UNDP / ECONOMIC CRISIS

The current global economic crisis, which began with the severe strains on the financial and banking system in parts of the developed world, now risks triggering a human development catastrophe in the world’s poorest countries.

As the leaders of the richest nations set off to London for the G-20 summit this Thursday (2 April), the United Nations Development Programme (UNDP) warns that those most vulnerable to the crisis are living outside the spotlight and their predicament should be addressed at the table.

SOUNDBITE (English) Ad Melkert, UNDP Acting Administrator:
“I think the G20 leaders should really recognize in the first place that we’re in it all together. It’s not a matter of a crisis in America, in Europe, or in Asia, it’s a crisis everywhere. Secondly they should recognize the human development side of it, so continuing to support countries in their efforts to combat poverty and to invest in people should remain key. And thirdly I think really an initiative to open up trade, to fight against protectionism, and to make sure trade is inclusive, not only benefiting the big producers but also developing countries and their products.”

In the Pakistani city of Karachi the garment industry has been hit hard by the crisis. Large scale manufacturing has slumped by 8.91 percent in January of current fiscal year, reinforcing fears of major layoffs and closing down of industrial units in the country.

Garment manufacturing, one of the main industries, has seen factories shut down and garment factory workers finding themselves out of work.

SOUNDBITE (Urdu) Owner of shut-down factory:
“We have an ongoing crisis in the garment industry and Pakistani exports are in peril. Factories are forced to close and there's a lack of foreign currency coming in.”

Analyses of past recessions reveal that poor countries suffer substantially more than their richer counterparts, not just in terms of job and income loss, but in health and education indicators – life expectancy, school enrollment and completion rates all drop.

In low-income countries, women, children and the poorest segments of society, are the most susceptible to the consequences of economic collapse. Data gathered during previous economic downturns indicates that even among poor children, girls are more likely to be pulled out of school than boys.

SOUNDBITE (Spanish) Rebeca Grynspan UNDP director for Latin America:
“We must remember that developing countries don’t have automatic stabilizers. We don’t have integral social service systems that protect people and families from the crisis, but rather people and their families receive the entire effect of the crisis because we don’t have these systems of protection.”

In northern Zambia, copper mining has dropped significantly and many miners are losing their income.

But the effects are far wider then that.

SOUNDBITE: (English) Out-of-work miner:
“If you close mining activities which means all other areas will be affected. Farmers are affected, teachers are affected, police, because all these people are mostly reliant on the mining, which miners are circulating within the system.”

At the G-20 summit, UN Secretary-General Ban KI-moon will speak for the 150 developing countries not present around the table. He will point to the human development crisis and warn that unless urgent and decisive action is taken to protect the most vulnerable, the economic crisis may soon be compounded by political instability and global insecurity.