Regional Report: Asia and the Pacific

Transcription

1 Collective Consultation of NGOs ON EDUCATION FOR ALL Consultation collective des ONG SUR L ÉDUCATION POUR TOUS Consulta Colectiva de las ONG SOBRE LA EDUCACIÓN PARA TODOS ED/EFA/2010/PI/9 The Implications of the Global Financial Crisis for NGOs Working Towards the Achievement of Education for All Regional Report: Asia and the Pacific Background paper prepared for the Fifth Meeting of UNESCO s Collective Consultation of NGOs on Education for All (CCNGO/EFA) by the Campaign for Popular Education (CAMPE) January 2010 This paper was commissioned by UNESCO as background information for the preparations of the Fifth Meeting of UNESCO s Collective Consultation of NGOs on Education for All (CCNGO/EFA). It has not been edited by UNESCO. The views and opinions expressed in this paper are those of the author(s) and should not be attributed to UNESCO. The paper can be cited with the following reference: Background paper commissioned for the Fifth meeting of UNESCO s Collective Consultation of NGOs on Education for All (CCNGO/EFA) For further information, please contact ccngo-efa@unesco.org

2 Implications of the Global Financial Crisis for NGOs working towards the achievement of Education for All The Asia-Pacific Regional Report A Regional Report Prepared by CAMPE in Collaboration with the Collective Consultation of NGOs in EFA (CCNGO/EFA) UNESCO Headquarters, Paris Prepared By Manzoor Ahmed Institute of Educational Development, Brac University Member, Education Watch Advisory Board January 2010 Campaign for Popular Education (CAMPE) 5/14 Humayun Road, Mohammadpur, Dhaka 1207, Bangladesh Phone: , , , Fax: , enam@campebd.org; info@campebd.org; Website:

3 List of acronyms and abbreviations BRAC Building Resource across Community, a national NGO CAMPE Campaign for Popular Education (CAMPE) CARE An international NGO CCNGO/EFA Collective Consultation of NGOs on EFA CRC Convention on the Rights of the Child (UN) EU European Union EFA Education For All FDI Foreign Direct Investment GDP Gross Domestic Product GMR (EFA) Global Monitoring Report IDA International Development Agency, The World Bank IDS Institute of Development Studies, Sussex IFCD Innovative Forum for Community Development, Nepal ILO International Labour Organization LDC Least Developed Countries MDG Millennium Development Goals NGO Non Government (voluntary development) Organisation NWFP North West Frontier Province of Pakistan NFOWD National Foundation of Organizations Working with Diasablities ODA Official Development Assistance UIS UNESCO Institute for Statistics UNDP United Nations Development Programme UNESCO United Nations Educational, Scientific and Cultural Organization US Unites States (of America) 2

4 Table of content Acknowledgements Introduction Regional patterns of the financial crisis impact on education development... 9 The context and diversity of the Asia Pacific Region... 9 Character of the Crisis in Asia The economic trends The transmission of impact Effects of the crisis on socioeconomic development The impact on education finances and programmes Role of NGOs to protect marginalized groups in the region New opportunities for NGOs Getting out of the crisis: priorities and responses Suggested Policy Priorities Specific role and responses of NGOs Conclusion and recommendations

5 Acknowledgements We would like to express our sincere gratitude to all individuals and organizations involved in the preparation of the study. This synthesis is the result of collective efforts and could not have been prepared without the contribution from a number of CCNGO/EFA members and other civil society organizations, education experts, UNESCO staff members, and other professionals. Our special thanks are due to the CCNGO/EFA Coordination Group members and networks for their contribution to preparation and revision of the regional report. These include Campaign for Popular Education (CAMPE) Bangladesh, Pakistan Coalition for Education (PCE), National Coalition for Education (NCE) India, Innovative Forum for Community Development (IFCD) Nepal, and Civil Society Network for Education Reforms (E-Net Philippines), along with some Bangladeshi national organisation like Antaranga Samaj Kallyan Songstha (ASKS), Association for Women Empowerment and Child Rights (AWAC), Borendra Development Organisation (BDO), Building Resources Across Communities (BRAC), Caritas Bangladesh, Dhaka Ahsania Mission (DAM), Gonoshasthya Kendra (GK), Intervida Bangladesh, and ROVA Foundation. Finally, we acknowledge the special contribution of Kazi Rafiqul Alam, Rasheda K. Choudhury, and K. M. Enamul Hoque of CAMPE and Grégory Dubois of UNESCO, who guided and supported the work for preparation of the study. 4

