OSCE Special Representative for Combating Trafficking in Human Beings offers recommendations to governments on short-term responses to COVID-19: “Without urgent and targeted action, this health and economic crisis can become a human trafficking crisis, putting many more lives and the cohesion of our societies at risk.” “Human trafficking feeds off vulnerability. It is precisely when our global community is shaken by a crisis of this magnitude that our obligation to combat the exploitation of vulnerable people becomes most acute.”
By PRESS RELEASE
VIENNA, Apr 30 2020 (IPS-Partners)
How to address the consequences of the COVID-19 pandemic for the most vulnerable in our societies, especially for human trafficking victims and survivors, is the focus of a set of recommendations to governments published by the OSCE Special Representative and Co-ordinator for Combating Trafficking in Human Beings Valiant Richey today.
Building on his earlier statement, Richey alerted governments to the risk that, without urgent and targeted action, this health and economic crisis becomes a human trafficking crisis, putting many more lives and the cohesion of our societies at risk. “The impact of the COVID-19 crisis on trafficking in human beings is deeply concerning. Our recommendations aim to support the 57 OSCE participating States in combating trafficking in human beings during and following the current crisis, as vulnerabilities will compound in the weeks and months to come,” he said.
Human trafficking feeds off vulnerability —in particular, gender and economic inequality — and it is a symptom of frailty in our society. Richey stated: “It is precisely when our global community is shaken by a crisis of this magnitude that our obligation to combat the exploitation of vulnerable people becomes most acute. Combating human trafficking is not just a law enforcement responsibility. It is a human, societal, and security imperative and an urgent priority.”
“With the necessary attention, adequate resources, and the right programmes, we can start today to build a better and safer tomorrow for all.” Said the Special Representative who stands ready to provide further support to participating States, including through tailored technical assistance for the development and implementation of anti-trafficking action plans and other legislative or policy efforts.
Recommendations:
Prevention
1. Ensure universal access to essential economic and social welfare services, including unemployment aid, for all those who need them, regardless of their recent employment history. This will help prevent those affected by the economic impact of the crisis, including millions of unregistered domestic workers, from falling into the hands of traffickers.
2. Grant or extend temporary resident permits to migrants and asylum seekers, regardless of their legal status. This will increase their resilience by facilitating access to healthcare and other welfare services and will also help States’ authorities and social services promptly identify presumed victims of trafficking and better prevent future episodes of exploitation.
3. Prioritize resources for exit services in high-risk sectors such as the prostitution industry. With purchasing of commercial sex artificially suppressed as a result of the lockdown, inclusive programmes ensuring support can be a powerful tool to break the cycle of exploitation and strengthen exit pathways, giving a real alternative to those in need.
Protection
4. Provide victims of trafficking with access to safe and immediate accommodation, health care and psychological assistance, to assist in their exit from trafficking and protect them from revictimization. Temporary quarantine accommodation prior to shelter placement has been identified as a promising practice to ensure compliance with COVID-19 prevention measures.
5. Extend for at least six months all protection and assistance measures for all victims of trafficking, including work permits and access to services, to ensure continuity in their social inclusion process beyond the current health crisis. Continue investments in rehabilitation programmes, as the risk of ‘losing’ those survivors who are already in transition is now particularly high due to the adverse economic situation. Provide online support to victims of trafficking inside and outside shelters. Psychological counselling, legal support as well as educational and training activities are examples of the services which might be temporarily provided remotely to ensure the continuity of victim’s support and to prevent re-trafficking.
6. Establish or strengthen hotlines for human trafficking, domestic violence and child abuse (including online) reporting, and broadly promote their services as a tool for the identification of presumed cases of human trafficking.
Prosecution
7. Ensure high alert among law enforcement and other first line responders to recognize and detect human trafficking. With traffickers likely to pivot to online exploitation, and with police, labour inspectors, social workers, healthcare professionals, educators and NGOs currently dramatically limited in their anti-trafficking efforts, detection and suppression efforts will have to adapt to a changing environment.
8. Ensure the continuity of the justice system to investigate and prosecute traffickers even in times of lockdown. For example, holding court via video or teleconferencing should be considered and actively pursued whenever possible as a tool to ensure timely justice and avoid re-traumatizing victims.
9. Investigators should be prepared as traffickers change their modus operandi, increasing online enforcement presence and employing advanced investigative instruments, including financial investigation tools to detect human trafficking in financial flows due to an increase in non-cash payments.
10. Plan systemic labour inspections of high-risk industries immediately after business operations resume. Agriculture, due to the summer harvest, is a prime example of an area to monitor with particular attention.
11. Once lockdown measures are lifted, keep a high law enforcement alert on forms of trafficking that are likely to increase in the near future, such as online exploitation and forced begging.
Partnership
12. Incentivize or mandate technology companies to identify and eradicate risks of human trafficking on their platforms, including by identifying and stopping distribution of child sexual abuse material online. Establish or strengthen law enforcement and judicial co-operation, including at the pre-trial stage, with countries of origin and destination in cases of online exploitation, especially of children.
Looking ahead
13. Plan ahead to ensure that the anti-trafficking community can respond adequately to another possible Coronavirus outbreak. The forecast for a second COVID-19 wave later this year highlights the need to ensure that assistance facilities, protection programmes, investigations and courts continue functioning during possible future lockdown measures.
Media Contact:
Lilia Rotoloni
Public Information Officer
Lilia.Rotoloni@osce.org
+33 (0)628340397
@osce_cthb
The post OSCE PRESS RELEASE: COVID-19/Human Trafficking appeared first on Inter Press Service.
Excerpt:
OSCE Special Representative for Combating Trafficking in Human Beings offers recommendations to governments on short-term responses to COVID-19:
“Without urgent and targeted action, this health and economic crisis can become a human trafficking crisis, putting many more lives and the cohesion of our societies at risk.”
“Human trafficking feeds off vulnerability. It is precisely when our global community is shaken by a crisis of this magnitude that our obligation to combat the exploitation of vulnerable people becomes most acute.”
The post OSCE PRESS RELEASE: COVID-19/Human Trafficking appeared first on Inter Press Service.
The International Institute of Tropical Agriculture (IITA) Young Agriprenuer Programme is promoting youth participation in agribusiness with hands on skills training in farming and entrepreneurship. Credit: Busani Bafana/IPS
By Busani Bafana
BULAWAYO, Zimbabwe, Apr 30 2020 (IPS)
In Rwanda, Benimana Uwera Gilberthe, a scholar and pepper producer, experienced first-hand the challenges of breaking into agribusiness.
While in Nigeria, Ayoola Adewale is trying to understand if poultry egg farming will prove a profitable and viable business opportunity to the youth of the continent’s most populous nation. Also in Nigeria, Esther Alleluyanatha is understanding the link between young people leaving their villages for larger cities, the remittances they send home, and the implications on rural livelihoods and agriculture productivity.
