88
Inclusion and Resilience: The Way Forward for Social Safety Nets in the Middle East and North Africa
25 and 58 in Egypt in 2008–09 (Cichello and Marotta 2011), but the effect was more pronounced for women, after controlling for initial levels of earning. Growth in remittances slowed to an 8.5 percent increase between 2007 and 2008 (in dollar terms) compared with 16 percent annual growth in the previous five years. The slowdown might not have affected poverty directly, as remittances typically go to better-off families, but it did affect the social balance in labor-sending countries in the region (World Bank 2010b). The political upheavals that began in 2011 have also had an economic impact, with disruption to daily commerce and the uncertainty surrounding the ultimate outcomes. In most cases, Middle Eastern and North African economies were able to rebound when the focus of the Arab Spring shifted from mass demonstrations to elections. Such macro shocks (food price shocks, global financial crises, the Euro crisis, and so on) are expected to continue. The increasing volatility of commodity prices, as well as close links between the financial sector and the real economy, will likely increase the frequency of price shocks in the Middle East and North Africa relative to the 1980s and 1990s. The increased integration of the region’s economies with international financial markets as a result of liberalization and structural reforms has brought many benefits (such as greater foreign direct investment). However, market irregularities elsewhere in the world now translate into greater economic growth shocks locally. Food price shocks in particular have a high impact in the region because as much as 50 percent of consumed food is imported.
Coping Strategies Show Resilience or Vulnerability The impacts of high and volatile food prices on poverty, food security, and social cohesion are severe in many countries (World Bank 2012d).10 The most common household responses to the 2007–08 crisis were to reduce the quality and quantity of meals consumed. In addition, households reduced nonfood consumption, sought more working hours, or diversified their income sources. Migration, and sometimes reverse migration, was another common response. Asset sales and loans from family and kin also provided important cushions for households. These trends can be organized into signs of vulnerability and resilience, as shown in table 2.8. Many of the coping strategies listed in the right column can lead to lasting welfare losses. In addition, box 2.3 describes coping strategies in the Republic of Yemen not necessarily captured in quantitative surveys but important nonetheless.
Mitigating Effects of Social Resilience—and Safety Nets Crises can also frustrate expectations for upward mobility. Shocks can have social and psychological impacts during the critical formative years of a young person’s life, with the severity depending on the person’s age
The Challenge: Poverty, Exclusion, and Vulnerability to Shocks
89
TABLE 2.8
Household Coping Strategies in Response to Systemic Shocks Evidence of resilience Living off savings Migrating internally for opportunities Adapting business strategies Cutting back nonessential spending Extending working hours Working more jobs Striving to keep children in school Returning to education or training Engaging in communal meals Joining mutual support groups; seeking support from family and friends Establishing savings or credit groups
Evidence of vulnerability Cutting back basic consumption; fewer and less-nutritious meals Cutting back essential nonfood consumption Forgoing health care Selling assets needed for livelihood Accumulating unserviceable debt Dropping out of school; sending children to work; switching from private to public school Engaging in high-risk income generating activities Depleting community support networks Engaging in theft, crime, drug selling Resorting to divorce and abandonment, alcohol and drug use, high stress levels, domestic violence Exhibiting lower resilience to other shocks
Source: World Bank 2012d.
BOX 2.3
Household Coping Strategies in the Republic of Yemen Quantitative data do not often capture household coping strategies. Focus groups with rural communities in Omran governorate and in Noukem in Sana’a were conducted in 2010 to study the impact of the food price crisis on vulnerable households. The most common response in both rural and urban areas was that people reported eating differently, cutting out meat and chicken and relying more on vegetable stews. People ate smaller meals, making meals stretch, and skipped breakfast (especially affecting children who had to wait for lunch to be fed). Rural women said they gave children bread dipped in tea or mateed (a yogurt and tahini mix), whereas two years ago they could afford juice, meat, and fish. Some respondents reported chewing qat more often because it suppressed their appetite. Spending on other items and community events, such as weddings, also declined. There were reports of increased Source: Hossain et al. 2010.
child labor, particularly begging or vending at street traffic lights. Overall, the dominant message was that urban parents tried to keep their children in school and cut costs elsewhere. In rural areas, however, respondents thought that more children had been removed from school to work (for example, to sell qat). In the capital city of Sana’a, an increasing number of women sought home-based work or outside jobs. Depending on their level of education and skills, women found janitorial, hospital, or domestic service jobs, or they joined the police and armed forces. This was noted as a source of tension, as some men did not like competing with women for jobs, and some male household members disapproved of women working. The strain on households also resulted in noneconomic impacts, including reported higher levels of stress, more household disputes, and increased domestic violence.