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The Way Forward for Social Safety Nets in the Middle East and North Africa
Inclusion and Resilience: The Way Forward for Social Safety Nets in MENA brings together new evidence, newly collected data, country-specific analysis, and international experience. It aims to spur the debate among policy makers and civil society representatives about the existing challenges and feasible policy options on how to make social safety nets more effective and sustainable.
DATE: April 19, 2013
PLACE: World Bank Headquarters, Main Complex Building
Keynote Panelist: Sri Mulyani Indrawati, Managing Director, World Bank
Chair & Moderator: Inger Andersen, Vice President, MENA, World Bank
Presenter: Steen Jorgensen, Sector Director, Human Development, MENA, World Bank
Panelists: Nizar Baraka, Minister of Economy and Finance, Morocco
Susana Gamez, International Consultant, Social Protection & Subsidy Reform
- Andersen: Targeted subsidies only hits one-third of MENA region’s poor. Indrawati, former MENA Director at Bank, will share Indonesia’s experience as an economist and academic.
- Indrawati: Who should receive targeted subsidy? When the baby of subsidies are delivered, the result is worthwhile.
- Spending political capital to get through the technocratic and academic exercises.
- Pain cannot be alleviated totally, but it can be lessened.
- Jorgensen: Universal subisidies r inefficient and pro-rich benefit significantly from fuel subsidies, but many people among the poor do as well.
- We need to do categorical targeting of subsidies towards widows…or known as poverty targeting.
- Note the polling we did: Jordan and Tunisia had more confidence in their governments in dealing with social safety net issues than those in Lebanon and Egypt.
- My 3 Takeaway Points: 1) MENA countries spend too much on universal subsidies 2) Social Safety Nets have low coverage of the poor and leakages to the non-poor and 3) social can be reinforced to achieve better impact at low cost.
PP: Is cash better than in-kind subsidies…many of the people WB polled said yes!
PP: Helmy gives Egypt as a case study on subsidies and social safety net challenges:
- Helmy: Country experience regarding barriers:
- 1) citizens have a low level of confidence in government to address social safety net problem
- 2) Formal safety nets: we have many INFORMAL social safety nets…pools of large amounts of cash…if there is good governance and accountability, then they could supplement the government officially.
- 3) Ineffective implementation of laws and regulations
- 4) Labor law: 5 percent are employed are supposed to be w/disabilities
- 5) high technical and administrative costs.
- Kugler (Professor of Public Policy at Georgetown University): Redistributive, Role of providing insureance…but does not serve poor b/c poor are priced out of those markest.
- A couple of problems that emerge w/targeting subsidies problem: 1) Moral Hazard and 2) Stigmitization
- Problem 1: Moral Hazard: encouraging more of the behavior government is trying to prevent
- Example 1: Refers to US program w/TANF, which indirectly encouraged, or provided incentives for women to have children out of wedlock
- Example 2: Encouraging for people to claim unemployment.
- Problem 2: Stigmatization
- Example of children getting free lunches and it being a public shame.
- Andersen: How can we at the World Bankbest assist you based on your observations and research?
- Benchekroun (Morocco: Chief of Mission to the Head of Government, Ministry of General Affairs & Governance): It’s not a simple task because these are not just market and social pressures. It’s a political challenge as well. Any price increase would have a fallout with the poor. Cash transfer solutions were tried in Morocco. We also had an education among the poorest program.
- We have a lot of questions in the government that we don’t have answers for yet…and we traveled to Latin America and Indonesia to gain lessons learned. So we appreciate the World Bank support.
PP: Morocco is trying a variety of programs…and Benchekroun argues that unifying the programs into a single registration system is best. So, is she asking the World Bank to help them with data consolidation via technology software and measurement expertise?
PP: FINALLY, a representative from Arab Civil Society organization speaks! A representative from Tunisia asks how a civil society organization positively engaged with government and a religious organization.
- Jorgenson: Notes smuggling fuel smuggling between Libya and Tunisia due to different prices in neighboring companies.
- Calls on them to collaborate/coordinate prices. Egypt is looking at how they can exempt farmers from subsidies.
- Kim: Difficult, but still aiming to end extreme poverty by 2030. Excited that UN Secretary General has brought multi-lateral institutions to address our targets: people living under 1.25 USD a day is a “stain on our consciousness”
- Kim: In the middle of AIDS epidemic, we still grew over 5% in Africa…despite the economic crisis, developing countries have managed to grow…so the World Bank has been doing a lot of things right.
- Trevor Manuel: We’re preoccupied with measuring GDP. It’s not a sufficient measure for ending
- Yunus: Banking institutions that are inclusive is still a fundamental issue. Since the founding of Grameen Bank, we still need our banking institutions to become inclusive.
- We need Technology to address education…where the children of poorest family can receive education like the richest. You don’t need a school, or a physical teacher, we need a mobile application. Everyone has a mobile.
- ki-Moon: I’ve said that we’ve need your political will and political leadership. There is no such country that has an abundance of resources; now political will is what really matters. That’s why I’m here: to meet with the Finance Ministers to request that they allocate the proper resources.
- When they all come to General Assembly, they agree…but by the time they arrive at the JFK airport, they completely forget!
PP: Love how UN Secretary General called out leadership…without naming names. But maybe he should have in the name of transparency…
- Kim:We need the data to eradicate poverty. It’s not just political correctness to say to put women in the center of the solution.
- If there’s anything we’ve learned from the Arab Spring, it’s that growth without inclusion is not going to work.
- Need to have zero tolerance on corruption…that’s why we debarred a group for 10 yrs for corruption issues regarding building a bridge.
- ki-Moon: Need to have accountability…and countries need to keep their promises. so we’ve included measures on accountabilty…established an Accountability Commission.
- It’s not that we’re lacking in food. It’s about prices and distribution…b/c of that we are suffering from food crisis.
Is this a cynical assessment…don’t think so…just realistic. Strategic bribery: what’s the reality on the ground when informal networks might work better than policy? #ittakes #wblive #MiddleEast
- Carlsson: What about active citizenry. Without empowerment…we’ll repeat the mistakes. We need to move beyond governments.
Sure, so are we giving up on expectations of government…or are we talking about citizen groups who feel that they can use media or NGOs to overturn bad government policies?