Africa

To Enrique González Rojo (1928-2021), friend, comrade in many struggles, admirable poet, and Marxist thinker

By Saul Escobar Toledo
MEXICO CITY, Mar 26 2021 (IPS)

A compilation of testimonies collected by Blanca Velázquez Díaz and published by the Ebert Foundation (available at: http://library.fes.de/pdf-files/bueros/mexiko/17328.pdf) offers an account of the harsh reality by which some workers of the maquila industry in the Mexican state of Morelos have gone through over these last twelve months. Their words reflect, undoubtedly, similar experiences of millions of workers in different parts of the country.

Saul Escobar Toledo

The author explains the interviews were conducted by phone in mid-2020; the workers´ ages range from 20 to 40 years; their level of education is elementary and middle school; they come from the countryside or small urban communities where there are few chances to get a job, so they move to the larger cities of the State of Morelos, where the maquiladoras are set to produce for major brands belonging to international consortia.

Their working conditions were already very unfavorable: in the textile sector and specifically in the branch of clothing and footwear, working days exceed eight hours a day, time in which they are permanently seated in non-designed chairs ergonomically, supporting extremely high temperatures in closed places with little ventilation.

The spread of COVID-19 made matters worse. Mainly, the bosses of the maquilas in Morelos did not respect the official recommendations and opted for the dismissal of their employees or cut half of the wages they received weekly.

For example, a worker identified as Lili said, “The company is paying me 280 pesos (14 dollars) a week …” while another, Anita says, “I am now working cleaning houses, the truth is that $ 400 pesos (20 dollars) the factory is giving me now is not enough”. Other interviewees indicated that they have received half of their salary.

Vicky: “Getting only half the salary the situation is bad, what am I going to do with only $ 400 pesos a week? that’s tough for me, and the company has us on hold, no one knows when I will get back to work … ”

Some more, a little luckier, affirmed that “From April 3 they sent us to rest with a base salary, which is really very little, 833 pesos (41 dollars) a week …”

There were also cases in which the workers decided to stop working so as not to get infected, and were fired:

Brenda: “… the company chose me to continue working on contingency days, but I saw that several colleagues went home sick with symptoms of COVID-19 and that was why I decided not to expose myself to the Coronavirus, my supervisor was terribly angry with me for making that decision, but I was sure that what I had decided was the right thing to do, to stay home and protect myself. Now I am fired, I was no longer called. ”

Almost all confessed going through a very tense emotional situation:

Justina: “Well, personally in the mental sphere I want to take things easy, but it is a bit impossible when I watch television or social networks, since they are flooded with what is happening in the pandemic and with bad news. They have been very outrageous at the time of reporting, I think that’s why, so sometimes I can’t get to sleep … ”

Finally, the workers were questioned about government aid. All answered they did not receive any support from the federal, state, or municipal governments:

María: ” No, at least nothing to me, I only remember that once the assistant of the mayor of the municipality (Emiliano Zapata) was distributing pantries, but they had a cost …”

Vicky: “Oops! nothing, not a glass of water …! ”

Anita: “The truth is, nothing, at least not even a pantry has arrived here in my neighborhood. ”

The author of the compilation concludes that, according to the testimonies collected,

“The more important consequences (observed) were unjustified dismissals … during these months of health emergency. The major concern of workers is how to generate an income … since the current employment situation looks increasingly difficult. Their mental and emotional health is in constant tension…, especially due to the low economic resources to support their families; besides, they are fearful about the possible spread of COVID-19 when they must exit their homes and go to the streets looking for an (extra) income … Add to this situation the double and triple work burden. Home education of their minor sons and daughters is generating many more hours of work for them. The care, especially of children, continues to fall primarily on women, just because they are females, with multiple responsibilities and little or no help from their partners, a situation that has led to stress, worry, anxiety, and insecurity, to mention some consequences ”

Another important piece of information refers to the behavior of the unions. According to the testimonies collected, Blanca Velázquez assures that in normal times the unions do not defend their affiliates; neither they have done in times of pandemic since they abided unashamedly business decisions and left the worker abandoned to their fate.

