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81 million jobs lost as COVID-19 creates turmoil in Asia-Pacific labour markets

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Women at work in a garment factory in Hai Phong, Viet Nam. © ILO

Massive drops in working hours due to the COVID-19 crisis  have had a devastating effect on jobs and incomes in Asia and the Pacific according to a new report by the International Labour Organization (ILO).

According to Asia–Pacific Employment and Social Outlook 2020: Navigating the crisis towards a human-centred future of work  estimates, the economic backlash of the COVID-19 pandemic wiped out some 81 million jobs in 2020. In nearly all economies with available quarterly data for 2020, employment levels contracted compared to 2019.

The impact of the crisis has been far-reaching, with underemployment surging as millions of workers are asked to work reduced hours or no hours at all. Overall, working hours in Asia and the Pacific decreased by an estimated 15.2 per cent in the second quarter and by 10.7 per cent in the third quarter of 2020, relative to pre-crisis levels.

Working-hour losses are also influenced by the millions of persons moving outside the labour force or into unemployment as job creation in the region collapsed. Using available quarterly data, the report provides a preliminary estimate that the regional unemployment rate could increase from 4.4 per cent in 2019 to somewhere between 5.2 per cent and 5.7 per cent in 2020.

“COVID-19 has inflicted a hammer-blow on the region’s labour markets, one that few governments in the region stood ready to handle. Low levels of social security coverage and limited institutional capacity in many countries have made it difficult to help enterprises and workers back on their feet, a situation compounded when large numbers remain in the informal economy. These pre-crisis weaknesses have left far too many exposed to the pain of economic insecurity when the pandemic hit and inflicted its toll on working hours and jobs,” said Ms Chihoko Asada Miyakawa, ILO Assistant Director General and Regional Director for Asia and the Pacific.

Women and young people are disproportionately hit

According to the report, most countries in the region saw a larger decline in working hours and employment for women than men. Also, women were more likely to move into inactivity than men. Young people have also been especially affected by working-hour and job losses. The youth share in overall employment loss was 3 to 18 times higher than their share in total employment.

“The report shows a clear picture of young people and women being pushed out of work compared to other workers,” says Ms Sara Elder, Senior Economist at the ILO Regional Office for Asia and the Pacific and lead author of the report. “With increased unemployment, young workers are likely to find it difficult to compete for new jobs. When they do find work, it may well be a job that does not match to their aspirations. Millions of women have also paid a high price and it could take years for those who have exited the labour force to return to full employment.”

Labour income as another crisis victim

With fewer paid hours of work, median incomes are falling. Overall, labour income is estimated to have fallen by as much as 10 per cent in the Asia–Pacific region in the first three quarters of 2020, equivalent to a 3 per cent loss in gross domestic product. A further consequence is the increase in working poverty levels. In absolute numbers, preliminary estimates in the report find an additional 22 million to 25 million persons could fall into working poverty, which would push the total number of working poor (living on less than $1.90 a day) in the Asia–Pacific region to between 94 and 98 million in 2020.

The report also warns that given the scope of the damage to labour markets, the overall size of the fiscal response in the region has been insufficient, especially in the region’s developing economies. As a result of fiscal expenditure gaps, the crisis is likely to exacerbate inequalities among countries in the Asia and the Pacific.

“On the more positive side,” says Ms Elder, “we are able to show in this report that government efforts to help enterprises retain workers, albeit on reduced hours, have worked to prevent what would otherwise be larger job losses. Given the mounting evidence that social protection and employment policies save jobs and incomes, the hope is that the crisis brings about a more permanent and increased investment in elements needed to boost resilience and promote a more people-centred future of work.”

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Citizens globally affirm belief in international cooperation

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The UN undertook a global crowdsourcing opinion campaign as part of its 75th anniversary celebrated in 2020. United Nations

People worldwide have overwhelmingly highlighted their faith in multilateralism to address global challenges, the results of a year-long survey by the United Nations have shown. 

The UN75 initiative was launched by Secretary-General António Guterres, in January last year, to understand the global public’s hopes and fears for the future, as well as their expectations and ideas for international cooperation, and for the UN in particular. More than 1.5 million people from 195 countries took part in the campaign through surveys and dialogues. 

“The UN75 global consultation showed that 97 per cent of respondents support international cooperation to tackle global challenges,” Mr. Guterres said on the results

“That represents a very strong commitment to multilateralism, and to the mission of the United Nations. Now it is up to us – Member States and the UN Secretariat – to meet the expectations of the people we serve,” he added. 

Unity across groups and regions 

Announcing the findings at the UN Office at Geneva on Friday, Fabrizio Hochschild, Special Adviser to the Secretary-General on the commemoration of UN’s 75th anniversary, said that together with UN75 conversations and surveys, innovative methodologies and artificial intelligence analysis were employed to gauge world opinion, including through traditional and social media. 