6 Abstract This regional study has been undertaken as a part of a global exercise to gauge the effect on EFA efforts, especially of NGOs, of the severest global economic downturn since the Great Depression of the 1930s. Education systems in many poor countries are experiencing the impact of a crisis that originated in the developed world s financial system. There is clearly a danger that the progress towards the Education for All goals may be impeded further, beyond the obstacles the poorer countries already face, by rising poverty, slower economic growth and increased pressure on the government budgets. The international community and national actors including governments and the civil society stakeholders need to assess the danger and act urgently to overcome the obstacles already being encountered and new ones likely to arise in the future. The momentum towards 2015 goals has weakened in many countries across the Asia Pacific region. The recession has aggravated the vulnerabilities of large groups of people and may have driven some of them into extreme poverty, especially in countries where the poor were affected by the food price increases of 2007 and The increased vulnerability of poor households and rising child malnutrition may slow down the efforts to achieve universal primary education and the broader international development targets set for In gauging the impact of the financial crisis and in fashioning the responses to it, insufficient attention has been paid by national authorities to consequences of slower economic growth for financing of education and the effects on household expenditures and other household decisions regarding children s education in the poorest developing countries. By the time economies recover fully from the recession, the crisis could very well leave behind an educationally lost generation of children in the poorer countries. Suggested Policy Priorities. At this time of crisis, the well-being of children must be at the forefront in policy makers minds. A vital area of children s right and well-being is educational services protection and expansion of access and improvement of quality in education. The efforts in advocacy and programmatic actions of NGOs should be directed to: Increasing public investment in children, particularly in high quality education services for all. Strengthening early intervention and prevention services for families as levels of stress in families inevitably increase during a time of crisis. Maintaining and increasing support for the most vulnerable, at risks of a negative change in circumstances, due to unemployment, debt and/or housing difficulties. Intensifying efforts to implement the Convention on the Rights of the Child, applying and promoting the rights-based approach to children s well-being. Trying to limit and challenge the narrow perspective of international and national financial establishments that neglect the human impact of the crisis. National and international NGOs have a watchdog, education and awareness-raising role in this regard. NGOs can engage in advocacy and offer cooperation to the government in designing and implementing activities in specific areas including: a) increasing aid flows, b) reaching the marginalized, c) enhancing social protection, d) partnership development, and e) restructuring international financial institutions 5

7 International action. The developed economies initiated large-scale fiscal stimulus packages for supporting economic recovery which included in varying degree protection of the social and economic infrastructure. Education has been a beneficiary of some of these measures. Most low-income developing countries lacked the capacity to mount financial measures at a desired level and compensate for the adverse effects of the crisis on the education system. Nor has the international community responded effectively with any special measure through official development assistance and other international cooperation activities to address the challenges facing the poorest countries. The international actions that need to be considered urgently include: increased concessional financial support through bilateral aid, the World Bank s International Development Association (IDA) and the regional banks concessional credit windows; a review of the implications of the global economic downturn for the financing of development targets in advance of the 2010 Millennium Development Goals summit; an emergency pledging conference during 2010 to mobilize additional aid for education; budget monitoring to pick up early warning signs of fiscal adjustments that threaten education financing, with UNESCO coordinating an international programme to these ends; revision of loan conditions of IMF and other international financial institutions to ensure consistency with national poverty reduction and Education for All priorities. Civil Society organizations and NGOs cannot compensate, or be the substitute, for the public sector in respect of provision for educational resources. However, as this review has pointed out, NGOs have played a role in advocacy for increased national and international resources for education and has attempted to enhance the efficiency and effectiveness of use of resources. In the context of the financial crisis, these roles of NGOs have become more critical than ever. 6