Finally, the text calls our attention about the almost total absence of the Mexican State in this situation, particularly the federal government. Rightly concludes the author of this collection, that:

“The social programs that the federal government has promoted for particular sectors, especially vulnerable ones, should be expanded for the workers laid off or when the bosses did not comply with the full payment of wages. We believe that programs for people who were laid off should be promoted immediately or, failing that, (legislate) unemployment insurance to alleviate this serious situation and train those who require it to be able to be employed in other trades or professions”.

Millions of wage earners have been deprived of any help and it has had a high social cost and become an obstacle to economic recovery. It is difficult to understand the reasons that led the government to this oversight. Perhaps they expected companies would pay total wages or that layoffs could be resolved quickly. However, it was likely that they did not, as indeed happened, due to the behavior of many companies in the past decades, as they have constantly violated labor laws and promoted lack of representative trade unions, especially in industry of maquila.

The absence of a worker protection policy during the pandemic seems to be due rather to an economic project based on budget cuts and austere public spending that does not admit emergency measures. The testimonies collected in the book show the unfortunate effects of these decisions. Waiting for the US economy to be the main factor in the recovery may be successful in the coming months. However, it will not correct the damage done to working class families. Nor will boost employment if it is not accompanied by other measures, such as unemployment insurance and promotion of domestic production and consumption.

The words of grief and pain shown in this publication are a very expressive testimony of what the Government of the Republic could have done (as in other countries and even in Mexico City) but refused to do.

Saul Escobar Toledo, Economist, Professor at Department of Contemporary Studies in INAH (National Institute oh Anthropology and History, México) and President of the Board of the Institute of Workers Studies “Rafael Galvan”, a non-profit organization. His recent work : “Subcontracting: a study of change in labor relations” will be published soon by Friedrich Ebert Stiftung, Mexico City.
saulescobar.blogspot.com

 

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The post Maquila Female Workers in Their Own Words: Fighting COVID and Labor Abuse appeared first on Inter Press Service.

Excerpt:

To Enrique González Rojo (1928-2021), friend, comrade in many struggles, admirable poet, and Marxist thinker

The post Maquila Female Workers in Their Own Words: Fighting COVID and Labor Abuse appeared first on Inter Press Service.

A 3-0 win in Niger for Ivory Coast sends the Elephants to Cameroon with a game to spare.

Rwanda has long accused France of complicity in the 1994 mass killings.

There is growing international pressure on Ethiopia to end fighting that has displaced thousands.

By Rosi Orozco
MEXICO CITY, Mar 26 2021 (IPS)

In March 2014, Noemi N. took her own life inside a refuge camp in Ciudad Juarez, Chihuahua, where up until now there are no specialized shelters for victims of human trafficking.

Noemi N hung herself with a shower curtain around her neck after being rescued from a migrant smuggler who took her to be sold in the US without any personal documents. She was only 8 years old.

Rosi Orozco

Her death started a news wave about the victim shelters in Mexico where the most conservative figures indicate 120,000 new human exploitation victims each year, mainly girls and women.

The Mexican criminals who lead this racketeering are as varied as they are dangerous. They compose of 47 groups, ranging from entire families dedicated to sexual exploitation to the most powerful cartel in the world, Jalisco Nueva Generación, considered as the most important touristic destinations encouraging sexual tourism.

The criminals create a spike in victims, while the country suffers a shortage of safe places where the victims can be protected, can seek justice and start a new life. Only four Mexican states have a government specialized shelter.

These government buildings often run with a limited budget and reduced staff capacity who work extra hours to attend to the 1% of victims who manage to flee from their captors and survive to tell their story.

The rest of the Mexican shelters —about 10— are administrated by non-governmental organizations that go to enormous lengths to keep them open and staffed through donations and lotteries.

Comisión Unidos Vs Trata and Fundación Camino a Casa are pioneering civil organizations in the creation of these safe spaces. Their shelters have housed more than 300 survivors since 2007 and they do not rely on governmental funds.

In Mexico, the last three federal administrations have been held by three different political parties: the conservative Acción Nacional, the centrist Revolucionario Institucional, and the leftist Morena.

Due to these political changes, an economic model that requires money from the government would make shelters dependent on each election campaign.

Only the independence of political power guarantees that these safe spaces remain open every day of every year, regardless of any events including the elections.

