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Venezuelan Migration Could Raise GDP Growth in Ecuador by Up to 2 Percent

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A recent study led by the World Bank estimates that Venezuelan migrants and refugees in Ecuador, most of them highly educated young people, could raise the country’s GDP by up to 2 percent if they have access to jobs and income corresponding to their educational level.

Challenges and Opportunities of Venezuelan Migration in Ecuador is a study carried out in collaboration with six United Nations agencies. The report analyzes the situation of the Venezuelan migrant population and of the recipient communities. It includes relevant information for public policies and cooperation activities based on recent evidence, as well as for the definition of financing and humanitarian aid to complement the efforts of the Ecuadorian government.

The situation in Venezuela has triggered an unprecedented exodus in South America. To date, more than 400,000 Venezuelans have fled to Ecuador. The country has received the third largest share of this migratory flow after Colombia and Peru. This influx occurred during a challenging period for Ecuador due to economic difficulties, which have been exacerbated by falling oil prices and the impact of the COVID-19 pandemic.

According to the study, the majority of the Venezuelans interviewed had completed secondary school and many have some higher education, especially the women. If this population could obtain jobs commensurate with their educational level, they could generate revenue totaling between 1.6 and 1.9 percent of the country’s GDP.

The study also identified the main constraints to making this a reality: obtaining legal migratory status and the documents needed to certify the studies completed. According to the quantitative and qualitative analyses carried out for this study, just 15 percent of the Venezuelan population of working age interviewed had legal migratory status. Nevertheless, 65 percent have some type of job. Four in 10 Venezuelans in Ecuador were victims of discrimination – mainly due to their nationality – during the report data collection and preparation period.

Another key challenge is school enrolment: over 50 percent of school-aged migrants and refugees do not attend school, mainly because of the costs involved, such as for materials or transportation, and because of the lack of identification documents.

“The World Bank recognizes the efforts of the Government of Ecuador to address the economic challenges and at the same time the difficulties involved in the sustained flow of a large number of immigrants,” said Juan Carlos Alvarez, resident representative of the World Bank in Ecuador. “We believe that this study can serve as additional input for decision-making and public policy development to increase the wellbeing of the Ecuadorian and Venezuelan population. It can also serve to inform the support of international cooperation agencies, such the recent assistance that the government received from the member states of the Global Concessional Financing Facility (GCFF).”

More than half — 57 percent — of Venezuelans in Ecuador work informally, while 71 percent have temporary employment contracts. According to the report, Venezuelan migrants work five more hours per week than their Ecuadorian peers yet receive 42 percent less pay for the same work.

Bureaucratic procedures and the lack of documentation are the main constraints to legalizing their migratory status and participating formally in the labor market. Women are more vulnerable to job discrimination and their access to employment is limited by childcare duties given that more than half of Venezuelan children and adolescents in Ecuador do not attend school.

Due to the COVID-19 pandemic in Ecuador, in seven of every 10 households of the migrant and refugee Venezuelan population, there is an adult who has “skipped a meal,” in other words, who did not have breakfast, lunch or dinner. Additionally, in recent months, in half of the Venezuelan households interviewed, at least one of their members has become unemployed.

“Ecuador’s economic and social situation, coupled with the COVID-19 crisis, mainly affects the country’s most vulnerable populations. It has an impact on Venezuelan populations, but also on the communities that receive them. Therefore, developing protection and social inclusion alternatives requires the efforts and commitment of everyone: the government, civil society, the private sector and the international community,” said Sergio Olivieri, a World Bank senior economist and one of the report’s authors.

The study, Challenges and Opportunities of Venezuelan Migration in Ecuador, was requested by the Government of Ecuador to analyze the fiscal impact of the migratory flow occurring since 2018. To this end, the World Bank worked with different Ecuadorian government and United Nations agencies, using interviews, focus groups, administrative records and innovative mechanisms such as big data. This report is part of a World Bank research series on Venezuelan migration in Latin America. Previously, the organization published studies on Colombia (2018) and Peru (2019).

