Selim Jahan, Director,
UNDP Poverty Division
At the G-20 summit in April, leaders of the world’s 20 largest economies approved measures aimed at delivering economic change.
MediaGlobal’s Nicole McIntyre sits down with United Nations Development Programme (UNDP) Poverty Division Director Selim Jahan to find out if the G-20’s commitments will result in positive economic change for the developing world in the midst of the financial crisis.
MEDIAGLOBAL: In your opinion, does the G-20 commitment of $1.1 trillion do enough to protect poorer least developed countries (LDCs)?
SELIM JAHAN: I think this a step in the right direction. But having said that, if we look at this $1.1 trillion, $750 billion goes to International Monetary Fund (IMF); $250 billion is for trade financing; and $100 billion goes to the poorest countries. We are concerned that $100 billion may not be enough to stimulate the poorest economies or to have an impact on poverty reduction.
Did you expect a larger amount committed to the poorer countries?
The $750 billion that has gone to the IMF maybe used mostly by the middle-income countries. I was a bit disappointed [as] I thought the resources to poorest countries would increase. Even if you stick to the percentages as they are—if the national income of the developed world goes down, the amount of resources that will go to the poorest countries will go down. Which means that their indebtedness may increase, which [means] they may go back to the IMF. As for trade financing, whether some of the poorest countries will benefit from the $250 billion, I think we have to see how it unfolds.
At the General Assembly President’s recent panel discussion on the impact of the financial crisis, you made the distinction between direct, short term, economic impact on growth and trade, and the long term, human development impact of the crisis. Have the G-20 measures failed to address these longer term, human development impact?
No, I wouldn’t say that they have failed. If you cannot deal with the short-term impact, such as stabilizing the financial sector, you cannot address the long-term impact. Protecting the economy from short-term shocks is a necessary condition. Lots of measures have been proposed in terms of regulation of the banking, tax havens and restructuring of the financial system that are all necessary measures.
But once you go beyond that, you have to ask—how much of these resources do you put for human development promises? For basic social services like health and education? For reducing poverty, malnutrition and hunger? We do not have the answer to that. The large majority of countries in the world have not been part of the G-20 discussions. If you look at their economic structure and the situation they’re in, there’s little elbow room for them to raise the kinds of resources they’re going to need. And those countries will need international support.
What happens to the Millennium Development Goals?
Many people are now saying because of the credit crunch and financial crisis, Millennium Development Goals (MDGs) should be put on the back burner and we should deal with the economic issues first. [But] I think the economic crisis actually strengthens the case for putting more resources for poverty reduction, MDG’s and human development. While the G-20 meeting has addressed the short term necessary conditions, I think that there is much more that can be done in terms of longer term human development.
How has UNDP and the Poverty Group adapted its program to lessen the effects of the financial crisis and address human development issues in least developed countries?
For UNDP and the Poverty Group, we’re trying to deal with human development at the global, regional and country level to address these issues. At the global level we are doing a lot of global impact assessment from the human development perspective. [Evaluating] what is going to happen to infant mortality and maternal mortality for our public advocacy, to make the point that these are some of the human development impact that might be coming in 2010-2011 and we must be prepared for. Secondly, we are remaining engaged in policy debate and dialogue, and doing public and policy advocacy in terms of donors, to convince them that this is a time to provide more resources to LDCs. I’m afraid that we started with the financial crisis, and soon it became an economic crisis, where we have lost jobs and poverty has deepened. But if we cannot handle it properly, it may be a social crisis pretty soon. In countries where the remittances are going down [and] people are coming back – that will create a problem. And with the unemployment going up, the younger people losing their jobs, it can be a social issue.
How are you able to implement comprehensive regional solutions across such a variety of countries?
In every region, the impact, the nature and the dynamics of the crisis is different, given the country condition, the context and their economy. The regional bureaus of UNDP are organizing a series of regional consultations, bringing in the experts who know the issues very well, to talk about how everyone could come together to deal with their particular crisis. We are also using our knowledge network platform to share experiences, [analyzing] what has been the nature of the crisis in other countries, how they have addressed them and whether we can share those policy experiences and the lessons learned to similar situations in other countries.
What kind of feedback are your teams getting from the work you are doing at the national level?
Our major focus is at the country level, because [that is] where the needs are the most. We have a program for UNDP and for the Poverty Group, but in cooperation with each UN agency, we are trying to roll it out as a UN Country Team. One thing we are doing at the country-level is determining the focus areas, asking countries the kind of support they need. Most countries are concerned with the impact of the crisis for [their] economies, the prospects for 2010-2011 and what kind of support the international community is bringing in. The immediate need is to protect the vulnerable. They want to know what kind of programs and protection measures we can develop. In some countries we are helping governments to develop conditional gas transfers, which are very prominent in Latin America and are now growing in Asia and Africa. We are [also] helping some governments develop public works programs to create jobs immediately – not sustainable jobs but to create jobs. In some countries we are developing green jobs — identifying in very concrete terms the areas where you can have jobs, [while] minimizing the impact on the environment.
Do you fund any of the activities?
Yes, the Poverty Group is providing some resources, both human and financial. Our Poverty Trust Fund provides $1.5 million for policy support and impact assessment in some countries. We also have the Poverty Social Impact Analysis, where we are putting in about $600,000 to evaluate and minimize the adverse social impact. I am acutely aware that this is only a very small amount of money, but at least this gives the countries initial seed money to start some of the work that they need doing. Even if it is a small support, at least they feel that we are with them.
With the dynamics of the crisis varying region to region, do you see a greater role for development banks, in their ability to specify a response to the needs on the ground?
In earlier crises, regional development banks (RDBs) played a major role in supporting countries, [so] I definitely see a role for them. RDBs have the resources and the ability to implement them in that particular region. Even with donors there is an interest in region specificity. For instance, Japan just approved $5 million in official development assistance (ODA) but only for Asian countries. The RDBs can mobilize some of the major players in every region to get the kind of funding that is needed.
Climate change seemed completely absent from the G-20 agenda. Should there have been a greater effort to include climate change in those discussions given the necessity of reaching a consensus in Copenhagen in December?
It’s not a question that we should focus on climate change right now, but we should recognize the linkages of climate change to the crises. Take the whole issue of food security, which we are only analyzing in terms of volatility of prices. Farmer’s productivity, acreage and irrigation could depend on climate change, considering [the levels] of desertification, deforestation and rainfall. In the ultimate analysis, food production and rural unemployment, particularly in agriculture, are very much linked to climate change and food security. It’s not an issue on that we have to focus in this particular meeting, but we should recognize the linkages. My fear is that sometimes we put these things as either-or questions—should we go for development financing or poverty reduction or climate change? But these are different faces of the same problem. We have to have an integrated approach given that the funding is limited.