How adaptive social protection can help mitigate the spread of hunger caused by the war in Ukraine
Photo: Paz Arando/Unsplash
A high-level panel discusses the role of adaptive social protection measures in the efforts to curb global food supply shortages and price shocks as war ravages
On 24th March, 2022, the ASPects series presented a timely and thought-provoking webinar on social protection measures aimed at mitigating the ripple effects of the war in Ukraine. Edward Archibald, Lead Technical Adviser of STAAR (Social Protection Technical Assistance, Advice and Resources), facilitated this roundtable discussion with senior panellists from the World Food Programme (WFP), the World Bank (WB), United Nations Children’s Fund (UNICEF), and the Food and Agricultural Organisation (FAO), alongside the government of Germany. The ASPects series is supported by the Global Programme Social Protection Innovation and Learning that Deutsche Gesellschaft für International Zusammenarbeit (GIZ) implements on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ).
13 million undernourished people are on the horizon
Putting in place a set of risk management measures that aim at preventing, managing, and overcoming price shocks that adversely affect the wellbeing of the poorest and most vulnerable people is no easy feat, yet the nature of Russia’s invasion in Ukraine presents never-before-seen consequences for global food security and energy prices. Dr Tania Vorwerk, Director of Global Health, Pandemic Prevention and One Health, in the German Federal Ministry for Economic Cooperation and Development (BMZ), underscored the need for further immediate emergency support and emphasised a solemn certainty that if the war results in prolonged reduction in food exports by Ukraine and Russia ‘forecasts suggest that the global number of undernourished people could increase by 8 to 13 million people, already next year (2023)’. Lastly, Dr Vorwerk emphasised the importance of functioning social protection systems in all countries to help mitigate the effects of large-scale shocks.
What has happened so far and what can we expect in the medium term?
Holger Matthey, Senior Economist from the FAO, paved the wave for the discussion and shared some of FAO’s insights and projections on the global food market situation and outlook. FAO’s analysis shows that price increases in staple food, fuel and fertiliser and other ripple effects of the conflict are having a dire impact on the poorest rural communities. Already prior to the crisis prices of basic foodstuffs were at an all-time high due to crop conditions but also high prices of energy and fertiliser. Start with wheat, of which Russia and Ukraine are, respectively, the largest and fifth-largest exporters in the world. According to the FAO, 26 countries rely on Ukraine and Russia for at least 50 percent of their wheat imports.
Compiled for the Director General of the FAO to present to G7 leaders, rough estimates showed that in a moderate scenario, if 10 million tonnes of wheat are taken out of the global market for one year and with oil prices raised to 100 US dollars per barrel, then the prices of all major crops increase by 10%, doubling in a severe scenario, with acute hunger rising by an additional 11.2 million people in the medium term. Again, Mr Matthey highlighted that the processes simulated are complicated and evolving, and other factors play a role when working on the ground.
Data and evidence to inform price shocks
Sam Muradzikwa, UNICEF Zimbabwe’s Chief of Social Policy and Research, succinctly described three practical ways that national actors look out for when it comes to mapping the effects of price hikes. First, national policy makers will look at their trade profile ‘to track how, where or what impacts are likely to happen as a result of price shocks’. Second, national actors will look at global, regional and local supply (value) chains, which saw a disruption over the past two years due to Covid. Similarly, impacts of this nature will happen as a result of price shocks. Third, actors will look at inflationary expectations or behaviour, for example, if many people start hoarding products such as sunflower oil, this creates the soaring inflation that is feared. Finally, when considering sub-Saharan Africa (SSA), where Mr Muradzikwa currently resides, the informal sector is a large part of employment in African cities. The urban informal sector is heavily import dependent. He stressed that price shocks have devastating impacts on livelihoods, but more importantly on vulnerable groups reminding the audience ‘now imagine you throw a shock on top of an already vulnerable group of people, and that could create a number of systemic challenges especially for social protection interventions.’