8 The implications of the global financial crisis for NGOs working towards the achievement of Education for All The Asia-Pacific Regional Report 1. Introduction Background, objectives and methodology The global financial crisis of , originating in the more advanced industrial economies of the north, has drawn inevitably into its vortex the developing countries. However the intense and on-going debate in rich countries about the impact of the global financial crisis has largely ignored its global ramifications, especially its impact on developing countries struggle to overcome their disadvantages. In order to fully appreciate the consequences for the developing world, it is essential that policy makers and stakeholders from both North and South gain an understanding of how this crisis may impact developing countries immediately and in a longer time horizon and the implications for development policy and development cooperation. (McCulloch, November 2008) Countries in the Asia-Pacific region have been affected in varying degrees and in different ways, depending on the structure of the economies and their level of integration into the global economy. There has been an overall negative impact on their economies, their continuing struggle to combat poverty, and their effort to improve and expand essential services, including education. The persistent and negative effects of the global financial crisis are a major source of concern for the achievement of EFA in the Asian and the Pacific region. Now beyond the midpoint of the EFA timetable set at Dakar in 2000, a large number of countries are not on track to reach the 2015 target. Several developing countries in the Asia-Pacific region, especially countries in South Asia, with more than half of the world s illiterate adults and out-of-school children, fall in this category. The financial crisis and its actual and potential fall-out for resources and capacities in the public sector, households and non-governmental organizations threaten to affect adversely the re-doubling of efforts needed to intensify and accelerate progress toward EFA. In this context, through the Collective Consultation of NGOs on EFA (CCNGO/EFA), UNESCO endeavours to assess the implications and impact of the financial crisis for the role and activities of NGOs working towards the achievement of EFA. UNESCO, through the CCNGO/EFA network, initiated collection and analysis of relevant information to gauge the character and extent of the consequences of the financial crisis on education NGOs in different regions. This is expected to complement the surveys undertaken by UNESCO Division for Education Strategies and Capacity Building and the UNESCO Institute for Statistics regarding impact of the crisis on national and international EFA efforts, especially on educational provision and funding. This regional study, along with others, would feed into a global synthesis and inform the discussion at the 5 th meeting of the CCONG/EFA (Dhaka, Bangladesh, March 2010) and guide future activities of CCNGO/EFA. The specific objectives of the regional report are: 7

9 - to present an overview of regional patterns of the financial crisis impact on education; - to explore and illustrate how the crisis has affected activities and capacities, including funding, of NGOs active in education; - to highlight the role and responses, in the context of the crisis, of NGOs in protecting the gains in EFA, especially for the marginalised groups; - to make recommendations for NGOs regarding appropriate measures to fulfil their role. This regional report attempts to synthesize relevant information, literature and evidence available on the implications of the financial crisis on EFA progress, especially on the role of NGOs, in the Asia-Pacific region. The report drew on data and information collected from NGOs in a number of Asian countries (Bangladesh, India, Nepal, Pakistan, the Philippines and Thailand), who responded to the questionnaire. Some qualitative information was gathered from a wider range of countries. 2. Regional patterns of the financial crisis impact on education development The context and diversity of the Asia Pacific Region The Asian continent is the home of approximately four billion people, or about 60 percent of the word s population, though it has 29 percent of the land area of the world. Asia has five of the E-9 countries (nine high population countries) of the world - Bangladesh, China, India, Indonesia and Pakistan. Among themselves, they account for half of the world s population, three quarters of the illiterate adult population of the world and more than half of the children not enrolled in school. Over the past few decades, Asia has experienced dynamic economic growth, and a high level of innovation and improvisation. Within the region, countries have experienced different pace of progress and socioeconomic development. For example, India has become a technological hub and the economies of India and China recorded more than double the growth rate in recent years in GDP than that of North American and Western European economies. The East Asian Tiger Economies (such as the Republic of Korea, Malaysia, Singapore and Thailand) have recovered from the Asian Financial Crisis of , recording impressive growth in GDP since then. In Central Asia, countries have overcome the turmoil in the early 1990s following the dissolution of the Soviet empire and are witnessing an upsurge in economic growth. On the other hand, ten countries in East Asia and Pacific and four countries in South Asia have the Least Developed Country (LDC) status, with a high level of poverty and dependent heavily on external donor for development assistance (UNESCO 2008). Some low-income countries in the region, such as Bangladesh, Cambodia, and Lao People s Democratic Republic, have experienced GDP growth rate of 5 percent or more in recent years. However, many of these countries remain in the bottom half of the Human Development Index - a composite measure of human development based on indicators of life expectancy, education including literacy and GDP per capita (UNDP 2006). 8