In understanding this, these three young researchers are in fact providing answers to greater questions about agriculture on the continent. Like:
Adewale, Alleluyanatha and Gilberthe are just three of the 80 young African scholars that are tackling the business of agriculture through the innovativeness and freshness that comes with youth — while obtaining their masters or doctoral degrees in the process.
They are awardees of the Enhancing Capacity to Apply Research Evidence (CARE), a three-year project that was launched in 2018 by the International Institute of Tropical Agriculture (IITA), with funding from the International Fund for Agricultural Development (IFAD).
The project aims “to build an understanding of poverty reduction, employment impact, and factors influencing youth engagement in agribusiness, and rural farm and non-farm economies,” according to IITA Director General Nteranya Sanginga.
“Grantees were offered training on research methodology, data management, scientific writing, and the production of research evidence for policymaking. They are mentored by IITA scientists and experts on a research topic of their choice and produce science articles and policy briefs about their work,” Sanginga explained.
He has long championed the idea that developing agriculture is key to addressing the urgent challenges of food insecurity, poverty and youth unemployment on the continent.
“Youth brings energy and innovation to the mix, but these qualities can be best channelled by young Africans themselves carrying out results-based research in agribusiness and rural development involving young people. Youth engagement is key,” Sanginga said.
Young farmers and brothers Prosper and Prince Chikwara are using precision farming techniques at their horticulture farm, outside Bulawayo, Zimbabwe. Credit: Busani Bafana/ IPS
Commercial agriculture the answer to youth unemployment?Adewale, a PhD candidate at the University of Ibadan, works as a technical assistant at the Federal Operation Coordinating Unit for Youth Employment and Social Operation (FOCU-YESSO) in Abuja.
YESSO is tasked with providing access to work opportunities for Nigeria’s poor and vulnerable youth.
“Commercialised agriculture holds immense potential as a way out of poverty,” Adewale told IPS.
“Youth involvement in commercialised agriculture is growing and seems to be the way out of the current unemployment rate. However, government and private sector support is required if youths will compete favourably, thrive sustainably and raise coming generation of commercial agriculture entrepreneurs,” Adewale said.
For her research topic she wants to understand if poultry egg production is a profitable and technically efficient venture for youth farmers, specifically assessing the impact of the Commercial Agriculture Development project (CADP).
“Commercial agriculture, across all value chains, holds potential to boost productivity, profitability and economic growth of Nigeria and indeed Africa,” she said. “The study will provide insight into how commercial agriculture programmes are sustainable as well as provide direction into how commercial agriculture can be harnessed for African agriculture.”
Money in agricultureAlleluyanatha, also from Nigeria, is also concerned about the high rate of unemployment among youth — particularly in urban areas.
“There is a need, therefore, to discourage the exodus of youths from rural to urban areas and to encourage them to go into agriculture, which is known to be the major source of livelihood in the rural areas,” Alleluyanatha said.
She is researching youth migration and remittances and the implications on rural livelihood and agriculture productivity in Africa. She aims to do this by comparing households with youth migrants and those without.
In Rwanda, Gilberthe and his under-graduate classmates started growing pepper for export after securing a contract with the country’s National Agricultural Export Development Board.
“The venture was successful and we gave youth in my areas the idea on how agribusiness can be a decent job if you do it professionally and invest in it,” Gilberthe told IPS. “I used to have at least $210 each time we sold our product.”
Youth aged between 14 and 35 years make up 39 percent of Rwanda’s population but, according to Gilberthe, many are not participating in agribusiness owing to limited agribusiness skills, lack of start-up capital, limited access to land, and information on agribusiness opportunities.
Gilberthe is researching how being part of financing schemes impact the incomes of youth agripreneurs.
He believes policies for youth engagement in agribusiness should also include trainings about running such businesses. In addition, he believes such policies should also make provisions for more agribusiness financing schemes.
“In Rwanda, youth engaged in agribusiness have a problem of not owning land and most of them use their parent’s land but their income is limited and they need access to credit,” he said.
“I think differently about agriculture now,” says Gilberthe. “As a young researcher I have discovered the opportunities and barriers for youth engaged in agribusiness and this research is giving me a chance to contribute toward policy formulation about youth engagement in agribusiness.
“Through my findings I will be able to prove wrong youth who take agriculture as the work for old and village people and other people who still think that agriculture cannot improve your income.”
Related Articles
The post Africa’s Youth Scholars Harvest Ideas on the Business of Agriculture appeared first on Inter Press Service.
Excerpt:
80 young African scholars are tackling the business of agriculture through the innovativeness and freshness that comes with youth — while obtaining their masters or doctoral degrees in the process.
The post Africa’s Youth Scholars Harvest Ideas on the Business of Agriculture appeared first on Inter Press Service.
Primary School in Dhaka, Bangladesh. Credit: Shafiqul Alam Kiron/IPS.
By Manssour Bin Mussallam
GENEVA, Apr 30 2020 (IPS)
An invisible adversary has thrown the world – Global South and Global North alike – into disarray. The psychosocial and economic consequences of the COVID-19 crisis will remain with us long after it has been overcome. There will be no anti-viral return to the pre-coronavirus status quo, nor can we afford to idly wait for a viral transformation of our world. The future is not inevitable, abstract promise – it will depend on our collective readiness to forge it, or to be forged by it.
Manssour Bin Mussallam
Although it has been claimed that no one could have foreseen that in 2020, over 1.5 billion students would be forced to stay at home because of a virus, experts worldwide have repeatedly signified that just such a crisis was indeed conceivable.
For the prevailing short-sighted, boom-and-bust economic system, excessively geared towards short-term profits, has left no margin for societies to address social emergencies.
Even now, the same analysts and international actors who, in the name of economic efficiency, have undermined our common public goods for years, are promising us new global solutions. Our global challenges, however, do not require global solutions.
They require a shared vision, underpinned by contextual policies and supported by efficient, solidarity-based mechanisms of international cooperation and coordination.
The COVID-19 pandemic has exposed, and exacerbated, the social and economic divides between, and within, societies. But it did not cause them.
To argue that the laissez-faire policy prescriptions enforced by our international institutions have fuelled this crisis would, in fact, make for a better case. And as we now wage an absolute war to contain the virus and mitigate its consequences, we must be willing to learn the lessons being taught to us by this crisis, if we are to reconstruct – and not merely reproduce – our international and national systems.
From underfunded and understaffed healthcare systems to the estimated 154 million people who find themselves homeless and unable to self-isolate, passing by the professionals living pay-check to pay-check for whom self-isolation protects life but endangers livelihood, and the 1.5 billion out-of-school students worldwide with unequal access to e-learning portals, the injustices which devastate our societies are more than a mere moral concern: they are threats to our common future.
The development models emanating from the Global North having failed, it is now long overdue for the assumptions permeating our international institutions to be challenged, and for a third, alternative, inclusive way of development to be constructed from the Global South
Several initiatives have already been announced to mitigate the effects of this crisis: recalling retired health professionals, providing safe-spaces for self-isolation, suspending foreclosures and evictions, and commitments by technology giants to provide software and equipment free-of-charge.