However, that freedom has its costs. Sometimes very high costs. For example, human rights defenders who run shelters never know exactly how much they will be able to raise each year and whether that money will be enough to cover the basic needs.

Each survivor requires an investment of about $ 900 per month for food, clothing, legal services, medical and psychological fees, school assistance and some recreation or fun.

Also, other costs vary according to each victim: Comisión Unidos Vs. Trata and the NGO Alas Abiertas have arranged free reconstructive surgeries for Zunduri, tortured at a dry cleaners; the purchase of two vehicles so that Erika and Estrella, forced into prostitution, could have an income by driving taxis; or the salary for one of the best activists in the world, Karla, who survived more than 43 thousand rapes since she was 12 years old.

And, of course, there is the safety issue. A shelter is the last barrier between a victim and a perpetrator. It is where a victim recovers, gets healthy, empowered, speaks up and decides to start a judicial investigation against her perpetrator.

That is why shelters are targeted by organized crime. Criminals locate the houses, watch over them, stalk those who go in and come out of there, chase up to the courts and send death threats expecting that the walls that protect their victims are pulled down or demolished.

The risk also extends to the legal field of those who manage the shelters. These are places where users have a high chance of committing suicide, physically assaulting the staff who care for them… even sexually assaulting other survivors.

These are complex, but also wonderful spaces. Without the shelters, it would be impossible to have more than a thousand sentences against human traffickers, especially in Mexico City and the State of Mexico, where authorities have done an extraordinary job keeping shelters open, despite the difficulties and repeated violence.

This month, the Secretary of the Interior of the Mexican government, Olga Sánchez Cordero, made a historic announcement: the current government will seek greater ties with civil society shelters to advance in the defense of human rights.

The frequent visits from the government to oversee the daily operations of these shelters give hope and open a new chapter in the cooperation between authorities and activists.

For this reason, millions of us dream of opening a shelter in each entity of the country, due to its incalculable value for a country that yearns for peace and justice.

The author is a human rights activist who opened the first shelter for girls and teenagers rescued from sexual commercial exploitation in Mexico. She has published five books on preventing human trafficking; she is the elected Representative of GSN Global Sustainability Network in Latin America.

 

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The post A Country with too Many Victims and Few Shelters appeared first on Inter Press Service.

Francis Ngannou says he wants to "prove anything is possible" as he looks to become the UFC's first African-born heavyweight champion in Stipe Miocic rematch.

A day in the life of a coffee grower during harvest season. Credit: Those Coffee People

By Jennifer Poole*
MEDELLIN, Colombia, Mar 26 2021 (IPS)

It’s been just over a year since the Colombian government launched its landmark price stabilization fund. With a budget of $64 million, the fund was designed to provide a hedge against low prices by subsidizing farmers during periods when prices dropped below production costs.

The reason for its introduction was due to the torrid times the nation’s producers had been through during the latter half of the last decade, where wholesale prices regularly dropped below the cost of production. So the fact the fund launched just as COVID-19 was beginning its stranglehold on the global economy was pure luck. But as luck goes, a government underwriting your industry just as the economy comes to a grinding halt is pretty fortunate.

However, far from the stabilization fund needing to be triggered almost as soon as it was launched, in order to mitigate the fallout of COVID-19 – the last 12 months have been a bumper year for Colombian coffee producers. The reasons for this are paradoxically partly due to COVID and partly due to other unforeseen circumstances.

The Coffee Price Stabilization Fund in Context

Although Colombia is the world’s third-biggest coffee producer, production is extremely fragmented. The traditional family-owned smallholdings, known as fincas, have remained virtually intact since the birth of the industry. This has resulted in more than half a million privately owned coffee-producing fincas in the country, with approximately four million Colombians relying on these for their livelihoods.

Most of these fincas don’t produce enough to sell directly to buyers, so they instead sell their beans to the growers-union, the Federacion Nacional de Cafereros de Colombia (FNC). The FNC offer growers a floating internal buy-rate, determined by global wholesale prices, and then sell the produce on international markets.

The problem has been that the floating buy rate offered by the FNC dropped below the cost of production numerous times between 2016 and 2019, with prices falling to their lowest in nearly a decade in the 2018-19 harvest. This meant growers were selling at a loss, with many abandoning the industry altogether.