10 Countries are also reducing their economic dependency on agriculture, shifting their economic activities to industry and services with higher levels of productivity and income for workers. But even in countries recording rapid economic growth, acute poverty is still the experience of significant proportions of population. For example, the greatest concentration of extreme poverty, accounting for half of the world total, is in South Asia. Despite experiencing annual GDP growth of 10 percent, India had over 80 percent of the people living on less than $2 a day. The pattern of economic growth and investment policies and planning have created unequal geographic distribution of wealth amongst the population in South Asia, China, and in many other countries. Urban areas have greater access to formal schooling, higher-quality education and non-formal education programmes, but the growing urban slums, where the poor are concentrated, remain deprived. In Southeast Asia, the migration and displacement of population, language diversity, need to develop alternative energy sources, issues of deforestation and broader sustainable development, and structural shifts in the economy have created new needs to acquire and upgrade skills for the competitive and rapidly changing labour market. These factors are shaping social and individual goals for education and skill development. The landlocked countries such as Afghanistan, Bhutan and Nepal and those of Central Asia are subject to special constraints. Life and livelihood of large numbers of people in the island nations of the Pacific, the Maldives and the coastal areas of Asia are under threat from the rise of the sea level due to global warming. Other aspects of the fragile environment are affecting people seriously in all countries. Character of the Crisis in Asia The crisis situation is not a new phenomenon at all in many countries of the region. In fact, there has been a continuing state of crisis before the financial crisis exploded - a crisis of massive poverty, food shortage, growing social inequalities and effects of climate change. The recent crisis has added to the vulnerabilities of people in the region. Marginalized groups are those suffering the worst effects of the crisis. The structural nature of the financial crisis arises from an insupportable pattern of consumption in the industrial north financed by huge savings in the emerging economies of East Asia and the financial surpluses of oil-rich West Asia. This root of the crisis suggests that its full impact is yet to be felt by the developing countries. The absence of a serious and systematic effort to recognize and address the fundamental structural problems of the global economy, suggested in the labelling of the crisis as financial rather than economic or structural, poses the risk of the crisis becoming a prolonged one with far-reaching ramifications. It is almost certain that all the consequences and likely impacts are yet to be fully visualized, analysed and understood. The resilience of the economies of the Asia Pacific - even those affected directly by conflict or post-conflict situations such as Afghanistan, Sri Lanka, Timor-Leste, and lately Pakistan - has mitigated somewhat the effects of the crisis. There is a seeming paradox of robust economic performance, increases in external assistance and 9

11 increased budgetary allocations for education in many countries. It is less of a paradox when one looks at the low starting point or base of economic and educational indicators of many of the Asia Pacific countries, the goals that they have set for themselves, the distances that they have to traverse, and the pace of progress that they have to struggle to maintain and cannot now maintain due to the diverse consequences of the financial crisis. With many of the countries in the region characterised by gross economic and social disparities and large proportions of the population living in extreme poverty, life has become more difficult for substantial segments of the population due to the crisis. The crisis has aggravated the vulnerabilities of people for whom natural disasters such as floods and cyclones, and increasingly now the effects of climate change, pose grave hazards. The world-wide food price increases of which put severe pressure on family incomes, reversing some of the recent reductions in poverty, illustrated the extreme vulnerabilities of poor people. The economic trends In aggregate terms, as the economic indicators for selected Asian economies show (Table 1), the countries have remained in the positive territory in the growth of GDP since 2007, although the growth has been slower in 2008 and It is projected to pick up from 2010 onwards. The projections are for a slower pace than in the past, which is a fall-out of the crisis and the expectation regarding the time it will take for the national economies to get back on the path of full recovery. There have been inflationary pressures in most countries affecting quality of living, especially for the poorer segments of the population. The pressure on public and private resources and spending for education will thus continue. Table 1. Selected Asian Economies: Real GDP, Consumer Prices, and Current Account Balance 10

