurred by the violence and the opportunities nipped in the bud owing to violence against women also need to be taken into account in order to the adequately discern the deleterious ramifications of the violence against women .However, despite profound economic toll that are inflicted due to the violence against women, it is still unaddressed in the economic literature worldwide and discussion and cognizance about this momentous issue and its economic implications still scant.

As has been mentioned earlier, women constitute the lynchpin of the economy of Bangladesh which has been adequately manifested in the participation of women in Bangladesh’s much-heralded RMG sector and other productive sectors. However, this success of the economy   overshadows the plight and perils  this working class women confront in their bid to become economically productive. The violence against women is systemically entrenched in the country and women’s engagement in the economic activities are frowned upon by the society and culture .Therefore ,the this patriarchal fetter women behind the door of their  houses  and worst women are inflicted  physical and mental violence in event of questioning the dictates of the elders and the male custodians. Therefore , the fundamental impact of violence against women on the economy of the country related to the untapped opportunities due to the constrains imposed by the patriarchal society on women under the pretext of social, religious and cultural norm. This threat alone or normalization of the gender role of the women as a care-giver hinder women in taking part in the economy on a par with their male counterparts  .

Beside the lost  opportunities that can be tapped, the violence against women has numerous other implications on the economy. Firstly, the violence against women inevitably  results in the physical damage and mental trauma of the victim which has enduring toll on her. Therefore ,violence against women translate to toll on the health of the victim and therefore the cost incurred on the victim due to medical fees  as a result of the violence is also included in the economic cost of violence against women. Secondly, the violence against women also leads to diminished productivity of the victim due to the health hazards. Therefore, violence against women has implicit economic cost on the economy as a result of the lost productivity.

Thirdly,the cycle of the violence against women negatively sensitize women in not challenging the sacrosanct patriarchal norms and therefore women fit themselves with the prevailing adverse society and they themselves reproduce and reinforce these norms .Therefore, a vicious cycle set in which prevents women to actualize their potential and stymie them in their path of realizing their goal .This result a sense of apathy in women with regards to education and other means of social mobility and they deliberately avoid the economically productive activities that are deemed taboo by the prevailing social norms and cultural ethos.

Moreover, violence against women is an egregious form of crime perpetrated by a   patriarchal agent while the society has entrenched roles, norms and ethos that condone and encourage such outrageous violence .Moreover, a vicious cycle is at play in the gender based violence. The economic repercussions of the violence committed against women is considerable. Violence against women hinder the development  of the women commensurate with their inherent potential which nip the dreams of women in the bud. Besides, gender based violence also deter women in challenging the prevailing patriarchal norms and undertaking productive economic activities that are frowned by the patriarchal society and are deemed taboo. Moreover, a widespread sensitization in societal level as well as a drastic  overhaul of the patriarchal structure is necessary in order to avert the adverse socio-economic consequences of gender-based violence and extirpate the heinous root of this deplorable crime.

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Omicron Variant: Implications on Global Economy

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The prolonged battering of the Covid-19 has been considerably hitting the world economy. While vaccination and a receding in the cases of the cases in virus transmission has provided   brief respite to   the countries that are grappling with the recurring surge of the virus, the resurfacing of another virulent   mutation termed as  Omicron sounds ominous for the future of the world economy .Against this backdrop, this article projects the plausible economic ramifications of the new strand of the virus on the global economy.

The economic downward trajectory occasioned by the Covid-19 has been unprecedented in recent global history. While the economic depression of 2007-08 proved disastrous for the world economy, the toll   emanating from Covid-19 pandemic and consequent   economic stagnation has surpassed all the previous   economic plunge .In fact, some analysts have gone to the extent of   comparing the Covid-19 induced economic depression with the great depression of the 1920s.However, whether the far reaching repercussions of the Covid-19 on the global economy will be as momentous is still remains to be seen. Nevertheless, the   profound   economic jolt triggered by the Covid-19 pandemic is poised to reverberate across the world through shaping socio-economic and political events

The scar inflicted by a protracted economic recession owing to Covid-19 is apparent in the arduous path of economic rejuvenation in the western countries and eastern countries alike. Virtually every country is grappling with the toll that Covid-19 has incurred in the economy. The western countries are finding it   difficult to retrieve the losses that Covid-19 has precipitated. Although the swift vaccination of the western countries at the expense of the developing countries has provided a fleeting lull in their battle against Covid-19,it seem however the virus has resurfaced with increasing virulence in order to offset whatever gain these embattled countries managed to garner in their fight against Covid-19.