These measures, amongst others, are necessary. But they are also insufficient. If we are to overcome, once and for all, crises such as the current pandemic, we must be unwavering in our determination to address the injustices it has exposed.
We must, therefore, protect the right to free, quality universal healthcare; enshrine dignified, affordable housing as an unalienable right; ensure material and immaterial security for the peoples of the world; protect the right to paid sick and holiday leave as well as a living wage for all workers; and bridge the techno-digital divide.
This requires an unprecedented mobilisation of intellectual, human, technical and financial resources. It also calls for our initiatives to emancipate themselves from stale concepts so as to construct authentic, effective alternatives.
Free, quality universal healthcare and dignified, affordable housing will not be achieved as long as we continue dismantling them as private commodities from which to profiteer, rather than investing in them as common public goods which ought to be protected.
Material and immaterial security, living wages, and socially conscious labour laws will not be realised without an international system which consecrates human dignity and contributes to the implementation of holistic, humanistic, and progressive social policies.
The techno-digital divide will not be bridged by relying on expensive, imported technologies – often ill-suited to national and local contexts – nor by generating nationwide technical dependency on private multinational companies, when such technologies are donated.
We must develop local, endogenous technologies – more affordable, sustainable, and contextually relevant – which harness the creative potential of communities and stimulate national economies.
In a world in which the collective wealth of 6.9 billion people constitutes less than half of the wealth amassed by the richest 1%, and the market capitalisation of a single company such as Apple Inc. surpasses the GDP value of entire economies – including those of countries in the Global North, such as the Netherlands, Switzerland, Belgium, and Sweden – , the feasibility of such measures does not seem any more outlandish than the sustainability of this present state of affairs seems preposterous.
This does require, however, international platforms of solidarity-based cooperation acting as instruments and catalysts for a sustainable, prosperous and equitable development, that is inclusive of the perspectives, priorities, and needs of the majority of the world’s population.
If ad-hoc multilateralism and lack of global solidarity continue to administer the international system, which seems more preoccupied by its own survival than by achieving our collective aspirations, the current COVID-19 pandemic will only be a preview of future crises to come.
And it is highly unlikely for those who have institutionally enabled such an international system to also be those who will reshape it – good intentions notwithstanding. The development models emanating from the Global North having failed, it is now long overdue for the assumptions permeating our international institutions to be challenged, and for a third, alternative, inclusive way of development to be constructed from the Global South.
It is with this motivation that African, Arab, Asian, Latin American and Pacific Island countries, as well as international civil society organisations, founded the Organisation of Educational Cooperation (OEC) to “contribute to the equitable, just, and prosperous social transformation of societies by promoting balanced and inclusive education, in order to attain the fundamental rights to liberty, justice, dignity, sustainability, social cohesion, and material and immaterial security for the peoples of the world”.
The OEC is not, accordingly, an international organisation for education, but rather an international organisation for development through education, since true development cannot be compartmentalised, and the transformative power of education is only true insofar as it is itself transformed.
This new, proactive, multilateral framework of cooperation which we are constructing places the concerns and aspirations of countries and peoples at the centre of global policymaking and at the forefront of development efforts, respecting and adapting to national priorities, local aspirations, and socio-cultural contexts.
The COVID-19 pandemic is both a tragedy and a test in crisis management for the entire world. It is also a reminder of the importance of renewing and reinventing the spirit of true solidarity and multilateralism in the 21st century. The time has come for new, innovative international mechanisms and platforms, not only designed to keep the peace, but also achieve the justice of which peace is the fruit.
Armed with a sense of duty, an impulse of solidarity and an intransigent determination, it is now our historic responsibility to heed the warning of this crisis and give ourselves the means to collectively forge the future to which we aspire, and which we deserve.
——
Sheikh Manssour Bin Mussallam is the Secretary General-elect of the Organisation of Educational Cooperation (OEC), an international governmental organisation established on 29 January 2020 at the International Summit on Balanced and Inclusive Education by African, Arab, Asian, Latin American and Pacific Island countries and civil society organisations from across the Global South. He has previously served as the President of the Education Relief Foundation.
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Excerpt:
Manssour Bin Mussallam, is Secretary General-elect of the Organisation of Educational Cooperation (OEC)
The post The COVID-19 Pandemic and the Reinvention of the Spirit of Solidarity and Cooperation appeared first on Inter Press Service.
By Jan Lundius
STOCKHOLM / ROME, Apr 30 2020 (IPS)
For some time Wuhan in China and Lombardy in Italy were epicentres of the COVID-19 virus, something that has changed when the contagion is spreading fast in the US. A Lombardy in the grip of a deadly epidemic might among several Italians give rise to memories of their school days. For almost a century, Alessando Manzoni’s massive novel The Betrothed (I promessi sposi) from 1842 has been obligatory reading for all Italians during their last primary school year. A quite impressive endeavour considering that the novel is more than 700 pages long.
I assume almost every adult Italian is familiar with the Divine Comedy, Pinocchio and, of course The Betrothed. No Italian novel has been the object of so much veneration, scrutiny and intense scholarship. I have been told by Italian friends that they are surprised that The Betrothed is not more known and appreciated outside of Italy and to my discredit I have often been forced to admit that I had not read it.
While being quarantined in Rome I picked up The Betrothed, thinking ”it´s now or never”. It proved to be an interesting acquaintance. Taking as its point of departure a small Lombardian community during the 17th century the novel described how poor, defenceless people experienced war, pestilence, foreign occupation, poverty, famine, power abuse, religious fanaticism, mafia rule, legal injustice and manipulative, corrupt authorities. These are common themes in other literary works as well, though what made The Betrothed a pleasure to read was Manzoni’s use of language. For being such an old novel it felt amazingly fresh. Alessandro Manzoni made use of a literary device by retelling a story while stating it had been written by another author. This enabled him to keep an ironic distance to his tale and being free to interpose witty comments about events and protagonists. Manzoni also occasionally reminded his readers that his story evolved within a well-documented, historical reality.
With mounting expectations I reached the last and third part of the novel – its famous description of the plague in Milan. Here Manzoni offers a description of a wide variety of reactions to a calamity that befalls an entire society: ”In any public misfortune, in any long disturbance of whatever may be the normal order of things, we always find a growth, a heightening of human virtue; but unfortunatly it is always accompanied by an increase in human wickedness.” 1
In 1628, the Holy Roman Empire included Lombardy, which became the scene of bloodshed and looting while French troops battled mostly German mercenaries, remunerated by the Spanish branch of the Habsburgs. Soldiers carried with them the bubonic plague. In Milan, the centre of Lombardian industry and commerce, authorities were implementing effective public health measures. However, relaxed regulations during the carnival season in 1630 caused a major outbreak of the plague and by the same time the following year, an even deadlier wave of the plague engulfed the city. Overall, Milan suffered approximately 60,000 fatalities out of a total population of 130,000.
Milan counted upon a Commission of Public Health with far-reaching authority. It consisted of one president, four magistrates and two doctors of medicine. Its decrees were effectively enforced by the police. Milan also counted upon a lazaretto, a quaratine hospital with 288 rooms, founded in 1489, where suspected plague victims were brought for observation and treatment.