12 Source: World Economic Outlook, April 2009, IMF Data for development assistance show an overall growth and for education for the region. (Table 2 and 3 and Graph 1) ODA showed an upward trend for all regions up to 2005, including Asia, but show a reversal of trend since then. The pattern of sectoral distribution of development assistance does not appear to have been significantly affected so far by the financial crisis (Table 3). It can, however, be said that ODA has remained far below the commitments the development partners made in various forums to fulfill the obligations for achieving internationally agreed Millennium Development and EFA goals. (GMR 2010) Table 2: Official Development Assistance by Regions Current Prices (USD millions) Recipient Developing countries by Region Europe Africa America Asia Oceania unspecified Developing Countries, Total Source: data extracted on 04 Jan :40 UTC (GMT) from OECD.Stat Table 3: Official Development Assistance for Education Particulars Current Prices (USD millions) Year Social Infrastructure & Services Education a. Education, Level Unspecified b. Basic Education c. Secondary Education d. Post-Secondary Education Total Sector Allocable Total ODA ODA for Education as % of social infrustructure and services 25.80% 25.05% 24.31% 19.29% 23.63% 22.43% 20.45% ODA for Education as % of Sectoral support 14.58% 14.39% 13.61% 11.14% 14.36% 13.70% 11.83% Share of Education on overall ODA 8.79% 7.73% Source: data extracted on 04 Jan :40 UTC (GMT) from OECD.Stat 9.07% 5.90% 7.97% 9.08% 8.02% 11

13 Graph 1: Trend of ODA for Education Current Prices (USD millions) Basic Education Secondary Education Post-Secondary Education Education, Level Unspecified Year It can be said that the above aggregate data do not reflect the realities in respect of the diverse and varying consequences for individual countries in their economies, income and employment of people, and quality of life and the state of essential services, including education. The transmission of impact The impact of the crisis has been manifested in the Asia Pacific countries through various channels of transmission or economic pathways, several of which have been noted in an IDS study ( Voices form the South: The Impact of the Financial Crisis in Developing Countries published in November, 2008): 1. Exports. Export growth has slowed markedly in several developing countries. In Bangladesh, orders for ready-made garments from Europe and the US dropped in Year on year exports from the Philippines to the US were down by 15 per cent in The financial crisis has threatened the largest export industry of Bangladesh, ready-made garments, which employ 2.5 million workers, mostly women, and earned annually over 10 billion dollars in export income. Government stimulus packages have been offered to protect export earning, which has increased budget deficit cutting into spending in development and operational budgets of the government. Education budget has remained one of the lowest in the region at slightly over 2 percent of GDP and 15 percent of total government spending. For the industrial sector in Thailand, the textile and apparel industries have seen their orders from both the United States and Europe declining. This trend has led to the reduction of working hours and overtime in many factories. 12

