What are governments doing about the global crisis? New country case studies

June 17, 2009

     By Duncan Green     

The ODI continues to churn out some useful country research on the impact of the crisis. For a synthesis paper of its findings so far, see here. Or see the individual country case studies on Bangladesh, Bolivia, Cambodia, Indonesia, Ghana, Kenya, Nigeria, Uganda and Zambia.

Most of the findings are by now fairly familiar – falling investment, stock markets, trade, remittances, leading to expanding fiscal deficits and worries about cuts in social spending. The most interesting section was perhaps that on what governments are doing to respond to the crisis through social protection. Some excerpts:

‘Across the case study countries, social protection provision is piecemeal and fragmented, with low levels of coverage. However, during the past five years, national social protection strategies have been adopted in most of the case study countries. The extent to which these plans have been adapted in response to the changing needs resulting from the crisis varies significantly. Some countries are struggling to protect funding for existing commitments in the context of severely constrained government budgets, whereas others are attempting to extend coverage. Cambodia has already initiated new programmes, and Ghana is attempting to expand its existing programme in order to mitigate the effects of the crisis, both with the support of emergency World Bank funding.

Social protection provision has low coverage in all the case study countries, tending to be inequitably distributed, assisting only a small percentage of the poor and offering disproportionate support to those in formal employment, particularly government employees. Evidence of significant increases in coverage (in terms of percentage of the poor covered) in response to the crisis is scarce, with only Cambodia and Bangladesh reporting significant programme expansion during 2008 and 2009, although in the case of Bangladesh this expansion was planned largely prior to the onset of the financial crisis. Elsewhere, social protection provision has either remained largely unchanged from what it was prior to the crisis, or the increases in coverage have been marginal. In part, this is likely to owe to the fact that large-scale impoverishment arising from the crisis is not yet politically visible in many of the countries.

While the crisis has not yet resulted in major social protection policy revisions, or a large-scale expansion of social protection provision in most countries, a number of pre-existing programmes have been extended and new programmes introduced, albeit on a modest scale. The major types of interventions selected to date are food subsidies and rationing (Indonesia and Bangladesh), food distributions for vulnerable groups and school feeding programmes (Cambodia, Indonesia, Bangladesh, Ghana, Kenya and Nigeria), in-kind transfers offering fertiliser (Kenya), cash transfers (Ghana), education scholarships and subsidies (Cambodia and Ghana) and public works programmes (Cambodia, Indonesia, Bangladesh).’