Rumours about plague victims in surrounding villages reached Milan in October 1628. The Commission immediately dispatched medical doctors to the village of Lecco. However, they came back reporting that the outbreak of disease had probably been caused by vapours from surrounding swamps. Nevertheless, during the following weeks more plague reports came in from villages even closer to Milan. Two commissioners were sent out and came back with alarming reports that plague deaths now occurred all over the countryside and people were panicking. Milan’s city gates were closed and outsiders allowed in only under extraordinary circumstances, all incoming goods were stored and checked for vermin. In mid-November a patient No. 1 was traced, a certain Pier Paolo Locati had returned home dressed in German military clothing, probably taken from a corpse. Just a few days after his arrival, Locati had fallen down dead in a market square. All persons he had been in close contact with were tracked down and quaratined in the lazaretto, while their former living quarters were sealed off. The health commissioners visited the Spanish governor asking for taxes to be waived and economic assistance offered to shop keepers and others who were making a loss due to the enforced quarantine. The lazaretto also had to be enforced with doctors, surgeons, medicins, food and eqiupment. The governor declared he was desolated by the news, but since a war was waged against the French he could neither lower taxes, nor release any funds and he recommended opening the city for business again, regardless of the risks.
Probably due to efforts by the Commission of Public Health, Milan had so far not been much affected by the plague and people demanded that the quarantine had to be lifted. The City’s Chief Physician, eighty years old Lodovico Settala who had lived through another plague and constantly pleaded for even harsher measures, was almost lynched by an angry mob. When carnival celebrations were planned for 1630 a majority of Milan’s citizens pleaded with the City Council that restrictions had to be lifted. The town authorities gave in. Outsiders were allowed to enter, shops and restaurants were kept open. The commissioners of public health protested and even had a carriage with naked, plagued stricken corpses taken from the lazaretto and driven through the city as a warning of what could happen if people did not stay indoors.
Nevertheless, the Milanese went along with their carnival. A few days later the plague was completely out of control. Soon tens of thousands of plague victims were amassed within the lazaretto. However, most people continued to neglect the Commission’s decrees about social distancing. Instead, rumours were spread that the plague was not a common plague at all, but caused by a French manufactured substance intended to kill Lombardians, vanquish the Spaniards and take control over Europe. The substance was said to have been smeared on walls and doors by French agents, or spread among crowds in the form of a powder. People began to see so called anointers everywhere. Innocent people were lynched being accused of being anointers, even the authorities convicted and executed inculpable persons as anointers, just to prove they were taking measures to halt the plague.”Good sense was not lacking, but it was hiding from the violence of public opinion.” 2
Authorities and medical doctors, who assumed their prestige were dependent on people’s appreciation, adapted their ”expertise” to general perceptions. ”From the inventions of the crowd, educated men borrowed all they could reconcile with their own ideas; from the inventions of the educated, the crowd borrowed as much as they could understand […]. Out of all this emerged a confused and terrifying accumulation of public folly.” 3 The more fanciful these opinions were, the more unreservedly they were accepted: ”poisionous arts, diabolical operations, conspiracies of people spreading the plague by contagious venoms or black magic.” 4 Manzoni provided several examples of how ”educated” people to cover up their deficient knowledge of how a pandemic functioned and above all to avoid recommending the unpopular solution of social distancing, invented notions that the plague could not be stopped since it arose from ”cosmological phenomena”, or that it was caused by malevolent ”foreigners” who wanted to gain control over Milan. To combat the plague they recommended worthless medicines and remedies, anything but the unwanted quarantine.
It was Italian city states, depending on international trade, like Venice, Milan and Genoa, which were among the first to realize that the most efficient way to stop epidemics were to quarantine people. The word quarantena means ”forty days”, i.e. the designated period that crew and passengers suspected of being plague carriers onboard ships anchoring in Venice were required to be isolated for, before they were allowed ashore. The Venetian Senate had just in time before the arrival of the Black Death, in 1340 appointed three guardians of public health to control incoming ships and establish whether they carried the plague, or not. In 1403, Venice founded a lazaretto, an asylum for suspected plague victims on a lagoon island housing a monastery called Santa Maria di Nazareth (Nazaretto), which later came to be known as Lazaretto.
Officially supported installations and regulations eventually became a system of state controlled Public Health, of which Milan’s Commission of Public Health was one example. Trough such state entities the science of epidemiology gradually emerged. Viruses and bacteria were still unknown. However, Italian plague doctors like Girolamo Fracastoro (1483-1553) were 300 years before Louis Pasteur and Robert Koch speculating that contagious diseases could be caused by rapidly multiplying ”seed” transmitted by direct contact, through the air, or on contaminated clothing and linens. Such insights meant that lazzarettos and communes as a remedy against infectious diseases fostered health control and general cleanliness. It was agreed that such measures were effective only if implemented by a public heath system, free of charge.
The Betrothed described how common sense propagated by state supported commissions were impaired by populist community leaders. If something could be learned from a fascinating old novel like The Betrothed it is that even four hundred years ago trust in medical experience could have impeded a deadly pandemic. However, in 17th century Milan, leaders responsible for the well-being and security of their fellow citizens had apparently not learned from earlier mistakes. They ignored the dire warnings of the city’s Commission of Public Health and minimized the treats of an epidemic killer with disastrous consequences. Let us only hope that the current cataclysm is not globally repeated to the same horrific extent as in Milan 1630-1631.
1 Manzoni, Allesandro (1972) The Betrothed. Penguin Classics: Bungay, Suffolk, p.596.
2 Ibid., p. 603.
3 Ibid., pp. 600-601.
4 Ibid., p. 578.
Jan Lundius holds a PhD. on History of Religion from Lund University and has served as a development expert, researcher and advisor at SIDA, UNESCO, FAO and other international organisations.
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Jay Collins speaks at the informal virtual meeting of the 2020 ECOSOC Forum on Financing for Development follow-up: "Financing Sustainable Development in the Context of COVID-19". Credit: United Nations
By Jay Collins
NEW YORK, Apr 30 2020 (IPS)
We are today in a time of crisis—a time when our shared choices will shape the way history tells our story and the paradigm shift it has so forcefully provoked.
The difference between the historical path of promise or peril will be defined, not just by the urgency and manner of our response, but also by our shared vision of recovery and renewal.
The ongoing COVID-19 pandemic has struck the planet with scant concern for human suffering, and with vast economic destruction and financial cost. But more than that, it has dealt a blow to our Sustainable Development Goals (SDGs) , and we must urgently address how we will recover from it.
The global community can be proud, thus far, of the size and speed of the multi-trillion-dollar mobilization of capital in response to COVID-19. We have demonstrated that we are capable of radical and forceful societal response in the developed world.
However, we have only just begun to fight COVID-19’s wrath in the developing world. As the pandemic shows little respect for national boundaries, we must embrace the opportunity to re-enforce, re-purpose and re-invigorate the multilateral cooperation mechanisms and organizations of the Bretton Woods era if we are to meet the developing world’s challenges.