14 Vietnam s export growth has decreased in Economic recession in the U.S. and other major trade partners of Vietnam (e.g., EU, Japan) will possibly continue to restrain Vietnam s export growth rate. 2. Foreign investment. V The global financial crisis has led to greater uncertainty in the financial market that has made banks risk-averse and reluctant to lend. Both portfolio and direct foreign investment have dropped dramatically in several countries as investors shied away from markets that were perceived to be riskier. Vietnam, for instance, is likely to find it more difficult to mobilise external fund; capital inflows such as remittances, Foreign Direct Investment (FDI), Foreign Indirect Investment, and commercial loans may continue to decrease. There is a high possibility of postponement, even cancellation, of implementation and disbursement of some FDI. In Vietnam, as in the other Asian countries where foreign investors hold a significant proportion of shares and bonds in the capital market, they will behave with extra caution. They may realign their investment strategy and restructure investment portfolio, not excluding a withdrawal of capital out of the country. 3. Exchange rate. The sudden withdrawal of foreign capital from several developing countries caused significant falls in their exchange rate. Companies and governments with substantial foreign currency denominated debts may contract or even collapse as a result. For example, the Philippine peso was down 12.3 per cent over the year in The Indian rupee hit a record low to the dollar. 4. Interest rates. As foreign investors withdraw, risk premiums and interest rates have risen for developing countries on global capital markets. Philippine sovereign bond spreads and credit default swap spreads widened in In Sri Lanka, it is reported that the increased cost of funding from overseas markets will make it more difficult to ensure stable balance of payment and to finance development projects in the country, with an implication of growth slow-down. 5. Remittances. A key concern for some countries (e.g. Philippines, Bangladesh, Sri Lanka) is the decline in remittances from nationals living and working abroad. In the case of Bangladesh, official remittances, however, showed an increase, possibly because larger amounts were transferred through safer official channels, although net numbers of migrant workers decreased in 2008 and 2009, which may have adverse effects in the future. 6. Foreign Aid. Although aid from rich countries did not decline in absolute terms, arguably the donor countries failed to live up to pledges they had made in various forums to provide sufficient resources to achieve the EFA and millennium development goals related to education. There are indications that private foundations are scaling down their budget allocations. Effects of the crisis on socioeconomic development In addition to the pathways of impact mentioned above, the IDS study noted and the UNESCO and UIS 1 surveys corroborated the actual and potential adverse effects on 1 In March 2009, the Education Sector of UNESCO undertook a quick survey to assess the impact of the crisis on public expenditure on education in Member States (The Impact of the Crisis on Public Expenditure on Education: Findings from the UNESCO Quick Survey. 30 June 2009,). The UNESCO Institute for Statistics also conducted a study (UIS, Early Impact Assessment of the Global Financial Crisis on Education financing: Country Case Studies, 2009) 13

15 household income and government revenues through declining business activity and higher unemployment. It was pointed out that widespread poverty and now the need to cushion the adverse effects of the global financial crisis on economic growth called for larger government spending, particularly, on infrastructure such as roads and irrigation; health and education; and larger cash transfers to the poor. However, persistent deficits and the generally low tax to GDP ratio in most countries made it difficult for the government to spend more. In Pakistan, power cuts, high fuel costs, rising food prices and the falling value of the rupee have aggravated the sense of economic and political crisis. The minimum public sector monthly salary increased to 6000 Pakistan Rupee (Rs), equivalent to US$90, came down in a year in value to US$72. Many families in the relatively small middle class of Pakistan are fast descending below the poverty line. Reports from the International Labour Organization (ILO) indicated that in emerging economies, like India, job losses will occur in sectors such as construction, real estate, financial services, information technology and the automobile sector. Although China s financial system is still relatively closed and, therefore, its direct risk exposure is limited, the global market slow-down has affected Chinese domestic market confidence. Chinese consumer demand has stayed relatively robust by most measures so far, but analysts worry about the slumping stock market, weakening property prices and signs of rising unemployment. Testimonies of informed observers, as reported in the IDS study, also pointed out an atmosphere of anxiety about the future, discontent about failure to recognize the structural nature of the problem and the approaches to handling the crisis by the economic and political establishment and even distrust of citizens about policies and purposes of measures adopted. It was pointed out by some observers that the responses to the crisis were in many cases confined to measures related to the financial market; the structural causes of the problem were not given due consideration, and the deepening of the vulnerabilities of people was overlooked. (Box 1) Text Box 1 Anxiety, Discontent and Distrust The IDS study Voices form the South: The Impact of the Financial Crisis in Developing Countries published in November, 2008 provides snapshots of the financial and economic effects in several Asian countries. A synopsis of the words of informed observers in these countries brings out expressions of anxiety, discontent and distrust in the public discourse. Bangladesh: The impact of the crisis, its short-term and long-term consequences, and strategies for coping with it have been the prime topics of media coverage, talk shows in the electronic media and of seminars and roundtables, arousing anxieties and shaking confidence about the future. -- Shib Narayan Kairy, Director Finance & CFO of BRAC in Bangladesh. 14