The Internal Buy Rate Since the Onset of the Pandemic

The FNC floating buy rate had been trending upwards since the middle of 2019 as price recovery took hold after the nadir of the 2018-19 harvest. However, as the below graph shows, the buy rate exploded in March 2020, just as the pandemic took hold, with the price increasing to COP 1,143,193 (USD $319), a 29% increase versus January 2020. And while the price has fluctuated since then, it’s remained extremely buoyant.

To put this into a broader context, the value of coffee production in 2020 was USD $2.52 billion, which equates to a 25% increase on the 2019 figure of USD $2.01 billion.

Graph data courtesy of the FNC’s “coffee prices, area and production” report

The price spike was partly due to the complete collapse in demand for oil in March 2020. With Colombia being an oil-producing nation, the Colombian peso suffered a near 20% drop in value versus the dollar. And with the FNC collecting payments from buyers in dollars, it was able to arbitrage this difference and pass on much of the increased value to growers.

To add to this, Colombia also gained an advantage against its nearby coffee-producing competitors, such as Brazil, which suffered from excessive rain and little solar light in the first trimester of 2020, meaning the country’s coffee harvest was badly affected. There were also fewer coffee exports from Central America due to low manual labor availability. All of these factors created a supply squeeze, both real and feared, which helped to sustain higher prices.

Production and Export Volumes

Colombia wasn’t completely spared some of the inclement weather suffered by its neighbors over the last 12 months. Delayed starts to the rainy seasons as well as the ever-present danger of the broca bettle made a bit of a dent in total production, being 4% down YoY.

Graph data courtesy of the FNC’s “coffee prices, area and production” report

However, a more noticeable impact has been the reduction in export volume over the last 12 months, as global demand reduced slightly during the pandemic. According to the FNC, Colombian coffee exports fell by 8% last year, dropping from 13.7 million 60kg bags in 2019 to 12.5 million 60kg bags in 2020.

Within this context, the fact the value of coffee production grew by 25% YoY in 2020, in spite of the fact export volume fell by 8%, shows just how significant this price rally has been for the nation’s smallholders.

Looking Ahead

Despite the historically high FNC buy rate, this is no reason for producers to become complacent. A unique once-in-a-generation set of circumstances conspired to push prices up to new highs, and for the time being, at least, keep them there.

A worry is that this unexpected bonanza being enjoyed by growers could disincentivize many from making the switch to higher-value specialty crops, which is a key development objective of the FNC. Switching from commercial grade to specialty comes with plenty of risks, which are compounded during a pandemic. And all the while, the FNC is offering record prices for regular commercial-grade crops.

So while it’s impossible to predict when prices may fall to below production costs, recent history tells us we shouldn’t write this off at any point. Add to that the unpredictability of climate change and the longtail impact of COVID which will impact markets in ways not yet foreseen.

And when it comes to the growers themselves, there are still barriers to their economic security in rural areas of Colombia to take into account — such as a lack of connectivity and food insecurity — which mean that if the market situation changes in the near future, they have very little to fall back on, and the price stabilization fund will be needed. But with this novel mechanism remaining untested, its ability to provide a much-needed safety need remains unproven.

*Based in Medellin, Colombia, Jennifer Poole spends her time traveling to remote towns and villages in search of the best specialty coffee the country has to offer. She is an international economist with work experience in North America, South America, East Africa, Southeast Asia, Europe and the Middle East. She received her MBA from IDRAC Ecole Superieure de Commerce in Lyon, France and is heading Those Coffee People’s international business development.

 

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The post A Look at Colombian Coffee Prices One Year on From the Stabilization Fund appeared first on Inter Press Service.

Excerpt:

The writer is the co-founder of Colombian specialty green coffee supplier Those Coffee People.

The post A Look at Colombian Coffee Prices One Year on From the Stabilization Fund appeared first on Inter Press Service.

The Gambia qualify for their first Africa Cup of Nations when beating Angola 1-0, joining Comoros, Gabon, Ghana, Egypt, Zimbabwe and Equatorial Guinea in qualifying on Thursday.

Thousands of young people took to the streets earlier this month, in anti-government protests.

