Asia Must Promote Employment, Support Those Without Decent Jobs, ADB Says

HA NOI, VIET NAM - Creating the conditions for good jobs and, more importantly, social protection programs for those unable to find decent work is an urgent priority for governments in Asia and the Pacific, Asian Development Bank (ADB) Vice-President Ursula Schaefer-Preuss told a conference in Ha Noi, Viet Nam, today.

Speaking at the conclusion of a three-day conference titled "The Impact of the Global Economic Slowdown on Poverty and Sustainable Development in Asia and the Pacific," Ms. Schaefer-Preuss said that the recent global economic downturn has cut demand for the exports on which the region’s economies depend, forcing job cuts in many of the industries that send their goods overseas and slashing the incomes of thousands of people in the region. Many may struggle to find alternative employment.

"Before the crisis – in the context of high growth rates – only about half of the region's young labor entrants could find decent jobs, while the rest had to sustain themselves and their families through the informal sector," said Ms. Schaefer-Preuss. "The need for social protection strategies to address the post-crisis labor market becomes more urgent with the prospect that growth rates may not reach the levels of just a few years ago."

The conference, organized by the ADB, together with the governments of Viet Nam and the People's Republic of China, the ASEAN Secretariat and nine development partners, saw over 350 representatives from ADB, regional governments, civil society, intergovernment organizations and academe discuss the social impact of the global crisis and the need for social policy reforms.

ADB earlier this month forecast that the economy of developing Asia will grow 3.9% this year, a sharp slowdown from the average 8% growth seen in the five years before the crisis. ADB expects the region to expand 6.4% next year. The slowdown in growth from pre-crisis levels means that at least 60 million Asians will fail to escape poverty this year.

Unlike the Asian financial crisis of 1997-1998, which particularly hurt those below the $1.25 a day poverty line, the latest global slowdown has hit hardest the "near-poor" in Asia and the Pacific, who live on around $2 a day. Those suffering most include the urban youth and, in some countries, young women who made up a large portion of the workforce in certain export industries such as the garment and high-technology sectors.

Participants also stressed the need to improve the deteriorating physical environment of the region’s poor. Pressure on natural resources, notably in rural areas, is also degrading the environment that low-income groups depend on. Climate change, bringing higher sea levels and extreme weather events, is exacerbating the problem.

Conference participants urged governments to swiftly improve social safety nets through more effective targeting and direct more spending to areas such as improving access to education and investing in maternal and child health. Governments need to promote decent employment and improve the conditions for those outside the formal labor market. Since the challenges vary from country to country, however, governments will need to tailor their responses to their specific circumstances. Only by addressing these issues, will the region's growth become both inclusive and sustainable.

About ADB