16 China: In the popular media and the Internet, there are various interpretations of the root cause and the long term consequences of the crisis. Some believe that American financial institutions have used financial tools to transfer about one third of their losses to the global financial market. Others see this financial crisis as evidence of the fundamental flaws of global capitalism and the need to rethink the spread of capitalism as we know it in developing countries. -- Dr. Lan Xue is a professor and the Dean of the School of Public Policy and Management at Tsinghua University in Beijing, China. India: It has been argued (e.g., in The Hindu, November 4, 2008) by economists that the crisis demands a fundamental departure from neo-liberal economics and a renewed focus on agriculture on which over 65 per cent of the population depends by urgently implementing a grow more food campaign complemented by large scale public investment that would lead to jobs and add to the supply of basic necessities. -- Benny Kuruvilla is a researcher with Focus on the Global South, based in New Delhi, India. Pakistan: The economists and the research community have advised the government to invest in education, agriculture, and industry and to cut down the defense budget, luxury housing, and civil administration; to what extent this advice will be heeded remains uncertain. -- Dr Tehzeeb Zulfiqar is the Director of Oxford Policy Management UK, Islamabad Office. The Philippines: The print media have largely relied on official briefings and have been communicating the position of the government. Academics, on the other hand, question whether government has correctly described the nature of the ongoing crisis, how it will affect the Philippine economy, and the likely effectiveness of proposed measures. However, a historical mistrust between policymakers and academics have stood in the way of an open dialogue and increased understanding of the economic issues and options by media and the public at large. -- Maria Socorro Gochoco-Bautista is the Bangko Sentral ng Pilipinas Sterling Chair Professor of Economics at the University of the Philippines School of Economics. Sri Lanka: The authorities claim that the relatively small impact of the global financial crisis felt in the local financial market is due to their prudent and stringent regulation. Critics argue that the tight regulation may be more due to the inability to open the market rather than conscious efforts to regulate the market considering the risks. -- Keiju Mitsuhashi works for Japan International Cooperation Agency as representative at the JICA Sri Lanka Office. Thailand: The mindset of most Thai policy makers have not departed from established economic thinking, in which exports and foreign investment remain the driving engines for economic growth, and market mechanisms are considered the best means to allocate resources. The plight of the majority of the people seems to receive short shrift. -- Jacques-Chai Chomthongdi is a researcher with Focus on the Global South, based in Bangkok, Thailand. From the NGO perspective, despite the variety of country circumstances, four general concerns, similar to ones noted above, emerged strongly: 15

17 The concern that exports will decline, or, in many cases already have begun to decline, due to slow growth or recession in the US and some European countries. In Bangladesh, where ready-made garments account for two thirds of the country s total annual export income, as noted above, orders from Europe and the US dropped significantly. The weakening performance of electronics and garments industries is seen as a set-back in the Philippines.. Declining revenue from tourism is also a key concern. Thailand s earnings from tourism declined sharply in Political instability may be contributing, but the crisis is likely to exacerbate this trend. The crisis will also impact on the price of exports the private sector in Sri Lanka is concerned about the falling prices of rubber, tea, coconuts and garments. Vietnamese producers are concerned that price competition will intensify, as large producers such as China increase exports to other developing country markets. The concern that aid will decline. Contributors anticipate a fall in aid receipts from donor countries as they re-prioritise expenditure. Private foundations are already scaling down their budget allocations as private donations and government direct and matching grants to NGOs decline. The concern that remittances will decline. There is strong concern about the impact of the crisis on remittances. The Philippines target for remittance income was US$15 billion in 2008 this may be missed as Filipino workers abroad lose their jobs. But location matters Bangladesh s 5 million expatriates are mostly based in the Middle East and Muslim countries less affected by the crisis, although this also may change as the oil price declines. The concern that foreign direct investment will decline. In a few countries, the impact of the crisis on Foreign Direct Investment for example, in Vietnam, where FDI accounted for over a fifth of total investment, there is concern that planned investments may be postponed or cancelled.(ids 2008) The impact on education finances and programmes In contrast to high quality basic education in some of the countries in the region like Japan, Korea, Singapore and Malaysia, the overall pattern for the large majority of countries in the Asia-Pacific region is of low level of resources for education and low performance of the education systems. A recent review has underscored low public funding in primary education in Bangladesh, increased numbers of dropouts of boys in India, disproportionate allocation of funding between primary and secondary levels in Sri Lanka, lack of capacity of the system in Pakistan, dual enrollment of students in both formal and non-formal education institution in Indonesia, continuing decline in educational performance in Philippines, and low salary of teachers in relation to cost of living in Thailand. It has also noted a lack of parental awareness of free education provisions in Cambodia, low participation of schooling in Papua New Guinea, declining trends of school participation rate in Solomon Islands and relatively low priority to education of the national government in Nepal. 2 The financial and economic crisis is expected to have a negative impact on educational development that already has been far less than satisfactory in many Asian countries. Although it is difficult to assess its magnitude, there have been various warnings about the 2 Asia- South Pacific Education Watch,