Islanders Comoros make history when drawing with Togo to qualify for the Africa Cup of Nations for the first time.

The ivory trade and habitat loss combine to push Africa's elephants closer to extinction.

Four passengers were taken out of buses after an apparent ambush and shot dead, MSF says.

World Food Programme Deputy Executive Director Amir Abdullah says that no matter how much improvement is made in food production, it will all be futile unless the issue of water security is addressed. He said humanitarian and food aid can never be enough to manage cascading climate shocks. Credit: Isaiah Esipisu/IPS

By Samira Sadeque
UNITED NATIONS, Mar 25 2021 (IPS)

The intersection of crisis, climate change and COVID-19 has resulted in a “rapid rise in hunger”, according to United Nations World Food Programme (WFP) Deputy Executive Director Amir Abdullah.

He was speaking at the “Building Food and Water Security in an Era of Climate Shocks” event organised by the UN Department of Economic and Social Affairs (UN DESA). The meeting featured representatives from other UN bodies, farmers’ associations and startups working on water security and agriculture around the world.

Abdullah highlighted the numerous disasters that hit globally last year while the world was in the middle of the pandemic: destructive heat waves, wildfires, floods, storms, and locust outbreaks.

“Humanitarian aid can never be enough to manage these cascading shocks that keep breaking down food systems and pushing people into food and water crises,” he said.

He added that no matter how much improvement is made in food production, it will all be futile unless the issue of water security is addressed.

“We can deliver food assistance but if farmers don’t have adequate access to water resources for food production, people will just continue being hungry,” he said. “And if people don’t have access to clean water, they can’t retain the nutrition they need even if we provide them with food assistance.”

Betty Chinyamunyamu, CEO of the National Smallholder Farmers’ Association of Malawi, said the past decade has witnessed an “onset of weather crises” which have made it extremely difficult for farmers to plan their sales.

“Increased incidences of new pests, diseases and unpredictable weather patterns make it more difficult for farmers to plan their farm enterprises. So when they’re not sure whether they are going to have a flood or whether they are going to have drought, it becomes very difficult to engage in initiatives that would otherwise be very rewarding for them,” Chinyamunyamu said. 

“That unpredictability of weather is really making agriculture less profitable for the farmers,” she added.

Cherrie Atilano, CEO and President of AGREA, which works to ensure fair trade in sustainable agriculture in the Philippines, brought up the importance of collaboration between the private and public sector. She pointed to an example that worked in the Philippines at the beginning of the pandemic.

Just a few days after the first lockdown, many farmers were left wondering where to take their produce, as their mobility had suddenly been restricted, she said. At the same time, in Manila, the country’s capital with a population of more than 12 million, people scrambled for groceries as supermarkets shelves were empty.

Her team addressed this by contacting the agriculture ministry asking for farmers’ access to work to be restored so long as they maintained COVID-19 protocols.

Meanwhile, Chinyamunyamu shared the role that digital platforms and innovative technology played during the crisis, especially in giving access to marginalised groups.

The lockdown was especially disruptive for the farmers in Malawi, because it came at a time which was the “only marketing season” for them, she said. Chinyamunyamu explained that farmers were able to address this challenge through innovative approaches, including using digital technology such as mobile phones

Farmers were able to share information with each other on markets, as well as developments about COVID-19 by communicating via mobile phone. This was especially important for marginalised groups because it established an important way to reach vulnerable communities.

“Even though women still have less access than men to mobile phones, if a woman has a mobile phone, it’s theirs — they have control over the usage,” she said. “So if you pass on information to women through mobile phones, that’s information that goes directly to them.”

However, concerns remain about what lies ahead.

“In the coming decades, many regions around the world are expected to experience increased water scarcity driven by climate change and exacerbated by increasing competition for water resources,” Abdullah said. 

“The battle for water will be one of the next ‘great challenges,’” he added.

Samir Ibrahim, co-founder of SunCulture, a startup for solar-powered generators and water pumps in Africa, shared his experience working with innovative technology on the continent.

He pointed out that new ways for the allocation of funds was crucial for the sustenance of such projects.

“What is important for the ‘newness’ is not necessarily new technologies,” he said. “What we’ve seen is that emerging markets were solving problems that have been solved in other parts of the world.”