As the COVID-19 crisis continues, we should urge that massive stimulus efforts be affected sustainably: targeted and aligned to the SDGs and compatible with the Paris Agreement trajectory.
Climate change and global pandemics both epitomize Michele Wucker’s “Gray Rhino” concept—that is, neglect of the highly probable, high impact, global threats. Yes, many had in fact told us that a pandemic was coming, and we did not responsibly prepare.
As Mark Carney has so aptly pointed out, climate change also imbeds within it “the tragedy of commons,” in which the cost of inaction today is felt by future generations, well beyond humanity’s traditional economic and political time horizons.
Let us not permit that our grandchildren look back on climate change as humanity’s worst “Gray Rhino moment,” but use this COVID-19 crisis to re-galvanize our resolve against it.
We must embrace an intense dialogue with policy makers, regulators and the private sector, not only about funding and incentivizing the glide path of energy transition, but also about how to manage the new headwinds that low oil prices, pandemic-strained budgets and drained capital coffers represent.
We must meet the potential COVID-19 setback to the SDG agenda with defiance and with Churchillian resolve, unafraid to pivot as the virus moves our targets tragically further out of reach and makes our Goals even more ambitious in their aims.
Let us be resolved not to let a temporary corporate and investor focus on liquidity and volatility alter the pre-crisis momentum toward bold public private partnerships, stakeholder- driven corporate leadership and ESG investor commitment to achieving the SDGs.
Let us also not underestimate the plight of the poorest countries through this crisis. If the human price is not enough to inspire action, contemplate the global political consequences of an inability to respond to social crises in the developing world and of social unrest.
These challenges can develop quickly and can be as systemically destabilizing as methane bubbling through the permafrost.
Today, it is fair to say that the “S” in “ESG” now has a double line underscoring it as investors and securities issuers alike fund COVID-19 health and social spending. The social SDGs have moved to the forefront of our battle.
There are already silver linings in the COVID-19 ESG momentum. Let me name a few:
Despite these rays of hope, COVID-19 has made our funding challenges greater, and the call to use capital markets and creative funding mechanisms more urgent. The debt quagmire in the poorest of the emerging market economies has been and will continue to worsen through this crisis.
The Secretary-General and, in parallel, his Global Investors for Sustainable Development (GISD) Alliance, have recognized the challenges of debt to our agenda; we cannot help but acknowledge the fallacy that increasing indebtedness to fund the SDGs represents for many of the world’s poorest countries.
While instinctively we already know that the pandemic has shifted our goal posts, we must invest heavily and speedily in the technology and processes for SDG and ESG metrics alike, embracing Big Data solution-sets.
Rearview mirror, macroeconomic data is insufficient for the challenges ahead and lacks the precision to measure future success.
As we face head-on the consequences of the potential exponentiality of the COVID-19 infection curves in the developing world, so too must we embrace the exponential characteristics of beneficial technological solutions applied aggressively to Sustainability challenges.
While guarding against its pitfalls, applied technology and innovation, if funded at scale, can lower the cost and speed of attainment of our Goals.
The 193 UN member states are taking decisive action to arrest the fallout from COVID- 19, and we must not forget the importance to the developing world of maintaining open and functioning capital markets.
These allow the broadest possible access to funds for our response. Simultaneously, the development bank community must continue its urgent search for out-of-the-box, accelerated and modified risk-sharing mechanisms, leveraging and catalyzing private sector credit where possible, surgically mitigating risk where necessary, and fully absorbing risk where systemically vital.
Lest we forget, in radical juxtaposition to the Global Financial Crisis, the global banking system today is strong and will continue to constructively support solutions to the pandemic and its social and economic consequences.
As we search for temporary reprieve mechanisms to address the weakest credit sovereigns, let us avoid contagious defaults that can shock the financial system, further restrict existing credit extension mechanisms, or slow the capital formation process of recovery.
This will be no easy feat. In some cases, it will require us to engage the market in voluntary standstill mechanisms that are closely coordinated with the official sector and move us toward orderly debt re-profiling strategies once the present fog lifts and the path to debt sustainability can be seen more clearly.
As Shakespeare wrote, “Sweet are the uses of adversity.” This cannot be “the end of normal,” but must be an historical starting point for the creation of a better normal.
We have the potential to re-imagine capitalism in a post-COVID world, to embrace long- termism and multi-stakeholder corporate behavior and to use COVID-19 adversity to reinvigorate our commitment to addressing the greatest social, environmental and economic challenges of our time.
*Citigroup is one of the 30 investor, corporate and bank members of the GISD Alliance. Jay Collins is a member of GISD’s Strategy Group, and delivered a version of these remarks at the UN ECOSOC Forum on Financing for Development on 23 April 2020.
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Excerpt:
Jay Collins is Vice Chairman Banking, Capital Markets and Advisory, Citigroup*
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Students learn with tablets in a school in South Africa. Credit: AMO/Jackie Clausen
By External Source
CAPE TOWN, South Africa, Apr 30 2020 (IPS)
South Africa’s education system is complex, with historical inequalities dating back to apartheid. Most of the country’s pupils come from disadvantaged backgrounds. Language is an issue; most pupils do not speak English as a mother tongue, yet English dominates in many classrooms. And, as the COVID-19 crisis has showed, there’s a huge digital divide at play.
The ongoing effects of the virus have kept pupils and teachers at home. This has necessitated a move to e-learning. In theory, this could be an important step towards a fairer education system. Digital platforms enable equitable access for learners to digital books, simulated science labs and related innovative learning resources.
Electronic and mobile learning can thus be seen as an additional learning resource that can also help enhance access to learning tools. Access to e-learning is not a panacea to the challenges in South African education. But it does provide an opportunity to make access to learning resources for all children more equitable.
COVID-19 has shown that technology is no longer a luxury but an important component of the education process. In presenting solutions, a wide range of factors must be considered. These range from access to computers, to teacher training, to the social and economic challenges faced by teachers, pupils and schools in their communities
But the reality in South Africa, as in most developing countries, is very different. Teachers have varying digital skills. Many families and teachers also cannot afford the data necessary to sustain some online learning activities.
COVID-19 has shown that technology is no longer a luxury but an important component of the education process. In presenting solutions, a wide range of factors must be considered. These range from access to computers, to teacher training, to the social and economic challenges faced by teachers, pupils and schools in their communities.
National focus
There are already some strategic policies and resources in place to help schools and teachers use technology as part of the teaching and learning process.
Information and Communications Technology is also taught as a school subject. But the government needs to consider an additional range of issues if it’s going to solidify a commitment towards e-learning. This includes policies and strategies surrounding connectivity, data costs, skills development, hardware access as well as contextual multilingual digital learning content.
Many schools have little or no technology facilities. Some have tablets and only a few have advanced computing laboratories. Formal training in applied technology skills is provided for teachers who want to teach a technology specialist subject in schools.