In addition, two independent surveys were commissioned around the same questions to have a “reality check”, and the results were striking, he continued. 

Unity, across generations, regions income groups, and levels of education, was one such striking result, Mr. Hochschild highlighted, explaining that opinions were united when it came to people’s hopes and fears for their future, and their expectations of international cooperation. 

In the immediate priorities post-COVID-19, the world is united in wanting much better access to affordable basic services, healthcare, quality education, water and sanitation, and related is the world seeks much greater solidarity with the hardest hit communities and places, he added. 

Launched to mark the Organization’s 75th anniversary, the exercise was the UN’s most ambitious effort to date to gather input from the global public, and the largest survey on priorities for recovering from the COVID-19 pandemic. 

Short-term challenges 

With the coronavirus pandemic reversing progress in human development and widening inequalities, many respondents prioritized access to basic services and support to the hardest hit places and communities in the short-term, according to the results

The top immediate, short-term priority globally was universal access to healthcare. 

In addition, given the impact of the crisis on children and education, greater investments in education and youth programmes ranked high among respondents, particularly in sub-Saharan Africa, and central and southern Asia. 

Long-term challenges 

Similarly, while people expect access to health services to improve over the next 25 years, respondents in all regions identified climate change and environmental issues as the number one long-term global challenge. 

Other longer-term priorities vary according to income levels, but include rising concern with employment opportunities, respect for human rights and reducing conflict. 

Respondents in higher human development countries tended to give the highest priority to the environment and human rights, those in lower human development countries tended to accord the highest priority to less conflict and meeting basic needs, such as employment, healthcare and education. 

UN’s role 

Many respondents also looked to the United Nations to lead in international cooperation to address immediate and longer-term global challenges, the results showed, with many also want the Organization to innovate – to be more inclusive, engaged, accountable and effective. 

In surveys and UN75 dialogues held around the world, participants called on the UN for moral leadership; a more reformed, representative and agile Security Council; and an inclusive and participatory UN system, with improved understanding of the work of the Organization among citizens around the world, and which shows more care for the needs of the people. 

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World Bank Signs $105 Million Project to Improve Waterways in West Bengal

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The Government of India, the Government of West Bengal and the World Bank today signed a $105 million project to improve the inland water transport infrastructure in Kolkata, West Bengal.

The West Bengal Inland Water Transport, Logistics and Spatial Development Project will facilitate passenger and freight movement across the Hooghly river; undertake spatial planning to improve accessibility in the Kolkata Metropolitan Area; enhance the quality of life of its residents; and contribute to the growth of the state’s logistics sector.

“Inland waterways are now emerging as a cost effective and an environment friendly option for passenger and freight movement,” said C S Mohapatra, Additional Secretary, Department of Economic Affairs, Ministry of Finance. “This Project will help improve the river transport infrastructure in West Bengal and help in the economic development of the state by connecting the hinterland with markets and job centers in Kolkata’s Metropolitan Area,” he added.

The agreement was signed by C S Mohapatra, Additional Secretary, Department of Economic Affairs, Ministry of Finance on behalf of the Government of India; Rajdeep Dutta, Deputy Resident Commissioner on behalf of the Government of West Bengal; and Junaid Ahmad, Country Director, India on behalf of the World Bank.

The project will cover the five most populous districts of southern West Bengal, including its urban agglomeration — the Kolkata Metropolitan Area (KMA) where around 30 million people or one-third of West Bengal’s population live.

“This operation will allow the state to invest in Kolkata’s economic productivity by making its waterways and ferry services part of an efficient and safe urban mobility strategy,” said Junaid Ahmad, World Bank Country Director in India. “Importantly, given Kolkata’s strategic location, the project is also ensuring that the metropolitan area emerges as a transport and logistics hub for the sub-region, leveraging the EDFC and connecting to the north-east and the land-locked countries of Nepal and Bhutan.”

The Hooghly river,  a distributary of the river Ganga, in Kolkata separates the Kolkata port from its large consumption centers, which are, its wholesale market and its vast hinterland comprising among others the entire North East of India and two landlocked neighboring countries namely, Nepal and Bhutan. More than 80 percent of freight and passenger traffic currently cross the river via Kolkata’s three bridges. To curtail congestion, the city has restricted the movement of trucks to the port to certain bridges and only during limited hours, reducing access to the port and increasing the cost of logistics.

