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New report highlights international poverty hotspots most at risk from Covid-19

Written by Vidya Diwakar

Press Release

A new report from the Overseas Development Institute calls on governments to prioritise their poorest citizens to help halt the spread of COVID-19 as well as to prevent the pandemic from exacerbating poverty hotspots.

‘From pandemics to poverty’ finds a strong link between poverty levels and capacities to cope with humanitarian crises and disasters. Limited access to healthcare and weak governance means that the pace of transmission of COVID-19 in high-risk countries will easily surpass their ability to cope. South Sudan, Chad, Somalia, CAR and DRC – all in sub-Saharan Africa – are found to have the weakest coping capacities.

Hotspots of vulnerability, however, are not limited to the poorest countries: lower middle-income countries (such as Nigeria, Cote d’Ivoire, Zambia and Yemen) with large pockets of people living in poverty, low public spending in relation to the share of people in poverty, and weak healthcare systems are at risk of suffering worse health outcomes.

Vidya Diwakar, Senior Research Officer at the Overseas Development Institute, says:

“In the international response to COVID-19, the furthest behind must be supported to limit transmission and lessen the negative impacts on welfare. There needs to be a focus on ‘hotspots’ of vulnerability to poverty. This includes countries facing multiple risks, with weak healthcare systems and limited coping capacities, as well as people in poverty or at risk of falling into poverty.”

Furthermore, public health measures to tackle COVID-19 risk adversely impacting those already furthest behind. Social distancing and border closures have become cornerstones of national responses, but these limit informal modes of work, contribute to food insecurity and restrict pathways out of poverty. While governments are currently concerned with halting the spread of the disease, the long-term risk is that poverty is exacerbated through a vicious cycle of disease, destitution and death.

To circumvent poverty hotspots, ODI’s report urges governments to:

1)  Ensure assistance is sensitive to the needs of the poorest people. There may be a trade-off between public health measures and the likely heavy economic and food security impacts that these will create. People in or near poverty may not be able to cope with these secondary impacts.

2) Strengthen health systems and increase access for people in or near poverty. Provision of basic handwashing necessities and water (e.g. in slums) can also help reduce the rate of transmission. Currently, there are stark differentials in access to basic handwashing facilities, and clean water and sanitation services in rural vs urban areas of countries, and in LICs compared to LMICs and UMICs.

3) Continue and/or expand existing pro-poor interventions across a range of sectors and invest in risk-informed development. This should include an emphasis on food production, social protection, and schooling.

ODI’s research also highlights how weak health systems contribute to ill-health related impoverishment. In the absence of adequate public health expenditure or insurance coverage, many poorer households opt for healthcare only in response to emergencies rather than preventative measures. When pushed, they then engage in distress coping strategies, such as selling assets, taking out loans, or liquidating savings, all of which can also prompt impoverishment. Sierra Leone, Afghanistan, Uganda and Cambodia top the chart of low income countries with high rates of impoverishment due to out-of-pocket health spending alongside high rates of catastrophic health expenditures; while, within lower middle-income countries, Bangladesh, India, and Nigeria have high rates of catastrophic expenditure and high impoverishment due to out-of-pocket health spending.

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