Global crisis likely to drag 21 million Asians into poverty

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Manila: The global financial crisis could drag 21 million people of the Asia-Pacific region into extreme poverty, a UN and Asian Development Bank report said on Wednesday.
The report, entitled “Achieving the Millennium Development Goals in an Era of Global Uncertainty”, said the global downturn has hampered the region’s efforts to reduce poverty.
“On the basis of the most recent estimates of economic growth, in 2009, the crisis could trap an additional 17 million people on incomes of less than $1.25 a day and another 4 million in 2010,” the report said.
“This crisis has indicated that the region is still vulnerable to setbacks, which, in the era of globalization can be transmitted from anywhere in the world,” it added.
The report said among those adversely affected by the crisis are women since they constitute the majority of Asia’s low-skilled, low-salaried and temporary workforce that can be easily laid off during economic downturns.
But it noted that the crisis has also opened up opportunities for the region to protect itself from future downturns and continue the pursuit of the UN’s Millennium Development Goals which include poverty reduction, education, and health and environment protection.
“As the crisis has exposed much vulnerability in the region, we can now address them and direct this recovery towards a stronger sustainable path for the Asia-Pacific region,” said Noeleen Heyzer, executive secretary of the UN Economic and Social Commission for Asia and the Pacific.
The report noted the importance of stimulus packages with a strong social aspect and stressed that long-term social protection can strengthen Asia’s resilience against future shocks.
“If fiscal stimulus have a strong component of social expenditures … this is likely to produce a double dividend – not only boosting growth more rapidly but also accelerating progress towards the millennium development goals,” it said.
The report also cited the importance of regional cooperation, including the creation of grains’ banks that are maintained in each country but accessible to others.
“Expanding Asian monetary and financial coordination would be particularly useful to reduce external shocks such as with the global financial crisis,” it said.

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