midst the many unknowns in the post-pandemic recovery, the socio-economic inequalities starkly revealed by the virus have never been clearer. In Asia, where over 1.3 billion people are employed in the informal sector, whose livelihoods are based on hand-to-mouth subsistence, without any savings or assets to fall back on, are most likely to lose their jobs and face extreme poverty and food insecurity.
The full extent of the economic impacts are still unfolding, but forecasts suggest that COVID-19 could deplete $211 billion from Asia-Pacific incomes, preventing at least 24 million people from escaping poverty and driving an additional 11 million people into poverty this year alone.
In many ways this is an opportunity for a hard reset. While the urgency of the current situation calls for quick gains, this extraordinary scale of the recovery effort presents a unique opportunity to enable systemic overhaul that is effective and equitable.
Some have drawn comparisons between the current situation and the Great Depression. Just as President Roosevelt responded with The New Deal—a series of targeted programs, public works projects, and financial reforms—governments today are rolling out gargantuan stimulus packages meant to address their biggest national issues. Such stimulus investments can catalyze important systemic change in economic sectors while also meeting the urgent need for creating employment, or otherwise trigger changes necessary to support longer-term resilience outcomes.
This realization has spurred many Asian governments to respond with policies aimed at supporting the hardest-hit SMEs, and even more broadly, long-term, sustainable changes in addressing the stark digital divide among populations, food and energy insecurities, and the impact of climate change.
The Great Digital Gap
The pandemic has exposed modern inequalities in digital infrastructure access and literacy. In our tech-reliant world, digital poverty has far-reaching impacts on tangible real-world poverty. For example, lack of access to digital tools and platforms can further push women away from economic opportunities, widening the gender gap.
A similar issue is arising in healthcare, education, and energy sectors as delivery of critical services increasingly depends on access to technology. Advancements and innovations available to parts of the population who are digitally connected during this pandemic has put those without access and literacy at a tremendous risk of falling even further behind. As more essential services are now being migrated online, closing this divide has become a priority for many governments, especially in Asia.
Despite remarkable progress over the past decade, the region’s digital economy remains deeply divided along economic, geographic and gender lines. More than 2 billion people in Asia do not have access to the Internet, including 207 million women in South Asia who do not even own a mobile phone. These people are without a lifeline to overcome the hardships caused by lockdowns and social distancing.
For those who are online, economic opportunities are not equally available. Recent research by Google, Temasek and Bain & Company reveals that seven cities in Southeast Asia make up more than half of the region’s digital economy, despite accounting for only 15 percent of its population.
Allowing the digital divide to widen will only further entrench socioeconomic inequalities. With the virus fueling digital transformation at unprecedented rates, digital inclusion of underserved groups must be central to governments’ recovery and job creation plans.
Technologies are also a driver for improving government efficiency, transparency and responsiveness. However, the capacity of developing countries to adopt them is typically weak. To address this reality, the Rockefeller Foundation is partnering with organizations to develop a platform for collaborative governance innovation across the region. This platform will enable a multitude of stakeholders to engage in dialogue and action towards data-driven policymaking.
A Critical Moment for Sustainable Development
Even before the outbreak, Asia-Pacific stood at an inflection point in its development journey. Pre-COVID-19, UNESCAP reported that the region was on course to miss all 17 of the Sustainable Development Goals by 2030.
The climate crisis continues to impact populations across Asia in unequal ways, a fact that is now exacerbated by COVID-19. For example, heavier-than-usual monsoon rains have created a disaster within a pandemic for millions of families across India, Nepal and Bangladesh, with an estimated 2,000 villages under water.
The ripple effect of climate change on economic health is also undeniable. The Asia-Pacific economy is forecast to shrink by 2.6 percent by 2050 due to its inability to withstand the impacts.
Targeted stimulus policies can help address these devastating inequalities when designed with the goals of social inclusion and environmental sustainability in mind.
A wide range of advocates—from the IMF to the UN and the Pope—have argued that ploughing investments into green solutions, such as public transport, renewable energy generation, energy efficiency and electric vehicles, will not only enable governments to avert an ecological crises but also pivot their economies towards the growth industries of tomorrow.
This is backed by new research which suggests that spending money on climate friendly “green” policy initiatives could not only cut emissions but also offer the best economic returns for government spending. This sentiment is echoed by the WWF, which points to evidence that, following the last financial crisis, green infrastructure created more jobs than brown infrastructure in the United States and EU.
To give one example, new renewable energy supplies could bring electricity to underserved populations in lower- and middle-income countries. At The Rockefeller Foundation, we’re leveraging decentralized solar mini grids to accelerate the pace of electrification in India and Myanmar, through the unique vehicles Smart Power India and Smart Power Myanmar. This effort is borne out of a recognition that there is no pathway out of poverty without access to reliable and affordable electricity.
Building Back Better
The Covid-19 pandemic has revealed the vulnerabilities and failures of our systems, and the urgent need to build back better. A central dimension of building back better is the need for a people-centered recovery that focuses on well-being, improves inclusiveness, and reduces inequality. More specifically, where stimulus packages target environmental objectives, a focus on people’s well-being is also crucial to cement the social and political acceptance of environmental measures.
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A Modern ‘New Deal’ Must Look at Social Impact Differently
Photo by Karl Janisse via Unsplash.