He said that while their company did not invent solar irrigation, it was “the first to commercialise in Africa”.

“While technology is incredibly important, we had to do a lot of innovation on battery storage,” he added.

Related Articles

• Water Governance and Data Collection is Key to Reach Development Goals
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• Cuba Prioritises Sustainable Water Management in the Face of Climate Challenges

The post Humanitarian & Food Aid Can Never be Enough to Manage Cascading Disasters appeared first on Inter Press Service.

Japanese firm Shoei Kisen Kaisha says dislodging the Ever Given is proving "extremely difficult".

By External Source
Mar 25 2021 (IPS-Partners)

This short video explores the experiences of COVID-19 in Fiji’s capital, Suva, by University students. The participants reflect on the impact of the virus in the Pacific nation, where themes such as the emotional implications of COVID as well as its effects on the economy, food security, resilience and more are discussed.

They remind us that despite all the negativity that the virus has brought, one has to be hopeful and resilient about the future.

The participants, all students at the University of the South Pacific, are Salote Nasolo (postgraduate student in climate change), Ratu Simione Matanitobua (undergraduate student in land management) and Peni Turagabaleti (postgraduate student in land management).

The video was shot and edited by Tom Vierus / Pacific Media House, and the interviews were conducted by Gregoire Randin.

www.pacificmediahouse.com
www.tomvierus.com

Source: The Pacific Community (SPC)

The post „We will overcome it“: Experiences of the impact of COVID-19 in Suva, Fiji appeared first on Inter Press Service.

Agaezichi Joy is challenging stereotypes as a mother with spinal muscular atrophy.

The "priceless" work in Aberdeen is described as having been looted by British soldiers in Africa in 1897.

Credit: Temilade Adelaja via Communication for Development Ltd/CGAP, Washington DC

By Elisabeth Rhyne* and Eric Duflos*
WASHINGTON DC, Mar 25 2021 (IPS)

Imagine it is 2025 and that, unfortunately, another pandemic is sweeping the world. Much like in the 2020 crisis, borrowers have seen their livelihoods upended and are struggling to repay loans.

One of the questions before policy makers amid this new crisis is whether to extend moratoria to distressed borrowers. In search of answers, they reflect on the world’s experience with the COVID-19 pandemic and whether moratoria were part of the solution. These policy makers conclude that they did some things right in 2020.

Just days into COVID-19 lockdowns, bank regulators in more than 115 countries granted special permission for financial services providers (FSPs) to extend moratoria to millions of borrowers, especially those with small business and consumer loans. These moratoria were the next best thing to cash in the wallet for borrowers who had lost their jobs or seen their business revenue plummet.

For lower-income countries, whose governments could ill afford welfare payments, moratoria became an important form of economic relief. And by relaxing provisioning on paused loans, these special moratoria also shored up FSPs’ balance sheets and prevented panic in financial systems.

Through the moratoria, the world’s economies put the shock-absorbing capacity of financial systems to good use.

But these policy makers also see that moratoria could have worked better in some respects. So, in 2025, as the world once again turns to moratoria, they are determined to learn the lessons of the past and make moratoria work even better. What do they do differently?

Fair burden sharing

As public health authorities shutter the economy to stop the new pandemic, advocates for lower-income people are already calling on policy makers to spread the economic burden among those better able to bear it.

Policy makers know that moratoria on small loans (as well as evictions and mortgages) will shift some economic pain from lower-income families and small businesses onto banks and landlords — at least, temporarily.

But they recall that, in 2020, FSPs shifted the pain back to small borrowers by allowing interest to accrue and compound during moratoria. Ultimately, borrowers paid to pause their loans – often dearly.

Back in 2020, policy makers debated whether to shift some of the long-term burden of accrued and compounding interest away from borrowers, but it was difficult for them to find a workable solution.

In India, after much debate in the Supreme Court over who should pay this additional interest, the government found a remedy when it agreed to pay banks the compounding portion of borrowers’ interest incurred during moratoria. Implicitly, this decision made moratoria part of the government’s overall pandemic response while affirming the right of the banks to charge fully for delayed payments.

