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Decisive Action and Change Needed to Reform and Rebuild a Better Lebanon

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A new damage and needs assessment following the August 4 explosion that rocked the city of Beirut calls for building back a better Lebanon based on the principles of transparency, inclusion and accountability to meet the demands and aspirations of the Lebanese people.

To help guide the urgently needed global response, the World Bank Group (WBG), in cooperation with the United Nations (UN) and the European Union (EU) conducted a Rapid Damage and Needs Assessment (RDNA), in close partnership with Lebanese ministries, civil society organizations and other key stakeholders.

According to the RDNA’s preliminary estimates, the explosion caused between US$3.8 and US$4.6 billion in damage to physical stock, while losses including changes in economic flows as a result of the decline in the output of the economic sectors are estimated to be in the range of US$2.9 and US$3.5 billion. The most severely affected sectors are housing, transport and tangible and intangible cultural assets (including religious and archeological sites, national monuments, theaters, archives, libraries, monuments).

Public sector reconstruction and recovery needs for this year and the next are estimated in the range of US$1.8 and US$2.2 billion, with between US$605 and US$760 million needed in the immediate term until December 2020, and between US$1.18 and US$1.46 billion in the short term for the year 2021. The transport sector’s needs are the highest, followed by culture and housing.

Although its estimates are preliminary due to the rapid nature of the assessment that was carried out together in cooperation with partners under challenging circumstances, the RDNA lays the groundwork for an agenda for reform, recovery, and reconstruction that inspires hope for a better future for all Lebanese, and where the Lebanese people should have a leading role.

The three main economic effects of the explosion are: losses in economic activity caused by the destruction of physical capital; trade disruptions; and losses in fiscal revenues for the Government. Even prior to the explosion, Lebanon was facing compounded crises with pre-explosion projections of 2020 real GDP growth well into the negative double digits, driven by the spillovers from the Syria conflict, whereby

Lebanon continues to host the largest refugee per capita population in the world; a financial and economic crisis that includes an impaired financial sector, a currency crisis, very high inflation rates, a defaulting public sector; and the effects of the COVID-19 pandemic. The disaster will not only exacerbate the contraction in economic activity, but also worsen poverty rates, which were already at 45 percent of the population just prior to the explosion.

Critical recovery needs in the next 3 months alone include an estimated US$35 to US$40 million for an immediate large-scale cash transfer to meet the basic needs of 90,000 affected individuals, and to create short-term jobs for 15,000 individuals. They also include provision of shelter for the most vulnerable displaced, low income, and middle-income households; repair of minimally and partially damaged housing for the lower income households. Immediate housing needs are estimated at between US$ 30 and US$35 million, while short-term needs for the year 2021 at between US$190 and US$230 million. In addition, US$225 to US$275 million in financial support is needed immediately to restore services of 5,200 micro firms and 4,800 small businesses that employ thousands of Lebanese. These small business recovery grants and soft loans will cover reconstruction, equipment and working capital needs to reopen activities and retain workforce.

Reconstruction efforts will require not only the rehabilitation and reconstruction of damaged buildings and infrastructure, but also the rebuilding of institutions and governance structures. In the port sector for instance, the report recommends that, beyond the emergency works needed to ensure Lebanon’s vital imports, the port is rebuilt in a holistic and modern way, better sited and sized, and governed by the most efficient and transparent practices.

The RDNA recommends a “Building Back Better” approach through a framework of Reform, Recovery and Reconstruction combining interventions that prioritizes the needs of the people, particularly the poor and most vulnerable, with structural reforms relating to macroeconomic stabilization, governance, private sector operating environment, and ensuring human security. These reforms should prevent corruption and elite capture.

Given Lebanon’s state of insolvency and lack of sufficient foreign exchange reserves, international aid and private investment will be essential for comprehensive recovery and reconstruction. Lebanon’s implementation of a credible reform agenda will be key to accessing international development assistance and to unlock external and private sector sources of financing.

The World Bank, the United Nations and the European Union are fully committed to working together with Lebanon and its people to build back a better Lebanon that puts its people’s needs first.

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Human Rights

Shining a light on sexually exploited women and girls forced into crime

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Trafficked and sexually exploited woman and girls can find themselves facing prosecution and conviction for those very same crimes, in some countries, a new UN report shows. The study aims to help prosecutors to better handle these complex cases, and protect the genuine victims.

