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p. 3 of 18 BACK | NEXT I. Introduction II. Overview of Social Protection A. Social Risks and Social Protection B. Characteristics of the Asia and Pacific Region C. The Components of Social Protection D. Social Protection Systems in the Asia and Pacific E. The Experience of ADB and Other Aid Agencies III. Priorities for Social Protection IV. Operational Implications V. Recommendation

Social Protection Strategy : II. Overview of Social Protection

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A. Social Risks and Social Protection

5. The Asian and Pacific region has half the world's population. Of the total 3.1 billion, 900 million are poor (30 percent), and 1.2 billion are children and youth (40 percent). Thus, a main development challenge for the region is to achieve sufficient sustainable growth to secure the inclusion of the poor and young new entrants in the development process. However, growth alone is not a sufficient condition for generating inclusive societies. Populations, households, and individuals face various risks that can plunge them into poverty, so societies have to take steps to reduce their vulnerability and to cope with the effects when shocks occur. Risks may include natural disasters; civil conflicts; economic downturns, of which the 1997 Asian financial crisis is the most recent example; or idiosyncratic household reversals, such as crop failures, unemployment, illness, accident, disability, death, and old age, threatening the future of the household and its members. Development interventions may themselves create new vulnerability and risks through involuntary effects such as less affordable goods and services, temporary job loss, loss of common property, displacement, and loss of community support networks and social capital.

6. Generally, four main types of risk to the poor can be identified:

1. those related to the individual lifecycle
2. economic
3. environmental
4. social/governance related (Table 1)

Some risks affect all population groups equally; others have more intense impacts on the poor. The poor are highly vulnerable to risks and are constantly preoccupied with risk-averse and coping strategies to avoid sinking further into poverty. Social risk is a dynamic concept—insecurity means exposure to risks of events that if they occur, result in further vulnerability. While anyone can be vulnerable, the poor and the near poor are particularly at risk since they have fewer assets, reserves, or other opportunities to fall back on.

7. There are many risk reduction mechanisms, formal and informal, public and private sector delivered. Table 1 shows some of the informal strategies to cope with risk; many rely on community arrangements and women's support. However, as urbanization and industrialization gradually undermine the effectiveness of traditional and informal protection mechanisms, new public and/or private systems need to be put in place to reduce risks to the population. Social protection presents a variety of instruments to deal with the diversification of most of these risks. The long-term solution to vulnerability depends on good social and economic development decisions that address the structural causes of vulnerability. Development policies should therefore (i) involve proactive interventions to reduce vulnerability and support populations to overcome poverty; and (ii) try not to alter existing informal family and community-based mechanisms to cope with risk, given that these provide a level of social protection to the population, and when possible, encourage community-driven interventions (social funds, microinsurance, etc).³

8. The large variety of risks is not addressed through social protection alone. Social protection is not the entirety of development activities. Social protection instruments are generally not considered for risk reduction; for this, other instruments are available. Sound development policies and investments are ways to reduce the probability of or even eliminate such risks (e.g., infrastructure investment for flood control). Social protection programs are built primarily to mitigate the impacts of shocks or to help people cope with risks if they occur. The boundaries between social protection and related activities are somewhat arbitrary and have to take account of regional characteristics and practical links to distinct and well-established disciplines such as education, health, and agriculture. With these considerations in mind, ADB has developed a definition of social protection based on labor markets and small-scale agriculture, in line with ADB's overarching goal of reducing poverty in the Asia and Pacific region.

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