Reform Needed As Big Business, Not Vulnerable Communities Benefit from Post-Pandemic Support — Global Issues
BRATISLAVA, October 12 (IPS) – Governments and international financial institutions must adopt new ways to provide post-pandemic support, campaigners said after a report found in Many poorer countries, big businesses benefit the most from the Covid-19 recovery fund. At the same time, vulnerable communities have been “left behind”.
They say the extent and distribution of support from these funds are poor, with the most vulnerable in society, such as informal workers and women, among others, especially failed by relief programs.
And they warn that the measures really only deepen inequality at a time when The UN has warned that up to 95 million more people could soon fall into extreme poverty compared with pre-Covid-19 levels.
Matti Kohonen, Director of the Financial Transparency Coalition (FTC), which is behind the report, told IPS: “The elites have been sheltered from the worst impacts of the pandemic. Nearly 40% of Covid-19 recovery funds go to large corporations, through measures such as loans and tax cuts. This means that social protection for women and informal workers is lacking”.
The Research by FTC shows that in 21 countries in the Global South, large corporations receive 38% of the recovery fund while small and medium enterprises (SMEs) receive 20%. Social protection measures accounted for 38%.
In comparison, informal workers receive only 4% of funds in the countries surveyed, and research shows that in many of those states, they actually receive nothing.
Studies have shown that informal workers, especially women, are hardest hit globally by the Covid-19 pandemic, and the economic policy measures taken are largely blind. gender, exacerbating existing gender inequalities and economic precariousness in this area.
According to the International Labor Organization (ILO), of the 2 billion informal workers worldwide, more than 740 million are women. However, the proportion of women in informal work is higher than that of men in many of the poorest regions of the world: in more than 90% of countries in sub-Saharan Africa, 89% of countries in South Asia, and almost 75% of all countries. Latin America. .
These women also often have jobs that involve poor conditions, limited or non-existent labor rights and social protection, and low pay.
The FTC report indicates that while the COVID-19 pandemic has had a huge impact on women’s employment, working hours and an increase in unpaid care and family work, it finds that women receive half as much money as men because most of the money provided to companies and also to smaller companies is mainly owned by men (accounting for more than 59% of the fund).
Klelia Guerrero, Economist at the Latin American Economic and Social Justice Network (LATINDADD), who helped research the FTC report, says it’s just the job of collecting data on the distribution of recovery funds. The review highlighted how less thought-provoking women were. Covid-19 response policies.
Only in some of the countries surveyed (Guatemala, Honduras, Bangladesh, Brazil and Costa Rica) are there partially sex-disaggregated data on Covid-19 grants available to analyze Covid-19 support- 19.
“Most countries do not have separate gender data; it’s just a part. This in itself should be a red sign – it shows that the people who are doing these support programs don’t consider women a priority,” Guerrero told IPS.
And while the report found that women received the majority of social protection funds in the countries surveyed, even some of those programs “have discriminatory aspects.”
“For example, here in Ecuador, we had a scheme where people had to register online and then come in at certain times to receive their aid products. This was difficult for a lot of women at the time, who had to stay at home or have no public transport to get the aid. So women are disadvantaged,” she said.
“Some population groups have benefited from Covid relief measures, but the most vulnerable are not so much. It is difficult for them to access aid. The criteria by which aid is given must include a gender perspective. ” she added.
Other equality campaigners agree.
“Many studies have shown how, especially in Africa, women make up the majority of the informal sector. One of the key points of the report is women’s targeting of the poor in response to support. Future programs need to take gender into account in any policy,” Ishmael Zulu, Tax and Policy Officer at the Tax Justice Network Africa (TJNA), told IPS.
Groups like the FTC and its members, including the TJNA, say the report’s findings are important not only in terms of post-pandemic recovery, but also highlight the need to change the way support is given to the most vulnerable communities in developing countries over the long term. -future.
Ishmael pointed out that in one scheme in Zambia, the government introduced stimulus measures to help small and medium-sized enterprises and informal workers, but the money being routed through commercial banks placed requirements specific requirements to access that money, including having to provide bank statements.
“Of course, that is very difficult for many informal workers. They just can’t provide those documents. So in the end, even money for vulnerable groups ends up in the hands of large corporations who can provide those documents,” he explained. “It speaks to the weakness of the system.”
The FTC report also warns that the policies pursued by international financial institutions, such as the International Monetary Fund (IMF), push countries to adopt austerity and cutting measures. Reducing funding for basic public services in exchange for debt restructuring is making things worse.
It cites the example of public spending cuts and Value Added Tax (VAT) increases being introduced as part of the IMF’s lending program in Zambia, saying this will have the greatest impact on poor.
“Our current financial structures perpetuate inequalities in how, for example, financial institutions lend: some countries have had to reform their tax systems,” says Ishmael. and these financial institutions argue that subsidies and spending should be channeled into some sectors and not others, and as a result, money is targeted at large companies, and vulnerable communities. hurt left behind. “
He added: “We see inequality growing, and so when Covid-19 hit, we saw how these vulnerable communities were left behind without a grid. safe. Governments must establish sustainable social protection systems that provide safety nets to help lift people out of poverty and this system will not only respond to pandemics or emergencies, but also respond to combat poverty and inequality. “
The FTC is planning to present its findings at the IMF/World Bank Annual Meetings later this month.
The FTC report calls on all countries and international organizations, including the IMF and World Bank, to implement what it describes as “alternative policies to bring about a people-led recovery.” centered instead of austerity”.
These include, among others, taxing excess corporate profits, adopting a progressive income and wealth tax rate, and increasing contributions and social security coverage.
Kohonen said informal labor and women should be at the heart of any such policy.
“The informal sector and female workers have really pulled us through the pandemic, and it is wrong to impose austerity on them now. Support needs to be given to informal workers and women, who are on the front lines, before a pandemic so that support can then be extended if needed, in the form of loans, grants or institutes. other aid,” he said.
Report of the United Nations Office IPS
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