West Bengal’s ferries can provide an efficient, flexible mode of public transport for both passengers and freight, saving on operating costs and travel time when compared with road journeys. The existing ferry system, operational for decades, caters to less than 2 percent of the passenger traffic and a small portion of the freight movement. Developing the river transport infrastructure will enable a large population of the state to utilize its waterways, have alternative, multi-modal options for transportation for both freight and passengers, connect the hinterland with Kolkata Metropolitan Area’s markets and job centers and emerge as a logistics hub.

In the first phase, the project will enhance the capacity and improve the safety of the Inland Water Transport system; including rehabilitating existing jetties, buying new ferries with enhanced design; and installing electronic gates in 40 locations. In the second phase, it will support long-term investments for passenger movements, including in terminals and jetties; improve the design of the inland water transport vessels; ensure night navigation on the most hazardous and trafficked routes and crossing points; and encourage the private sector to invest in Ro-Ro vessels that will allow easier movement of trucks across the Hooghly river.

“Such long-term planning will not only help the city improve passenger and freight transport, but allow it to utilize its waterfront and enable more efficient land use and urban planning,” said Fuad Malkawi, Senior Urban Development Specialist and Natalya Stankevich, Senior Transport Specialist and task team leaders for the project. “Improving ferry services is also critical for some of the most disadvantaged community groups who are dependent on IWT,” they added.

To better cope with increased precipitation and flooding, climate-smart engineering solutions will be applied, including modular floating designs for ferry access points at the passenger terminals. In addition, the project will facilitate disable-friendly amenities, ensure women’s safety and encourage women’s employment in the IWT Department as well as with the ferry operators.

The $105 million loan from the International Bank for Reconstruction and Development (IBRD), has a maturity of 17 years, including a grace period of 7 years.

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Reforming Lebanon’s Port Sector to Build Back a Better Port of Beirut

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Reforming Lebanon’s port sector is a prerequisite for building back a better Port of Beirut and revitalizing the Lebanese economy, according to a new World Bank note that aims to provide guidance to policymakers on the crucial additional requirements for the rebuilding of the Port of Beirut (PoB).

The note titled Reforming and Rebuilding Lebanon’s Port Sector: Lessons from Global Practices summarizes global best practices in port governance and border management reforms, and offers a set of guiding principles to help inform port sector reforms in Lebanon and pave the way to rebuild a better PoB. The note also draws on extensive consultations with public and private sector organizations, civil society, academia, and the diplomatic and donor communities.

Following the August 4, 2020, massive PoB explosion that devastated the city, killing at least 200 people, wounding thousands, and displacing around 300,000, a Rapid Damage and Needs Assessment (RDNA), prepared by the World Bank in cooperation with the United Nations and the European Union, estimated damage to the PoB at about US$350 million. Five months after the tragic event, there is still a need to balance the immediate actions needed to secure Lebanon’s vital imports with the opportunity this crisis offers to “build back better” the ports system of Lebanon and stimulate trade and economic growth.

The Port of Beirut is the main gateway for the external trade of Lebanon, but it has failed in its key role as an enabler of economic development in the country by failing to guarantee safe and efficient operations and undertaking the necessary long-term strategic planning. These failures are a direct result of the current mismanagement and lack of good governance of the Port that was established in a legal vacuum and adheres to a port management system that arguably reflects the complex political-economic realities of Lebanon, and which as a result run counter to many recognized good practices.

The note argues that a crucial pre-requisite to the rebuilding of the Port is the establishment of a robust institutional framework for the port sector. This framework will pave the way to rebuild a modern, transparent and efficient port and to restore trust of the Lebanese society and port users into its capacity to strengthen the economic fabric and provide support in overcoming the country’s economic crisis.

“A new national port sector strategy is needed to optimize port infrastructure across Lebanon and to serve best the country and allow improved transit and trade,” said Saroj Kumar Jha, World Bank Mashreq Regional Director. “Building back better means revisiting the siting and sizing of the PoB, and rebalancing roles and investments in other ports and other logistics infrastructure using an economic corridor approach to position Lebanon to benefit from future opportunities in the Mashreq region.”

The note also argues that the reconstruction roadmap of the Port of Beirut should have four key building blocks: i) a new governance structure based on the landlord port model; ii) efficient and modern Customs, border agency and trade processes that have an essential role in addressing transparency, predictability and security issues; iii) open and transparent bidding processes for selecting investors, operators or concessionaires; and iv) quality infrastructure that is contingent on a countrywide strategy for the port sector and a revised masterplan for the Port of Beirut.

When effectively implemented in a transparent and participatory manner, these reforms would meet the demands and aspirations of the Lebanese people and all stakeholders towards the efficient functioning of the Port. The World Bank Group stands ready to engage with the port sector stakeholders and a reform-minded government to reform the port sector of Lebanon and rebuild a modern and efficient Port, based on the global best practice presented in this Note.

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