No clear-cut cases

A 2017 criminal case in Canada, to take one example from the report, involved an 18-year-old woman defendant was charged with the forced prostitution of two female minors, aged 14 and 16. She had instructed one of them on how to dress, and what to do with clients, and taken away the cell phone of the other, to prevent her from escaping.

She was found guilty and sentenced to eight months in prison. However, it was revealed during the case that she too was a victim of sexual exploitation. The court heard that she was under the control of a male trafficker, and had been exploited from the age of 16, and physically abused by pimps.

The case, which is included in Female Victims Of Trafficking For Sexual Exploitation As Defendants, a new publication from the UN Office on Drugs and Crime (UNODC), shows the complexity of many human-trafficking-related cases, in which the defendant may also be a victim, who either had no alternative but to obey an order, and commit a crime, or hoped to limit their own exploitation or escape poverty by playing a role in the crime. The study also found that traffickers use the women and girls as a shield to protect themselves from being punished for their crimes.

Punished twice

 “Ever since UNODC started collecting statistics on human trafficking 15 years ago, women and girls have consistently represented the majority of reported victims”, says Zoi Sakelliadou, a UNODC Crime Prevention and Criminal Justice Officer, who coordinated the development of the study. 

“We’ve also seen that the percentage of female perpetrators of trafficking who are at the same time victims of this crime, is steadily high too, especially if compared to female offenders in other crimes. The traffickers not only earned a profit by sexually exploiting the victims, but then made them commit crimes so they could escape liability and prosecution”.

The report shows that traffickers deliberately used the “victim-defendants” in low-level roles, that exposed them to law enforcement authorities – meaning they were more likely to get caught.

These roles included the recruitment of new victims, collecting proceeds, imposing punishments, or posting advertisements for victims’ sexual services.

In very few of the examined cases did the victims engage in acts of trafficking in an attempt to move up the hierarchy of the criminal organization or for financial gain.

It was not just the statistics that led UNODC to analyse this topic, explains Ms. Sakelliadou, but also calls from law enforcement and criminal justice officials, who stressed the complexity of investigating and adjudicating cases that involve female victims of trafficking as alleged perpetrators. 

The study also highlights the clear links between human trafficking and violence against women, domestic violence, and the role of intimate partner violence.  

“We found that in around a quarter of the cases examined, the women had been subjected to multiple forms of violence prior to and during the trafficking process, including from early childhood”, says Ms. Sakelliadou. “We hope this study will support the law enforcement and criminal justice officials and the NGOs who handle these complex cases and support the victims.”

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Development

Calls for Collaboration and Rebuilding Trust Set Tone for The Davos Agenda

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Setting the tone for the meeting, the key themes of the first day of the World Economic Forum Davos Agenda 2021 proved to be “trust”, “solidarity”, “respect”, “transparency” and “collaboration”.

Chinese President Xi Jinping, making the first special address of the event, called for both greater global efforts in the fight against an unprecedented public health crisis and a renewed commitment to multilateral cooperation.

António Guterres, Secretary-General of the United Nations, set out his priorities for an inclusive and sustainable recovery from the pandemic. In a wide-ranging address, he asserted that vaccines – “people’s vaccines” – should be regarded as a public good, pressed developed nations to offer their poorer counterparts debt relief because “no country should be forced to choose between basic services and serving debt”, and called for increased fairness in the world of work.

He made a call for a “truly global coalition for carbon neutrality” and suggested the need for adaptation, renewed confidence and a need to drastically change policy. He pressed business to operate “in line with the Paris Agreement”, called on asset managers to “decarbonize their portfolios” and asked all businesses to “align with the UN Global Compact”. In addition, Guterres announced the need for a new social contract, one “between governments, peoples, civil society, businesses and more, integrating employment, sustainable development, social protection, and based on equal rights and opportunities for all”.

Collaboration was the overriding message that came from Anthony Fauci, Director at National Institute of Allergy and Infectious Diseases (NIAID), and other participants discussing how to respond to the COVID-19 pandemic and future such outbreaks. Fauci reflected on how divisiveness had hobbled the US approach to the disease, saying: “When public health issues become politically charged – like wearing a mask or not becomes a political statement – you can’t imagine how destructive that is to any unified public health message.”

He called on China to provide the World Health Organization (WHO) with information about the origin of COVID-19, arguing that without it, scientists and doctors faced a “big black box”. He also registered the US’s renewed support for the WHO and said that with reform, it will become the multilateral organization that deals with disease preparedness. His overall message, however, was one of the need for greater global health security, transparency, collaboration and solidarity, without which he announced “it becomes extremely problematic to address an outbreak”.

