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p. 6 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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D. Social Protection Systems in the Asia and Pacific Region

20. The experience of the Asia and Pacific region has been diverse in the past, and the motivations and approaches for future reform differ from one country to another. Generally in South Asia, Southeast Asia, and the Pacific most of the debate has focused on expanding coverage and identifying financing sources to fight poverty and provide long-term protection to the population. In transition economies, the focus has centered on adjusting existing systems to a market economy.

21. As shown in Table 2, most DMCs have some form of institutionalized social protection system, but often these programs are ineffective due to (i) limited coverage, serving only a portion of the formal sector (often the wealthiest segments of society); (ii) insufficient funds, incorrectly distributed among programs; (iii) inadequate instruments, often copied from developed countries but not appropriate to serve specific in-country needs; and (iv) factors restricting access to statutory social protection schemes, such as legal restrictions, administrative bottlenecks, and problems with compliance.

1. In considering the demands for social protection within Asian subregions it is important to identify the circumstances faced by their vulnerable groups. Table 3 summarizes the social protection priority issues by subregion. The countries of East and Southeast Asia are still recovering from the regional financial crisis and high levels of unemployment, and need substantial investments in social protection to overcome poverty and reduce social risk and vulnerability. The transition economies, Central Asian republics, People’s Republic of China, Viet Nam, and (to a lesser extent) Cambodia and Lao People’s Democratic Republic, are restructuring and consolidating their systems to a market-oriented society; existing state-funded and state-controlled social protection schemes are being dismantled, reformed to adjust to reduced budgets, and made more flexible to labor market changes. South Asian countries (Bangladesh, India, Pakistan, and in a lesser degree Sri Lanka) have large proportions of the rural population living in poverty with high levels of illiteracy, and state-funded social protection schemes exist only nominally and are supplemented by some limited programs operated by NGOs. The region needs substantial investments in social protection and human development targeted to children and the informal sector and truly vulnerable groups. The Pacific region presents a variety of experiences, with some countries having developed social protection systems and others still to do so. A common trait to all countries in the region is the need to address child and youth priorities, extend coverage to poorer communities, improve governance, and promote institutional development. In general, all subregions have reduced expenditure on social protection schemes in the last decade in an attempt to balance budgets and achieve macroeconomic stabilization. Since the Asian Crisis, the effect has been to increase poverty, insecurity, and social exclusion for many vulnerable groups.

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