The triple threat of the global economic recession, volatile food and fuel prices, and bearing the brunt of the world’s natural disasters has hit countries in the Asia-Pacific region particularly hard, a new United Nations report warned today.
With almost two-thirds of the world’s poor and half of its natural disasters, the region is at the epicentre of these crises, according to the report by the UN Economic and Social Commission for Asia and the Pacific (ESCAP).
The report, entitled “Addressing Triple Threats to Development,” noted that record high oil prices in 2008 of $147 dollars a barrel, in combination with hoarding and price speculation drove the price of rice – the region’s staple – up by 150 per cent, hitting the poor the hardest.
At the same time, another ESCAP report showed that almost a quarter of a million people died in 2008 as a result of natural disasters in the region, representing 97 per cent of fatalities worldwide.
“The converging triple threat highlights the need for a more comprehensive, inclusive approach to development,” stressed ESCAP Executive Secretary Noeleen Heyzer.
“Not only is there an urgent requirement to resume economic growth, but we have to re-think where that growth takes place and whom it benefits,” added Ms. Heyzer.
Prudent macroeconomic policies, implemented in reaction to the previous economic crisis which swept the region in 1997, bolstered the Asia-Pacific at the beginning of the current slump. However, that resilience started to erode, when in the fourth quarter of 2008, trade – the region’s engine of growth – moved from double digit growth to double digit declines.
Among the reasons for this reversal in trade is that the region’s economy is more integrated with the rest of the world than with itself.
Ms. Heyzer noted that “intra-regional trade among developing countries accounts for only 37 per cent of exports in our region, compared with NAFTA [North American Free Trade Agreement] at 51 per cent and the EU [European Union] at 68 per cent.
“By strengthening our domestic markets, the region can provide a buffer to global market fluctuations and move from being crisis resilient to crisis resistant. A key component in this will be how governments use fiscal policy as a tool of development.”
The Survey calls for more intra-regional trade and investment by accelerating the implementation of regional economic cooperation agreements, as well as improved basic social protection. Currently only an estimated 30 per cent of the elderly receive pensions and 20 per cent of the population have access to health-care assistance.