The devastating losses in working hours caused by the COVID-19 pandemic have brought a “massive” drop in labour income for workers around the world, says the International Labour Organization (ILO) in its latest assessment of the effects of the pandemic on the world of work.
Global labour income is estimated to have declined by 10.7 per cent, or US$ 3.5 trillion, in the first three quarters of 2020, compared with the same period in 2019. This figure excludes income support provided through government measures.
The biggest drop was in lower-middle income countries, where the labour income losses reached 15.1 per cent, with the Americas the hardest hit region at 12.1 per cent.
The ILO Monitor: COVID-19 and the world of work. Sixth edition , says that the global working hour losses in the first nine months of 2020 have been “considerably larger” than estimated in the previous edition of the Monitor (issued on 30 June).
For example, the revised estimate of global working time lost in the second quarter (Q2) of this year (when compared to Q4 2019) is for 17.3 per cent, equivalent to 495 million full time equivalent (FTE) jobs (based on a 48-hour working week), whereas the earlier estimate was for 14 per cent, or 400 million FTE jobs. In Q3 of 2020, global working hour losses of 12.1 per cent (345 million FTE jobs) are expected.
The outlook for Q4 has worsened significantly since the last ILO Monitor was issued. Under the ILO’s baseline scenario, global working-hour losses are now projected to amount to 8.6 per cent in the fourth quarter of 2020 (compared to Q4 2019), which corresponds to 245 million FTE jobs. This is an increase from the ILO’s previous estimate of 4.9 per cent or 140 million FTE jobs.
One reason for the estimated increases in working-hour losses is that workers in developing and emerging economies, especially those in informal employment, have been much more affected than by past crises, the Monitor says.
It also notes that the drop in employment is more attributable to inactivity than to unemployment, with important policy implications.
While many stringent workplace closures have been relaxed, there are significant variations between regions. 94 per cent of workers are still in countries with some sort of workplace restrictions, and 32 per cent are in countries with closures for all but essential workplaces.
The “fiscal stimulus gap”
The 6th edition of the Monitor also looks at the effectiveness of fiscal stimulus in alleviating labour market impacts.
In countries where sufficient data is available for Q2 2020, a clear correlation exists, showing that the larger the fiscal stimulus (as a percentage of GDP), the lower the working-hour losses. In that period, globally an additional fiscal stimulus of 1 per cent of annual GDP would have reduced working hour losses by a further 0.8 per cent.
However, while fiscal stimulus packages have played a significant role in supporting economic activity and reducing the fall in working hours, they have been concentrated in high-income countries, as emerging and developing economies have limited capacity to finance such measures.
In order for developing countries to reach the same ratio of stimulus to working hours lost as in high-income countries, they would need to inject a further US$982 billion (US$45 billion in low-income countries and US$937 billion in lower-middle income countries). The stimulus gap for low income countries amounts to less than 1 per cent of the total value of the fiscal stimulus packages announced by high-income countries.
This huge “fiscal stimulus gap” is even more worrying in the light of the social protection deficits in many developing countries. Moreover, some of these countries have also had to redirect public spending from other objectives in order to mitigate the labour market impact of the crisis.
“Just as we need to redouble our efforts to beat the virus, so we need to act urgently and at scale to overcome its economic, social and employment impacts. That includes sustaining support for jobs, businesses and incomes,” said ILO Director-General Guy Ryder.
“As the United Nations General Assembly gathers in New York, there is pressing need for the international community to set out a global strategy for recovery through dialogue, cooperation and solidarity. No group, country or region can beat this crisis alone,” he concluded.
10 new cities chosen for World Economic Forum circular economy initiative
The World Economic Forum’s Scale360° initiative announced today the 10 city-based hubs joining its Circular Shapers programme.
Scale360° leverages innovation hubs in cities, countries and regions worldwide, bringing together leaders in science, policy and business to trigger circular change. Circular Shapers engage with local public, private, and civil society stakeholders to design, organise, and deliver circular economy projects tailored to local needs.
Circular Shapers are competitively selected from the Global Shapers Community, a network of committed and energized young volunteers in 448 city-based hubs around the world. These changemakers have the energy, skill, networks and commitment needed to transform their cities into centres of circular economy innovation.
The latest Circular Shaper cohort hails from four continents and includes: Ankara, Asuncion, Auckland, Beijing, Bucharest, Lahore, Manama, Milan, Morelia, and Thimphu.
The cities selected to the latest cohort will apply Scale360°’s tested methodology – the Scale360° Circular Innovation Playbook – to fast-track Fourth Industrial Revolution impact to keep more goods in use. Their initiatives will explore ways to apply circular design principles, improve reuse, and to eliminate waste, all while strengthening economies and boosting job growth.
These join the successful pilot cohort which included four Global Shapers hubs in Mexico City, Brussels, Turin and Bangkok and ran from February to July 2021.