Fortunately, in 2025, several governments have included special provisions in their catastrophe protocols that pledge government funding for a portion of the interest that small loans accrue during moratoria.

This pledge helps to ensure policies intended to help low-income people don’t end up harming them. It has the added benefit of providing banks with a small amount of liquidity during the moratoria period.

Moratoria will also be fairer this time around because policy makers have universally agreed that borrowers should have the right to choose whether to accept or reject a moratorium offer. This was not always the case in 2020.

In some countries, regulators — anxious to prevent panic — and FSPs — wishing to avoid tedious case-by-case administration — promulgated blanket moratoria, even before obtaining agreement from borrowers.

However, some borrowers preferred to keep paying to avoid extra interest charges. In response to push back from borrowers on unilateral moratoria, authorities in Peru affirmed consumers’ right to unwind unwanted moratoria. Today, following this example, regulators the world over require FSPs to notify borrowers of moratoria offers and present them with the option to refuse.

Policy makers have also anticipated the challenge of maintaining borrowers’ standing with credit bureaus. When borrowers accept moratoria during a national emergency, it should not hurt their creditworthiness.

In 2020, there was confusion over how banks should report restructured loans to credit bureaus, how credit bureaus were to incorporate these loans into credit scores, and how new lenders were to use the information.

In India, FSPs simply didn’t report many loans for several months. Eventually, those problems were sorted out. Now, in 2025, credit bureaus follow well-understood protocols for handling loans in moratoria during emergencies.

Preparedness

The emergency protocols that the world’s banking authorities and FSPs put in place after the COVID-19 pandemic also address operational continuity and communications.

Back in 2020, economic lockdowns prevented in-person interactions between lenders and borrowers and often led to breakdowns in communication. In Uganda, loan officers could not meet with customers in the field, and transport restrictions prevented adequate staffing of branches and even call centers. FSPs transacting mainly in cash were caught especially flat-footed.

Thankfully, this problem is behind us now. The pandemic accelerated FSPs’ digitization plans across the world, and record numbers of borrowers started using mobile technology. FSPs serving lower-income customers now routinely communicate and transact digitally.

They have also upgraded their internal systems to handle the irregular schedules of loans in moratoria. And the expansion of digital infrastructure during and after COVID-19 now allows staff to work from home.

Consumer protection

As financial regulators and supervisors prepare for the new moratoria in 2025, they are better equipped to mitigate some of the consumer risks that appeared in 2020. They now use market monitoring tools, such as suptech, consumer phone surveys and mystery shopping, to assess consumer risks in real time. They can quickly spot issues such as abusive collections practices.

Nevertheless, both financial authorities and FSPs have learned from the previous crisis that ensuring good communication and transparency will be challenging. Moratoria are unfamiliar concepts, and the math is complicated.

Learning from 2020, when poor communication led to misunderstandings, mistakes and abuse, regulators have already issued consumer protection rules to ensure the public fully understands moratoria offers and their consequences.

Additionally, communications now flow not just to customers, but also from them. Policy makers are widely using tools that give consumers a collective voice and reveal what they are experiencing.

Several regulators have put consultative bodies in place to have a regular dialogue with consumers, and consumer associations regularly convey issues to them. Such tools proved useful in 2020.

In Peru, for example, the consumer protection agency INDECOPI listened systematically to customers and alerted regulators and FSPs to emerging abuses so that they could respond quickly.

Agility

The COVID-19 pandemic lasted much longer than anyone foresaw, and unanticipated implementation challenges arose. If policy makers learned one thing, was is that you can never anticipate all the ways an emergency will unfold.

Accordingly, the countries that were best prepared for the next pandemic were those that had established channels for authorities and FSPs to work together to respond to evolving conditions.

Source: Consultative Group to Assist the Poor (CGAP) is a global partnership of more than 30 leading development organizations that works to advance the lives of poor people through financial inclusion.

*Elisabeth is the former managing director of the Center for Financial Inclusion at Accion. She is a visiting fellow at the Financial Access Initiative and a consultant at CGAP.

*Eric Duflos, Senior Financial Sector Specialist, leads CGAP’s work on consumer protection, from policy, industry and customer perspectives, ensuring that financial services have positive outcomes for customers.

 

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