But all this needs to be extended. Adequate digital skills training should become a mandatory component of all teacher training programmes in universities, universities of technology and colleges. While there have been several digital training programmes for both in-service and trainee teachers in some provinces, it is time for a concerted national programme to ensure all teachers are skilled in digital teaching and technology.
Several studies have reflected on the innovative use of mobile phones and related applications to support learning in South Africa.
But South Africa has some of the highest data costs on the continent. This means that pupils can’t always easily access information on their mobile phones.
In the wake of South Africa’s first COVID-19 cases, as schools closed, several educational sites were zero rated; this means they are now free to use.
This should be extended to support home schooling and any future returns to school, so that data costs don’t keep schools in poorer communities from accessing these resources. Policies to enable such beyond the pandemic should be considered.
Projects that work
As an educator who focuses on Education Technology research, I know there is enormous enthusiasm among teachers and pupils to become more digitally savvy. I have worked with a number of under-resourced schools, supporting the teaching of Science, Technology and Maths subjects through basic software applications, learning management systems and other free-to-use cloud-based education platforms.
When pupils and teachers receive the right support for digital learning, the response is often remarkable. I have met many teachers who willingly dedicate their weekends and school holidays to digital learning and teaching, with no financial incentives but a passion to equip pupils with digital skills.
I am particularly proud of a collaboration between computing students from the University of the Western Cape with teachers in a high school in an underprivileged part of Cape Town. Their work together has cultivated computing skills and sparked learners’ interest in other subjects like chemistry and astronomy.
A similar collaboration has been expanded to the North West province and convinces me that there are thousands of teachers who are keen to retrain to prepare their pupils for the digital era.
The COVID-19 crisis offers a unique opportunity to harness this enthusiasm. With the right support and training, digital teaching and learning can become ubiquitous even in resource-strapped environments.
Mmaki Jantjies, Associate professor in Information Systems, University of the Western Cape
This article is republished from The Conversation under a Creative Commons license. Read the original article.
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By Farhana Haque Rahman
ROME, Apr 30 2020 (IPS)
Wearing an orange jacket and face mask, Li Zehua, a Chinese freelance journalist, can be seen filming himself in a car. He is sure that state security agents have been pursuing him since he began documenting events in Hubei’s capital Wuhan, the first epicentre of the COVID-19 pandemic. A second YouTube video, circulating widely since he launched his appeal, ends abruptly when two men knock at his apartment. He has just reappeared online after two months, saying police interrogated him and put him in quarantine and that he was well looked after during this period.
Other ‘citizen journalists’ like Li have also seemingly vanished after reporting and sharing images of the Coronavirus outbreak in China – inside hospital wards, in the crematorium, on the street. “The censorship is very strict and people’s accounts are being closed down if they share my content,” lawyer-journalist Chen Qiushi told the BBC in February. He is still missing.
Human Rights Watch says Chinese authorities are putting the same effort into trying to contain the virus as in suppressing criticism. In March, the Chinese government expelled 13 journalists working for three US publications.
Farhana Haque Rahman
World Press Freedom Day on May 3 reminds us that the media is facing crises on multiple fronts, exacerbated by the pandemic. Releasing the 2020 World Press Freedom Index on April 21, Reporters Without Borders (RSF) notes that the Coronavirus is being used by authoritarian governments to implement ‘shock doctrine’ measures that would be impossible in normal times.The index, RSF says, shows a “clear correlation between suppression of media freedom in response to the coronavirus pandemic, and a country’s ranking in the Index” of 180 countries and territories. China (177) and Iran (down 3 at 173) censored their coronavirus outbreaks extensively. Iraq (down 6 at 162) punished Reuters for an article that questioned official coronavirus figures, and Hungary (down 2 at 89) has passed a coercive ‘coronavirus’ law.
The danger and long-term risks of suppressing press freedoms have been strikingly exposed by the pandemic. As the global death toll mounts amidst an economic crisis of unprecedented proportions, China stands accused of acting too late in warning the world about the timing and extent of the threat.
Chinese Foreign Ministry spokesperson Hua Chungying followed up by questioning about the speed of the U.S.’s response to the virus after banning arrivals from China on February 2. Promoting transparent and free reporting in an interconnected world is a global necessity.
This is indeed not the problem of just one country. The World Press Freedom Index illustrates the oppression of journalists from the North to the South in what appears like a pandemic in its own right, regardless of the causes and of the political system.
Even the president of the world’s most powerful democracy, Donald Trump, has described the press as “the enemy of the American people.”
Yet it’s where institutions are more fragile or conflict is rife that the dislike of governments to be held accountable takes shape in typically authoritarian ways.
In Myanmar, eNay Myo Lin was arrested on March 31 charged with terrorism for interviewing a representative of the Arakan Army, a rebel group fighting for autonomy in Rakhine state. Bangladesh, on the other side of the border is seeing increasing violence against journalists.
Democracy is not enough to guarantee media freedom either. In India under Prime Minister Narendra Modi the press “is not so free, writes the New York Times. According to non-profit Pen America, “harassing critical writers and journalists not just in India but globally is a disturbing new low for Modi’s government that’s already put Indian democracy on its heels”.
But it’s not just governments making threats. Organised crime, corrupted officials and terrorism are also constant dangers. April 18 marked the anniversary of the killing of journalist Lyra McKee by a republican paramilitary activist during rioting in Northern Ireland.
So how do we challenge this kind of oppression and abuse in a world where, as Thomas Jefferson said, “the only security of all is in a free press”?
Ultimately, just as in a pandemic, the freedom of the press can only be guaranteed by a coordinated global effort and a focus on the long-term advantages of a more critical world. This means pressure to reinforce legal frameworks, including prosecuting harassers and killers, perhaps just as the international community would persecute war criminals, while offering a global protection for journalists. Finding and promoting innovative ways of subsidizing independent media, as well as getting big tech companies to pay for the content they share, is also crucial to help a free press to thrive.
Albert Camus, writer and author of The Plague, was also a journalist. As he once noted: “A free press can, of course, be good or bad, but, most certainly without freedom, the press will never be anything but bad.”
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Excerpt:
Farhana Haque Rahman is Senior Vice President of IPS Inter Press Service; a journalist and communications expert, she is a former senior official of the United Nations Food and Agriculture Organization and the International Fund for Agricultural Development.
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By Mohammad Rakibul Hasan
DHAKA, Bangladesh, Apr 29 2020 (IPS)
The world is at risk of widespread famines caused by the coronavirus pandemic. The devastating economic impact of Covid-19 is seeing a huge rise globally in the number of hungry people.
Hamida Begum, a domestic worker in Bangladesh who is now out of work said, “We only have forty Taka at home (translates to approximately US 50 cents). We have to drink poison to end life if we cannot go out for work. Who will save us from hunger?” The sufferings of some 7 million slum dwellers around Dhaka, the capital city, are multiplying due to lost earnings and price hike of consumer goods.