The skyrocketing and unprecedented inflation of the western countries coupled with a plummeted consumer confidence has meant a prolonged period of stagnation of their economies. However, in the wake of vaccination induced temporary respite in the viral cases, the economies rebounded strongly from the pits of economic recession. However, these hard-earned   gains will be reversed in the event of the advent of any new strand of the virus. Already, the delta variant which originated in India had triggered a spate of Covid-19 flare-ups in the United   States and United Kingdom. Against this backdrop, the Omicron variant is set to aggravate the   economic woes of the western countries and in turn the world.

While the western countries are reeling from economic stagnation, the developing and underdeveloped countries are confronting many abysmal realities due to their prevailing economic backwardness. Their economic plight has been lingering in want of adequate vaccination due to the apathetic stance of the western countries and global governance institutions .Therefore, while the western countries has rebounded from the Covid-19 induces economic predicaments, the difficulties confronted by the developing countries has continued unabated. While the influence of advanced countries and their less advanced counterparts in world-economy is inextricably tied, the callous attitude of the developed countries to the vaccination of countries in Asia and South Asia turn out to   be sheer lack of economic prudence.

While western countries are considered as the economic hub of the world, it is however the developing countries on which the vital supply chains of the world economy hinges on. Therefore, the tardy pace of vaccination in these countries is prejudicial to the global economic stability. The economic ramification of the slow pace of vaccination is twofold for the world economy. Firstly, the slow vaccination hinders the revival of the economic activities in the developing countries thereby obstructing the supply chain of the commodities .This supply chain crisis has ripple effect in the western economies. The recent predicament of inflation and attending macroeconomic woes in countries like the United States and United Kingdom is manifestation of the supply chain crisis plaguing the world economy. Due to the paucity of commodities and raw materials, the prices of necessary goods has escalated in the western countries which has plummeted consumer confidence and triggered a vicious cycle of stagflation in the economy that is reminiscent of the 1970s when a similar crisis in oil supply has  precipitated economic downturn in the western economies.

Secondly, the slow rate of vaccination also run the risk of allowing the virus to mutating to newer and much virulent variants and due to the unfettered communication as a result of globalization the emergence of any new variant doesn’t remain in the confines of any border rather proliferate like wildfire and precipitate global crisis. Therefore, the lack of vaccination or slack pace therefore has global repercussions. Therefore, it is judicious of the developed countries to concentrate efforts in contributing to the vaccination of the less developed countries which will yield good results for their economy.

The ubiquitous mechanism in battling Covid-19 remains one of containment that entails halting economic and other activities and insulating the countries from other countries through imposing border controls, curbs on air communication and other stringent measures echoing protectionist attitude. However, these measures are antithetical to the spirit of the globalization and global trade. While lockdowns and other protectionist measures yield temporary improvement in the Covid  cases, it is not viable in the longer term. Besides, lockdowns have deleterious ramifications on the economy and further aggravate economic rebounding of the developed countries and developing countries alike. Therefore, efforts should be aimed at preventing the Covid cases rather than grappling with the Covid with a knee-jerk policy of improvisation. .

Moreover,Covid-19 has already occasioned far-reaching economic fallout in the world economy. Indications abound regarding the fact that the world economy is verging on profound and prolonged recession. Against the backdrop of ominous predictions and slackening growth and painful inflation of the world economy, the prospects of the world economy due the advent of a new variant remain mired in obscurity. It can be concluded that the economic repercussions of yet another novel variant will be momentous and will offset hard-earned growth of the countries .Unlike previous precedent of haphazard policy and knee-jerk policy solutions, this time around the countries need to undertake challenge much prudently and should concentrate all of their efforts aiming at universal vaccination of all countries so as to prevent the resurfacing of similar virulent viral strands.

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