In just a few months, those pilot cities built critical relationships with leaders in government, the private sector, and NGOs, making critical early steps towards driving circular innovation. Specific achievements include:
Bangkok: Mobilized a range of partners from researchers to advertising agencies to popularize solutions to air pollution and plastics. Solutions included: assembling a catalogue to help businesses choose alternatives to single-use plastics in food packaging and a social media campaign to build momentum for clean air regulation.
Brussels: Partnered with local NGOs on its “Eat, Play, Live Circular” initiatives to create bottom-up solutions for more circular lifestyles. Initiatives included an ‘Idea-thon’ for food and packaging waste solutions and a series of experiments with the public to make one Brussels public space more circular.
Mexico City: Trained public, private and government stakeholders in Scale360° methodology to bridge circular economy knowledge gaps and drive the circular transition through focusing early conversations.
Turin: Built critical relationships with stakeholders from 14 organizations including regional policy makers, members of the private sector, academia, and existing networks to help foster and support much-needed discussions and collaboration on circular needs and priorities.
The Circular Shapers tap into World Economic Forum networks of experts and leaders in civil society, government, industry global organizations, including the Platform for Accelerating Circular Economy (PACE).
“It’s powerful to see how Scale360° methodology has spread so rapidly and empowered Global Shapers to become leaders driving circular innovation in their cities. Now in 14 hubs around the world, Circular Shapers is one of the largest cross-hub collaborations in the Global Shapers Community,” said Katie Hoeflinger, Specialist, Climate and Environment, Global Shapers Community.
The United Arab Emirates, a key supporter of Scale360°’s approaches, agrees that these new hubs will play an important role in building circular innovation. “The UAE supports Scale360° in driving the transition to circular economy locally and globally,” said his Excellency Dr. Abdullah Belhaif Al Nuaimi, Minister of Climate Change and Environment. “This program will go a long way in fostering innovations that have the potential to fast-track the implementation of the circular economy principles around the world.”
These efforts can also fuel a just transition, noted Head of Global Opportunities for Sustainable Development Goals (GO4SDGs), United Nations Environment Programme (UNEP), Adriana Zacarias Farah. “Jobs and skills are central to getting the political buy-in for the transformation from linear to circular. UNEP through the initiative Global Opportunities for SDGS (GO4SDGS) is happy to collaborate with the Forum and Scale360° on circular cities and the just transition narrative.”
Building circular capabilities can help meet critical climate goals. “Scaling up circular business models and solutions is vital for environmental reasons and needs to happen fast,” said Carsten Gerhardt, Partner at Kearney and Founder at Circular Valley (leading partners of Scale360° Germany).
With new Circular Shaper hubs in place, momentum for circular innovation can build further. Added Scale360°’s Global Lead, Helen Burdett: “This latest cohort is another example of local action for global impact on the circular economy transition.”
World Bank Group’s $157 Billion Pandemic Surge Is Largest Crisis Response in Its History
In response to COVID-19 severely damaging the lives and livelihoods of millions of people in developing countries, the World Bank Group deployed over $157 billion to fight the pandemic’s health, economic, and social impacts over the last 15 months (April 1, 2020 – June 30, 2021). This is the largest crisis response of any such period in the Bank Group’s history and represents an increase of more than 60% over the 15-month period prior to the pandemic. Bank Group commitments and mobilizations in fiscal year 2021 (FY21) alone (July 1, 2020 – June 30, 2021) amounted to almost $110 billion (or $84 billion excluding mobilization, short-term financing, and recipient-executed trust funds).
Since the start of the pandemic, the Bank Group supported countries to address the health emergency, strengthen health systems, protect the poor and vulnerable, support businesses, create jobs and jump start a green, resilient, and inclusive recovery.
Following last year’s COVID-related economic deterioration, the global economy is expected to expand 5.6% in 2021. Thus far, the recovery is uneven and many of the world’s poorest countries are being left behind. While about 90% of advanced economies are expected to regain their pre-pandemic per capita income levels by 2022, only about one-third of emerging market and developing economies are projected to do the same. In 2020, global extreme poverty rose for the first time in over 20 years, with nearly 100 million people pushed into extreme poverty.
“Since the start of the pandemic, the World Bank Group has committed or mobilized a record $157 billion in new financing, an unprecedented level of support for an unprecedented crisis,” said World Bank Group President David Malpass. “We will continue to provide critical assistance to developing countries through this ongoing pandemic to help achieve a more broad-based economic recovery. The Bank Group has proven to be a rapid, innovative, and effective platform to support developing countries as they respond to the pandemic and strengthen resilience for future shocks. But we must do more still. I remain deeply concerned about limited availability of vaccines for developing countries, which are critical to save lives and livelihoods.”