Think, prepare and act like an insurance company
Sarah Loughton, World Food Programme’s Chief for Social Protection, explained that the first thing to keep in mind is that ‘shocks only become crises when people are unable to cope with them’. She further explained ‘that social protection programmes that countries have in place already, are already going to be helping to mitigate the impact of these price shocks or indeed of any others.’ While she acknowledged that countries need contingency plans, risk financing coordination, and institutional arrangements she aptly pointed out that any new strategies needed are best worked out ex-ante. Ms Loughton eloquently quoted Stefan Dercon, the former Chief Economist of the United Kingdom’s International Development Department: ‘We all need to be thinking more like an insurance company, which means thinking in advance ideally about what are the risks we are preparing for? Who owns this risk when this thing happens – a price shock or any other and who’s responsibility is it to do something about it?’
Three Rs to take from the Covid response: re-activate, recalibrate & resume
‘There have been 670 new programmes introduced – that’s almost 90% of the response on the cash front is through new programmes’ declared Ugo Gentilini, Global Lead for Social Assistance at the World Bank. He voiced that before jumping into introducing new programmes for high food prices we have the opportunity to tap into the Covid response in different countries. He urged the global community to look at what exists and consider re-awakening some of the Covid programmes that were recently phased out and that could be resumed and built upon to inform future ASP responses. The Covid response reached an impressive 760 million people via digital payment mechanisms, which could be adapted and recalibrated to price shocks i.e. making them food security and nutrition-sensitive.
Challenges: different ministries, different mindsets and different mentalities
When asked which actors are relevant in social protection responses to price shocks and the implications for existing coordination mechanisms, Marco Knowles, Senior Protection Officer of FAO, revealed that the Ministry of Trade and Ministry of Agriculture have a role to play. He explicated that it is important to generate a supply response in the local markets that low-income households are living in as well as shifting the demand towards foods that are less affected by the hike in food prices. In the case of SSA, it could be about triggering a shift to the vegetables and grains that are produced locally, such as cassava and millet. A new policy would require the coordination and cooperation between the ministries of trade, agriculture, health and nutrition. However, the ministries of trade and agriculture, who traditionally consider themselves responsible for the economy, do not necessarily mix with the ministries dealing with social issues like health and nutrition. Mr Knowles pronounced ‘it’s a challenge’.
Putting women and girls at the heart of ASP programme design
Mr Muradzikwa explained that those who are most affected by social protection programming today – women, girls and vulnerable communities – must be involved in the design of these response actions to ensure the equal sharing of benefits. He highlighted that ‘we need to ensure that population level data is always disaggregated by age, by gender, and by disability…()…so that we are able to report on the exact number of girls and women that are being reached by the programme’. Mr Muradzikwa spoke about cash transfers (assistance distributed as physical bank notes, e-money, mobile money, through debit cards or value vouchers) having unintended consequences of exposing women to gender-based violence, and from his own experience in Ethiopia, he pointed out there is a lack of empirical data on how different implementation arrangements influence the realisation of gender equality outcomes.
Linking humanitarian assistance and social protection
There was a resounding ‘yes’ from Dr Gentilini who stated that ‘there is a lot of energy around the convergence between social protection and humanitarian assistance’. He highlighted that social protection features prominently in recent guidance on humanitarian assistance released by Europe’s largest humanitarian aid actor, ECHO. However, the issue of parallel systems persists. To make social protection systems more adaptive Dr Gentilini outlined three areas which could be taken from the humanitarian sector: early warning systems, measuring markets, and an index linking transfers to inflation.
Take home messages
As the webinar concluded Dr Gentilini summarised the core takeaways from the elaborate discussion as follows:
1 – Diagnose and look at how the crises is panning out in different countries because it’s going to be different;
2 – Consider food security and nutrition responses, and not standalone social protection responses – all of us have underscored the multisectoral approach of the problem – because it’s a system problem:
3 – Stress that’s how far you can go with social protection systems – scale up, identify the gaps and look at the wealth of lessons that are emerging from Covid and possibly when designing options.
Mr Archibald thanked all panellists for their contributions and invited everyone in the audience to join social protection experts’ global community of practice: socialprotection.org
Rupal Shah-Rohlfs, May 2022