Most slum dwellers living in different parts of the capital city no longer worry about the virus but worry more about hunger as they cannot go out to work. They do not have any food reserves. Whatever little they have cannot save them from starvation and hunger in coming days.
Hamida Begum, 37, works as a house maid. She and her husband, a daily labourer are now jobless. The little food they have won’t feed their five member family. Credit: Mohammad Rakibul Hasan
Kulsum Begum, 30, is struggling to feed her three children since her husband died last year. After the lock down she lost her job as a housemaid . She Does notbhave any relatives in the city that she can turn to for to survive. Credit: Mohammad Rakibul Hasan
Shipli Rani Shiuli, 35, is the sole breadwinner of the family. Her husband left her and she takes care of her two sons alone. After the lockdown she lost her job and does not know she will bring food to the table. Credit: Mohammad Rakibul Hasan
Textile worker Helena Begum was laid off last month. She, along her five year old daughter Shakiba and elderly mother, are living on half the amount of food they normally had before the lockdown. Helena who is 35 says that her husband left the family after she gave birth to a daughter. She does not know anyone who could help her to seek a loan. Credit: Mohammad Rakibul Hasan
Aklima, 35, is standing with her one and half year-old daughter Suborna in their one room slum house. She has sent off her three children to the village as they are unable to manage food for themselves in Dhaka city. Aklima says that she and her her rickshaw puller husband can only manage one meal a day and drink water to kill hunger pangs. Credit: Mohammad Rakibul Hasan
Kohinoor Begum and her security guard husband Abul Kashem are now staying at home due to the lockdown Kohinoor lost her job as a housemaid. The only house they had in their village has been swallowed up by the river. During their three years stay in Dhaka city, they never faced such poverty and hardship before the lockdown. With no food at home and no cash, their five family members fear starvation in coming days. Credit: Mohammad Rakibul Hasan
Khadiza Begum, 38, with her two year daughter Sumaiya. She and her husband sold pickles on Dhaka streets. After the lockdown, they paid 4000 Taka (approximately $ 50 ) as rent and now have no money to buy food. Credit: Mohammad Rakibul Hasan
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Employees work on the solar panels of the El Romero plant, with a capacity of 196 megawatts, in the desert region of Atacama in northern Chile, a country that has set out to develop its solar power potential. CREDIT: Acciona
By Humberto Márquez
CARACAS, Apr 29 2020 (IPS)
The oil slump, global recession and uncertainty about the magnitude of the COVID-19 pandemic will fuel the appetite for cheaper fossil fuel energy and delay investments in renewables, affecting the targets of the Paris Agreement on climate change and the Sustainable Development Goals (SDGs).
The countries of the developing South, and in particular oil exporters, will be affected as suppliers to shrinking economies and as seekers of investment in clean energy, in a world that will compete fiercely for low-cost recovery, warned experts consulted by IPS.
The crises, “in view of the abundance and low prices of oil, far from accelerating a change of era that would leave behind fossil fuels and embrace renewable energies, will postpone for a long time that aim, outlined in the SDGs,” said Venezuelan oil expert Elie Habalián.
One of the targets of SDG 7, which calls for affordable clean energy, is to “increase substantially the share of renewable energy in the global energy mix” by 2030.
This is in line with the Paris Agreement on climate change, signed in 2015, which enters into force at the end of this year. The accord includes energy transition measures: national contributions to replace fossil fuels with clean energy, reduce greenhouse gas emissions and curb the increase in temperature to 1.5 degrees Celsius.
These commitments are undermined by the impact of the COVID-19 pandemic, which will cause a severe recession, with the global economy projected to shrink three percent this year and six percent in large countries in the North like the United States and in the South like Brazil.
With that forecast, “it seems that the efforts of governments will tend to sustain and deepen the extractivist model, including hydrocarbons,” said researcher María Marta di Paola, of Argentina’s Environment and Natural Resources Foundation.
In 2018, according to British oil giant BP, global consumption of primary energy (the energy embodied in natural resources before undergoing any human-made conversions or transformations) was 13,865 million tons of oil equivalent (Mtoe), with a predominance of fossil fuels: oil 33.6 percent, coal 27.2 percent and gas 23.8 percent.
Hydroelectricity represented 6.8 percent and sources strictly considered renewable (solar, wind, geothermal, marine, biomass) contributed just 561 Mtoe, or 4.04 percent.
The Paris Agreement, aimed at adapting to and mitigating the climate emergency, establishes that developing countries will take longer to comply with the agreement and that the reductions to which they commit will be made on the basis of equity and in the context of their fight against poverty and for sustainable development.
But in the face of the crises caused by the pandemic, many of the 196 signatory countries, “seeking to take advantage of their installed capacity and regulate impacts on employment and consumption, will relax environmental standards and miss the opportunity to begin a clean, fair and inclusive energy transition,” said Di Paola.
Lisa Viscidi of the Washington-based think tank Inter-American Dialogue said that “although rates of return are currently higher for renewables than for fossil fuels, there are indications that it will be difficult to attract investment in solar or wind energy before demand recovers.”
View of a gas plant in Abu Dhabi, United Arab Emirates, a major oil exporter. The outlook of abundant oil and lower prices in the midst of the crisis points to intense demand for and use of fossil fuels in the short and even medium term. CREDIT: ADNOC
She cited “the plunge in demand for electricity due to the self-isolation (to curb the spread of COVID-19), which strongly impacts the auctions of renewables, leading to their cancellation” – a reference to the mechanism for buying and selling electricity between suppliers and distributors.
With the collapse of oil prices, governments like those of Latin America “will not be inclined towards renewable energy for now, calculating that it could have higher costs,” said Viscidi, head of the energy area in her organisation.
But also when the current world health crisis ends, “the post-pandemic economy will pose insurmountable obstacles for many countries in the global South to achieve a transformation of their energy mix,” said Alejandro López-González, an expert in sustainability from the Polytechnic University of Catalonia in Spain.
This, he argued, is because “the transformation of the energy mix in countries of the South depends on trade in commodities with industrialised countries,” that is, on securing good markets and prices for their products, which provide revenue with which to adopt cleaner energy sources.
Throughout the developing South, the global recession will result in fewer exports, business closures, job losses, lower tax revenues and reduced investment, according to projections by multilateral bodies, leaving capital- and technology-intensive initiatives, such as solar or wind farms, without resources.
Currently, in the developing South, only India, with solar and wind energy plants, and Brazil (wind and biomass) are attempting to keep up with the giants that possess large non-conventional clean energy installations: China, the United States, Germany and Japan.
In 2018, renewable energies represented only 9.3 percent, or 2,480 of the 26,615 terawatts (1 Tw = 1 billion kilowatts) of electricity generation in the world, versus 10,100 Tw contributed by coal, 6,189 by gas and 4,193 by water sources.
Peter Fox-Penner, head of Boston University’s Institute for Sustainable Energy, said in an article distributed by The Conversation that “Economy-driven demand reductions, which are likely worldwide, will hurt new renewable installations.