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MDBs’ Annual Climate Finance Passes $61 Billion

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Climate financing by seven of the world’s largest multilateral development banks (MDBs) totaled $61.6 billion in 2019, with $41.5 billion (67%) in low- and middle-income economies, according to the 2019 Joint Report on Multilateral Development Banks’ Climate Finance.

In addition to its traditional focus on low- and middle-income countries, the 2019 report expands the scope of reporting for the first time to all countries of operations.

Some $46.6 billion, or 76% of total financing for the year, was devoted to climate change mitigation investments that aim to reduce harmful greenhouse gas emissions and slow down global warming.

The remaining $15 billion, or 24%, was invested in adaptation efforts to help countries build resilience to the mounting impacts of climate change, including worsening droughts and more extreme weather events from extreme flooding to rising sea levels.

The report combines data from the Asian Development Bank (ADB), the African Development Bank, the European Bank for Reconstruction and Development, the European Investment Bank, the Inter-American Development Bank Group, the World Bank Group and—for the first time—the Islamic Development Bank, which joined the working group in October 2017. In 2019, the Asian Infrastructure Investment Bank also joined MDB working groups, and its data is presented separately in the report.

Additional climate funds channeled through MDBs—such as from the Climate Investment Funds, the Global Environment Facility Trust Fund, the Global Energy Efficiency and Renewable Energy Fund, the European Union’s Funds for Climate Action, and the Green Climate Fund—also play an important role in boosting MDB climate financing. In 2019, the MDBs reported a further $102.7 billion in net climate cofinancing from public and private sources. This raised the total climate activity financed by MDBs in 2019 to $164.3 billion.

“The growing flow of MDB climate finance shows our joint resolve to take on climate change and, in the face of the coronavirus disease (COVID-19) pandemic, it is more important than ever to ‘build back better’ in a low carbon and climate resilient way,” said the Director General of ADB’s Sustainable Development and Climate Change Department Woochong Um. “The report shows that climate finance provided by and through the MDBs is providing increasing support for these needed transitions.”

In 2019, ADB committed almost $7.1 billion in climate finance (more than $5.5 billion for mitigation and $1.5 billion for adaptation). This included $705 million from external resources, including multilateral climate funds. Further, ADB mobilized $8.8 billion of climate cofinancing.

The report shows that the MDBs are on track to deliver on their increased climate finance commitments. In 2019, the MDBs committed their global annual climate financing to reach $65 billion by 2025—with $50 billion for low- and middle-income countries—and that MDB adaptation finance would double to $18 billion by 2025. The MDBs have reported on climate finance since 2011, based on a jointly developed methodology for climate finance tracking.

The 2019 Joint Report on Multilateral Development Banks’ Climate Finance is published in the midst of the COVID-19 pandemic, which has caused significant social and economic disruption, temporarily reducing global carbon emissions to 2006 levels.

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Public Transport Can Bounce Back from COVID-19 with New and Green Technology

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Public transport must adapt to a “new normal” in the wake of the coronavirus disease (COVID-19) pandemic and adopt technologies that will render it more green and resilient to future disasters, according to a new report by the Asian Development Bank (ADB).

The report, Guidance Note on COVID-19 and Transport in Asia and the Pacific, details the profound impact of the pandemic on transport, as swift lockdowns forced millions this year to work from home overnight, schools to shift to e-learning, and consumers to flock to online shopping and food delivery.

While public transit may have been previously perceived as a mostly green, efficient, and affordable mode of travel, initial trends in cities that have re-opened have indicated that public transit is still considered to be relatively unsafe and is not bouncing back as quickly as the use of private vehicles, cycling, and walking.