August 31, 2020
A
midst the many unknowns in the post-pandemic recovery, the socio-economic inequalities starkly revealed by the virus have never been clearer. In Asia, where over 1.3 billion people are employed in the informal sector, whose livelihoods are based on hand-to-mouth subsistence, without any savings or assets to fall back on, are most likely to lose their jobs and face extreme poverty and food insecurity.
The full extent of the economic impacts are still unfolding, but forecasts suggest that COVID-19 could deplete $211 billion from Asia-Pacific incomes, preventing at least 24 million people from escaping poverty and driving an additional 11 million people into poverty this year alone.
In many ways this is an opportunity for a hard reset. While the urgency of the current situation calls for quick gains, this extraordinary scale of the recovery effort presents a unique opportunity to enable systemic overhaul that is effective and equitable.
Some have drawn comparisons between the current situation and the Great Depression. Just as President Roosevelt responded with The New Deal—a series of targeted programs, public works projects, and financial reforms—governments today are rolling out gargantuan stimulus packages meant to address their biggest national issues. Such stimulus investments can catalyze important systemic change in economic sectors while also meeting the urgent need for creating employment, or otherwise trigger changes necessary to support longer-term resilience outcomes.
This realization has spurred many Asian governments to respond with policies aimed at supporting the hardest-hit SMEs, and even more broadly, long-term, sustainable changes in addressing the stark digital divide among populations, food and energy insecurities, and the impact of climate change.
The Great Digital Gap
The pandemic has exposed modern inequalities in digital infrastructure access and literacy. In our tech-reliant world, digital poverty has far-reaching impacts on tangible real-world poverty. For example, lack of access to digital tools and platforms can further push women away from economic opportunities, widening the gender gap.
A similar issue is arising in healthcare, education, and energy sectors as delivery of critical services increasingly depends on access to technology. Advancements and innovations available to parts of the population who are digitally connected during this pandemic has put those without access and literacy at a tremendous risk of falling even further behind. As more essential services are now being migrated online, closing this divide has become a priority for many governments, especially in Asia.
Despite remarkable progress over the past decade, the region’s digital economy remains deeply divided along economic, geographic and gender lines. More than 2 billion people in Asia do not have access to the Internet, including 207 million women in South Asia who do not even own a mobile phone. These people are without a lifeline to overcome the hardships caused by lockdowns and social distancing.
For those who are online, economic opportunities are not equally available. Recent research by Google, Temasek and Bain & Company reveals that seven cities in Southeast Asia make up more than half of the region’s digital economy, despite accounting for only 15 percent of its population.
Allowing the digital divide to widen will only further entrench socioeconomic inequalities. With the virus fueling digital transformation at unprecedented rates, digital inclusion of underserved groups must be central to governments’ recovery and job creation plans.
Technologies are also a driver for improving government efficiency, transparency and responsiveness. However, the capacity of developing countries to adopt them is typically weak. To address this reality, the Rockefeller Foundation is partnering with organizations to develop a platform for collaborative governance innovation across the region. This platform will enable a multitude of stakeholders to engage in dialogue and action towards data-driven policymaking.
A Critical Moment for Sustainable Development
Even before the outbreak, Asia-Pacific stood at an inflection point in its development journey. Pre-COVID-19, UNESCAP reported that the region was on course to miss all 17 of the Sustainable Development Goals by 2030.
The climate crisis continues to impact populations across Asia in unequal ways, a fact that is now exacerbated by COVID-19. For example, heavier-than-usual monsoon rains have created a disaster within a pandemic for millions of families across India, Nepal and Bangladesh, with an estimated 2,000 villages under water.
The ripple effect of climate change on economic health is also undeniable. The Asia-Pacific economy is forecast to shrink by 2.6 percent by 2050 due to its inability to withstand the impacts.
Targeted stimulus policies can help address these devastating inequalities when designed with the goals of social inclusion and environmental sustainability in mind.
A wide range of advocates—from the IMF to the UN and the Pope—have argued that ploughing investments into green solutions, such as public transport, renewable energy generation, energy efficiency and electric vehicles, will not only enable governments to avert an ecological crises but also pivot their economies towards the growth industries of tomorrow.
This is backed by new research which suggests that spending money on climate friendly “green” policy initiatives could not only cut emissions but also offer the best economic returns for government spending. This sentiment is echoed by the WWF, which points to evidence that, following the last financial crisis, green infrastructure created more jobs than brown infrastructure in the United States and EU.
To give one example, new renewable energy supplies could bring electricity to underserved populations in lower- and middle-income countries. At The Rockefeller Foundation, we’re leveraging decentralized solar mini grids to accelerate the pace of electrification in India and Myanmar, through the unique vehicles Smart Power India and Smart Power Myanmar. This effort is borne out of a recognition that there is no pathway out of poverty without access to reliable and affordable electricity.
Building Back Better
The Covid-19 pandemic has revealed the vulnerabilities and failures of our systems, and the urgent need to build back better. A central dimension of building back better is the need for a people-centered recovery that focuses on well-being, improves inclusiveness, and reduces inequality. More specifically, where stimulus packages target environmental objectives, a focus on people’s well-being is also crucial to cement the social and political acceptance of environmental measures.