In other sessions during the day, President of the European Central Bank Christine Lagarde said economic recovery in 2021 will progress in two phases. In the first, there will be a high level of uncertainty as vaccines are produced and rolled out, and lockdown measures may become more stringent because of the emerging COVID-19 variants. She described it as “crossing the bridge to recovery, but the journey is delayed, not derailed”.

The second phase is where the economy is reopening, something that will bring its own challenges and positive developments. As part of the recovery, Lagarde underlined the need to bring more women to the table to help the recovery, saying: “Progress can be made and women can do the job just as well as men.”

Also considering a two-pronged approach was Bruno Le Maire, Minister of the Economy, Finance and the Recovery of France, who argued that while pursuing a policy of fiscal support during the pandemic, nations should also consider the future. “We have to think about the kind of economy we want to build; we want to build a sustainable economy and reduce the inequalities,” he said. Le Maire also called on states to learn lessons from each other during the crisis. As he pointed out, for the first time in its history, the member states of the Eurozone have all taken the same measures.

Peter Altmaier, Federal Minister for Economic Affairs and Energy of Germany, said that there needs to be greater reliance on open markets and multilateralism. In the post-COVID-19 recovery, he sees opportunities for synergies, such as greater investment in clean energy solutions to help tackle climate change.

Speaking about his new book, Stakeholder Capitalism, Schwab said the pandemic has shown that companies that commit to stakeholder capitalism perform much better than others because they invest in the long-term viability of the company. He called for a much wider definition of capital, one that includes “human, social and natural capital” because all those aspects of capital combine to create wealth and prosperity.

Underlining the day’s theme – Designing cohesive, sustainable and resilient economic systems – the meeting saw the launch of the Partnering for Racial Justice in Business initiative, which sees a coalition of almost 50 organizations committed to improving racial and ethnic justice in the workplace. The Forum released a report revealing that upskilling has the potential to boost GDP by $6.5 trillion by 2030. Also covered during the day were topics ranging from gender parity and restoring economic growth to addressing mental health in the workplace, building crisis-resistant healthcare systems and creating a new social contract.

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Finance

COVID’s led to ‘massive’ income and productivity losses

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Job losses or reduced working hours due to the impact of the COVID-19 pandemic cost the world the equivalent of 255 million jobs in 2020, the UN International Labour Organization (ILO) said on Monday, noting that the “massive impact” was nearly four times the number lost during the 2009 global financial crisis. 

According to the ILO Monitor: COVID-19 and the world of work, the losses resulted in an 8.3 per cent decline in global income, before factoring in support measures, equivalent to $3.7 trillion or 4.4 per cent of global gross domestic product (GDP). 

Recovery scenarios 

While there is still a high degree of uncertainty for 2021, the ILO estimates projected that most countries could see a relatively strong recovery in the second half the year, as COVID-19 vaccination programmes take effect. 

ILO put forward three scenarios: a baseline estimate showing a 3 per cent decline; a pessimistic forecast indicating a 4.6 per cent loss, and in the most optimistic scenario, a 1.3 per cent decrease in working hours through this year. 

“The signs of recovery we see are encouraging, but they are fragile and highly uncertain, and we must remember that no country or group can recover alone”, Guy Ryder, ILO Director-General said

“We are at a fork in the road. One path leads to an uneven, unsustainable, recovery with growing inequality and instability, and the prospect of more crises. The other focuses on a human-centred recovery for building back better, prioritizing employment, income and social protection, workers’ rights and social dialogue”, he added. 

“If we want a lasting, sustainable and inclusive recovery, this is the path policy-makers must commit to.” 

Women and children most vulnerable 

In terms of sectors and groups, women were more affected than men, as were younger workers, ILO said. 

“Globally, employment losses for women stand at 5 per cent, versus 3.9 per cent for men. In particular, women were much more likely than men to drop out of the labour market and become inactive”, it added. 

Similarly, younger workers either lost jobs, dropped out of the labour force, or delayed entry into it.  

‘Lost generation’ risk 

“The employment loss among youth (15-24 years old) stood at 8.7 per cent, compared to 3.7 per cent for adults. This highlights the all too real risk of a lost generation” according to ILO. 

Accommodation and food services was the worst hit sector, where employment declined by over 20 per cent, on average, followed by retail and manufacturing.  

In contrast, the information, communication, finance and insurance sectors, grew in the second and third quarters of 2020. Marginal increases were also seen in mining, quarrying and utilities. 

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