Preparing for crises

Crises are likely to be new normal for developing and transition economies. In designing programs to protect the poor against crises, governments face two uncertainties — uncertainty of crisis type and uncertainty of crisis timing.

In the face of these uncertainties, I have proposed three lines of action for governments and for the international community: (i) Conduct a Social Protection Assessment Program which “stress tests” the collection of social protection interventions against a range of possible crises to reveal gaps and vulnerabilities, (ii) Over the medium term, finance improvements in design to addressing these gaps and vulnerabilities, and (iii) offer a pre-qualified line of assistance for social protection which goes into action automatically when crisis triggers are breached.

This is how Ravi Kanbur concludes his short paper on “Protecting the poor against the next crisis”. 


Each of the highlighted points are illustrated and clearly add up to the point Kanbur is making here – crises are always going to be around the corner. Recent experiences have shown that crises (financial, climatic, pandemics etc) can wipe out livelihoods and set back development processes. Irrespective of what might ideally be required in such situations, developing countries will continue to grapple with weak social protection systems due to technical and political compulsions and this is a challenge for all actors in the development sector. 


Kanbur’s ‘stress test’ or the Social Protection Assessment Program (SPAP) could be a great research topic

A wide variety of systemic crises threatens the short run and long run wellbeing of the poor in developing and transition economies. The SPAP, an effort led by the government and supported by the international community, aims to increase the effectiveness of social protection in the face of systemic crises. The work program seeks to identify gaps in coverage and in speed of response of social protection programs, and other relevant national and international programs, viewed as a system; to ascertain development and technical assistance needs; and to help prioritize policy responses.

 

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