|World Bank Group Commitments (in U.S. billions)|
|World Bank Group||Q4-FY20||FY21*||15-mo ending June 21*|
|Long-term finance (own account)||4.9||12.5||17.4|
|Recipient-executed trust funds (RETF)||1.5||6.4||7.9|
|TOTAL (excluding short-term finance, mobilization, and RETF)||39.6||84.3||123.9|
|TOTAL (including short-term finance, mobilization and RETF)||47.4||109.7||157.1|
|*Preliminary and unaudited numbers as of July 14.|
In the 15 months ending June 30, 2021, the Bank Group stretched its balance sheets, accelerated leveraging and disbursements, and front-loaded resources. Support to countries from the International Bank for Reconstruction and Development (IBRD) totaled $45.6 billion – including drawing down IBRD’s $10 billion crisis buffer in addition to Board-approved sustainable annual lending limits. Grants and zero or low-interest loans to the world’s poorest countries from the International Development Association (IDA) amounted to $53.3 billion. To meet increased financing needs, the World Bank fully used all remaining IDA18 resources in FY20 and frontloaded about half of all the three-year envelope of IDA19 resources in FY21. In February 2021, IDA donor and borrower country representatives agreed to advance IDA20 by 12 months to enable continued surge financing in the coming years.
In addition, over the same 15 months, the International Finance Corporation (IFC), the Bank Group’s private sector development arm, reached a record high of $42.7 billion in financing, including short-term finance ($10.4 billion) and mobilization ($14.9 billion), 37% of which was in low-income and fragile and conflict-affected states. IFC provided liquidity for businesses to remain in operation, while ramping up investments in companies on the frontlines of the pandemic response. To address the COVID-induced increase in the trade gap, IFC has expanded its trade and supply chain finance activities. IFC’s “Upstream” work continues to create the conditions to attract much-needed private investment to some of the world’s most difficult places and preparing the ground for a faster private sector recovery.
Despite a challenging year for borrowers and financial markets, IDA doubled the amount it raised last fiscal year from investors, reaching almost $10 billion. IBRD raised $68 billion, by mobilizing financing from investors around the globe. IBRD and IDA, both rated AAA/Aaa, raised awareness for a variety of development themes to successfully mobilize finance for sustainable development. The year also included innovations such as a unique $100 million five-year bond issued by IBRD to support the global response to COVID-19 through UNICEF. IFC, also rated AAA/Aaa, issued close to $13 billion in bonds for private sector development and job creation in emerging markets.
The Multilateral Investment Guarantee Agency (MIGA), whose mandate is to drive impactful foreign direct investment to developing countries, issued $7.6 billion in new guarantees over the same 15-month period since the onset of the pandemic, of which 19% supported projects in IDA countries and fragile settings.
In FY21, the World Bank Group’s climate finance totaled over $26 billion, it’s largest year of climate finance ever (25% above FY20, which was itself also a record). The new Climate Change Action Plan for 2021-2025 aims to integrate climate and development goals, and commits 35% of Bank Group financing to climate, on average, over the next five years, with at least 50% of World Bank climate finance supporting adaptation. In the same time frame, the Bank Group will align financing with the goals of the Paris Agreement, while helping client countries meet their Paris commitments, including supporting and implementation of development of their Nationally Determined Contributions (NDCs) and Long-Term Strategies.
Greenpeace Africa responds to the cancellation of oil blocks in Salonga National Park
On Monday the UNESCO World Heritage Committee decided to remove Salonga National Park in the Democratic Republic of the Congo from the List of World Heritage in Danger. The decision follows clarification “provided by the national authorities that the oil concessions overlapping with the property are nul[l] and void and that these blocks will be excluded from future auctioning.”
Oil blocks overlapping with Salonga were awarded by President Joseph Kabila in the twilight of his regime. Greenpeace Africa has repeatedly demanded their cancellation, while local leaders voiced their opposition to the project in light of its impacts on communities.
“A decision by President Felix Tshisekedi to cancel all oil blocks in Salonga Park must be followed by a decision to cancel oil blocks in Virunga Park and across the Cuvette Centrale region. These are vast areas rich in biodiversity that provide clean water, food security and medicine to local communities and which render environmental services to humanity,” says Irene Wabiwa Betoko, International Project Leader for the Congo Basin forest.
The Salonga National Park, which is Africa’s largest tropical rainforest reserve, was inscribed on the World Heritage List in 1984. The park plays a fundamental role in climate regulation and the sequestration of carbon. The park is also home to numerous endemic endangered species such as the pygmy chimpanzee (or bonobo), the forest elephant, the African slender-snouted crocodile and the Congo peacock. Salonga had been inscribed on the List of World Heritage in Danger in 1999, due to pressures such as poaching, deforestation and poor management. The government of DRC later on issued oil drilling licences that encroached on the protected area, posing a threat to the wildlife-rich site.
“DRC’s auctioning of oil blocks has not only been scandalously lacking transparency and menacing for particularly sensitive environmental areas – they neither benefit Congolese people nor the planet. Instead of privileging a small group of beneficiaries of the toxic fossil fuels industry, diversifying the DRC’s economy should be done through renewable energy investments that will make energy accessible and affordable for all,” Irene Wabiwa concluded.
Greenpeace Africa urges full transparency from both UNESCO and the DRC government and calls for the publication of all supportive documents regarding the decision to cancel the aforementioned oil blocks, as well as the map of the nine oil blocks that are still being auctioned in the Cuvette Centrale region.
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