“Utilities will tighten their budgets and defer building new plants. Companies that make solar cells, wind turbines, and other green energy technologies will shelve their growth plans and adopt austerity measures,” in the context of the global recession, he wrote.
But “Countervailing factors will partly offset this decline, at least in wealthy countries,” Fox-Penner said. “Many renewable plants are being installed for reasons other than demand growth, such as clean power targets in state laws and regulations,” and public pressure that forces utilities to close down coal-fired power plants, he added.
The outlook for oil
Along these lines, Venezuelan economist José Manuel Puente predicted that “the energy transition will happen, there are more and more regulations, electric and hybrid cars, and the problem for Venezuela, Nigeria or Mexico is that we will remain poor countries with deposits of black sludge underground.”
López-González is also in favour of countries like Venezuela – with an enormous potential for wind energy due to the strong, constant trade winds that blow in the northwest – fully exploiting their hydrocarbon resources in order to finance changes in their energy mix.
But these strategies were suspended for members of the Organisation of Petroleum Exporting Countries (OPEC), and for other crude oil producers, when oil prices collapsed to the point that on Apr. 20 they reached negative values, for the first time in history.
U.S. benchmark West Texas Intermediate was quoted that day on the New York futures market at -37 dollars per barrel, 50 dollars below its opening price that day of 13 dollars.
The prices plunged because, as stockpiles overwhelmed storage facilities, buyers did not want to be forced to receive agreed shipments for delivery on that “Black Monday”, and preferred to assume the cost of getting out of the commitment.
That day illustrated the decline in demand that had already started before the arrival of coronavirus in Europe and the Americas, and which gave rise in March to a supply reduction agreement between the 11 OPEC partners and 10 other exporters.
The recession triggered by COVID-19 will mean that the world will consume 30 percent less this year: 70 million barrels a day of oil, down from 100 million in 2019.
This oil crisis “brings very bad news for producers in the Gulf, Russia, Mexico, Venezuela and others: it is the end of absolute income, and the extreme minimisation of the differential income of oil,” said Habalián, a former Venezuelan ambassador to OPEC.
For years, oil exporting nations benefited from setting reference prices for oil before it reached the markets. And in addition, due to the wide gap between costs and prices, they piled up profits that are being pulverised by the current crisis.
Also affected are dozens of companies facing bankruptcy since the growing demand and strong oil prices had allowed them to extract, mainly in the United States, shale oil and gas by means of fracking (hydraulic fracturing), an environmentally questionable technique.
Finally, the energy landscape will be impacted by the behaviors that consumers adopt in the wake of the pandemic – such as their use of energy or demand for travel – or by changes in labour relations after the extensive experiment in off-site work as a result of the COVID-19 self-isolation.
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By Aldo Caliari
WASHINGTON DC, Apr 29 2020 (IPS)
On April 17, the Alberto Ángel Fernández administration in Argentina officially unveiled its offer for debt restructuring on USD 66 billion foreign currency-denominated bonds. Starting on that date, the offer is valid for 20 days, a period during which difficult negotiations with bondholders are expected to take place. Based on the first reactions from some of creditor groups, one could well get the sense that the offer is “dead on arrival.”
Aldo Caliari
Those who watched Argentina’s last debt restructuring will inevitably feel a sense of déjà-vu. In 2001, Argentina defaulted on debt amounting to about USD 80 bn. Sovereign debt restructurings were concluded in 2005 and 2010 obtaining cumulative adherence by more than 92 percent of creditors. The protracted legal battle by the minority holdout creditors to get paid the full amount of their credits plus interest was called by many the “trial of the century.” It did not end well for Argentina, which ultimately, in 2016, had to abide by the US courts’ decision and pay about USD 10 bn.Then, as now, Argentina asserted that significant debt reductions were necessary to restore the economy to a situation of growth and debt sustainability which improves chances of repayment in the future. Then, as now, creditors would refer to Argentina’s behavior as “unreasonable” and “unilateral,” accusing it of failing to engage in dialogue with the creditors and lacking good faith.
In any situation of insolvency, it is perhaps inevitable that the views of debtor and creditors about the haircut that creditors should take will differ. In the domestic context, the institution of bankruptcy was created precisely to provide a rules-based, predictable framework to address and sort out such differences. It is unfortunate that, in the international context, a similar institution does not exist. That means that Argentina and its creditors go into this process against, with a few variations, the same stark “law of the jungle” institutional backdrop that was there almost two decades ago.
In a bargain whose outcome is left to the sheer strength of the parties, some amount of initial posturing seems hardly avoidable. The fact that the previous restructuring has left scars on both the country and the creditor community does not help. However, amidst the déjà-vu, three important differences between the previous restructuring and the current one should, arguably, merit close attention.
First, Argentina’s claim about the extent of restructuring needed to place the economy again on a growth track is, this time, supported by the International Monetary Fund. Back in February, the IMF characterized Argentina’s debt as unsustainable, estimating that restructuring needs would amount to USD 55-85 billion over the next ten years and that there is no room for foreign currency payments in the next few years.
Argentina has crafted an offer that prudently stays within the lower range of these estimates while combining debt interest and principal cuts in a way consistent with the IMF’s projections. Additionally, the IMF Managing Director recently expressed that Argentina is acting in good faith. This is quite a different situation from that in the early 2000s, when the IMF labelled Argentina’s negotiations with creditors as not being carried out in “good faith.”
Second, this offer comes against the dramatic backdrop of a Covid 19-induced economic crisis with unprecedented features such as the combination of both a supply and demand shock and previously unseen falls in commodity prices. Forecasts for the world show the worst contraction since the Great Depression, at least 3 percentage points, in the next year.
Forecasts for the South America region are even gloomier, with indicators showing a 5.3 % contraction is likely. This scenario amounts to dramatically different external and internal conditions than the demand and commodities boom that Argentina and the region were experiencing in the early 2000s. At that time, one could understand investors fighting tooth and nail to share on what could be foreseen as a high growth story to come. But current conditions suggest contractionary measures could only deepen a vicious cycle of lower spending and recession. In fact, had the IMF assessment of Argentina’s debt sustainability been conducted a couple of months later, it probably would have had to advise significant bigger haircuts.
Third, perhaps most important, there is no denying that saving lives and dealing with the health emergency should come as a first priority for the Argentinian government. This is not only the right thing to do for humane reasons, but also because that is a necessary condition for limiting the economic harm.
On this count, in terms of per capita cases and of acceleration rate, Argentina’s performance in flattening the curve stands out when compared with those in the region and in similar conditions. It actually ranks ahead of countries with significantly more resources. But this came at the cost of resolute action to shut down the economy, with the inevitable damage to revenues. It also put an additional burden on public spending to ensure lockdown measures could be followed by all and mitigate impacts on the most vulnerable. In turn, when the health crisis recedes, a speedy and robust recovery will only be possible to the extent that company and job losses have been averted. This will also call for significant stimulus spending.
Bondholders’ initial reactions seem to be driven by longstanding instincts developed in a different scenario. It will be in everybody’s best interest if they can recognize that the current debt restructuring represents a dramatically different situation.
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