“The two key challenges ahead are addressing capacity on public transport to maintain safe distancing requirements, and how best to regain public confidence to return to public transport,” said Bambang Susantono, ADB Vice-President for Knowledge Management and Sustainable Development. “In the short term, more effort is needed to reassure public transport users of safety and demonstrate clean and safe public transport. In the longer term, technological advances, big data, artificial intelligence, digitalization, automation, renewables and electric power can potentially offer fresh innovations to tackle changing needs, giving rise to smarter cities.”

While drastic lockdown measures around the world have brought world economies to their knees, satellites have recorded data on how the concentrations of CO2 and air pollutants have fallen drastically, bringing clear blue skies to many cities.

But as cities have reopened, traffic levels have increased. For example, Beijing traffic levels, by early April 2020, exceeded the same period in 2019. If this trend is seen on a wide scale, it could set back decades of effort in promoting sustainable development and more efficient means of urban mobility.

The report says there is a short window of opportunity for cities to promote the adoption of low-carbon alternatives to lock-in the improved air quality conditions gained during the peak of the pandemic lockdown. Public transport can play an important role through more active promotion of clean vehicles, provision of quality travel alternatives in public transport, and a better environment for non-motorized modes such as walking and cycling to enhance overall health and wellbeing.

The confidence of passengers on public transport should be restored through protective measures such as cleaning, thermal scanning, tracking and face covering, the report says. Further study to explore how protective and preventive measures can be stepped up to allow relaxation of safe distancing requirements would help mitigate capacity challenges. A possible future trend may be consolidation of services and rationalization of routes to better serve the emerging travel demand patterns and practices.

As countries enter the “recovery” phase, further preventive and precautionary operating measures and advanced technology should be implemented to enable contactless processes and facilitate an agile response. Demand management measures can facilitate crowd control in public transport systems and airports. As a complementary measure, non-motorized transport capacity could be expanded to absorb spillover demand from public transport.

Since mass public transport is the lifeblood of most economies, government policies and financial support are essential during this period, to enable public transport operators to stay viable and continue to support the movement of passengers and goods in a sustainable way.

For ADB, which committed last year $7 billion to the transport sector, behavioral trends linked to COVID-19 may require a review of the short-term viability of passenger transport and operational performance to meet changing demand for public transit systems. “Regardless of the COVID-19 pandemic it is clear that developing Asia will continue to have a large need for additional transport infrastructure and services,” the report concludes. “It would take several years before the projects currently in the pipeline would be operational and much can happen during these years.”

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Zero emission economy will lead to 15 million new jobs by 2030 in Latin America and Caribbean

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In a new groundbreaking study , the Inter-American Development Bank (IDB) and the International Labour Organization (ILO) show that the transition to a net-zero emission economy could create 15 million net new jobs in Latin America and the Caribbean by 2030. To support a sustainable recovery from the COVID-19 pandemic , the region urgently needs to create decent jobs and build a more sustainable and inclusive future.

The report finds that the transition to a net-zero carbon economy would end 7.5 million jobs in fossil fuel electricity, fossil fuel extraction, and animal-based food production. However, these lost jobs are more than compensated for new employment opportunities: 22.5 million jobs are created in agriculture and plant-based food production, renewable electricity, forestry, construction, and manufacturing.

The report is also the first of its kind to highlight how shifting to healthier and more sustainable diets, which reduce meat and dairy consumption while increasing plant-based foods, would create jobs and reduce pressure on the region’s unique biodiversity. With this shift, LAC’s agri-food sector could expand the creation of 19 million full-time equivalent jobs despite 4.3 million fewer jobs in livestock, poultry, dairy and fishing.

Moreover, the report offers a blueprint on how countries can create decent jobs and transition to net-zero emissions. This includes policies facilitating the reallocation of workers, advance decent work in rural areas, offer new business models, enhance social protection and support to displaced, enterprises, communities and workers.

Social dialogue between the private sector, trade unions, and governments is essential to design long-term strategies to achieve net-zero emissions, which creates jobs, helps to reduce inequality and delivers on the Sustainable Development Goals .

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