18 effects of the crisis on public expenditure on education issued by UNESCO and other development agencies. Based on the UNESCO survey responses 3, it can be said that overall public education expenditure in Asia-Pacific has resisted the effects of the crisis both in terms of its share in GDP and government finance, with a few exceptions. In some cases (e.g. Mongolia, Singapore) governments are calling for maintaining or even increasing educational spending. Public education expenditure, measured in US$ terms and current prices, has increased over the period in more countries than it decreased (as in Kyrgyzstan, Pakistan and Samoa). The prospects for bilateral ODA, however, were seen as uncertain, at least in terms of international commitments to fulfil internationally set goals, although there has been an absolute growth in recent years as noted above. Specific country level information provided by NGOs belies the aggregate assessment, because the vulnerable and the poor suffered disproportionately. It can be concluded that the impact of the crises differed depending on the state of economic development of the country. The negative effects were particularly strong in poorer countries and households reflected in (i) decreasing public finance in real terms for education resulting in worsening learning and teaching conditions in public schools; (ii) increasing private enrolment as affluent families escaped low-quality public schools; (iii) budget cuts in educational spending in some instances at primary and secondary levels, particularly related to Education For All (EFA) goals. It is evident that education budgets are being affected by the current crisis in varying degrees. In several countries, education expenditure for 2009, in real terms, is expected to decline compared to In other countries, although education budgets appear resilient, the increases will be lower than in previous years. In countries where school enrolments are rapidly rising, the negative or marginal growth of education expenditure will actually mean reduction of per-pupil unit costs, cuts in school running costs and a further deterioration of quality in education Text Box 2 The negative effects of the crisis on education and marginalized group: Testimonies of NGOs The quality and character of responses to the CCNGO/EFA questionnaire were uneven, but some contained graphical accounts about the consequences for education of the crisis. A selection of these is presented below. The Civil Society Network for Education Reforms (E-Net Philippines) reported: 3 The findings of UNESCO and UIS surveys presented specific consequences of the crisis for education financing and public expenditure on education in Member States. The findings were based on questionnaires filled by the Field Offices in fifty-one countries; some other information sources were used to complement the country responses to the survey. 17

19 Food basket became more expensive and many Filipino families spent first for food Quality of learning was affected as more children went to school without meals Families spent less on education as they struggled to survive and meet basic needs The overseas Filipino workers were displaced in several countries, which resulted in the migration of their children from private to public schools, thus further burdening the already problematic public schools Inflation deepened poverty, the latter being the single biggest factor that accounts for the increasing number of out-of-school children and youth. National Coalition for Education (NCE) in India said: Although government of India has decided not to take overseas development aid and become self-dependent in terms of education finance, now it is retreating from its position by inviting private partnership. This will lead to a dangerous situation Secondly the quality of education is at stake. Many schools lack full time qualified teachers. The vacant posts of teachers are being replaced by part time unqualified para-teachers There are not enough schools, and hence it will be difficult for all the children to attend school This is all happening because of paucity of funds The poor children from difficult geographical locations who are affected by flood, drought and natural calamities are migrating to urban slums and are being deprived of education Since government schools are not imparting quality education due to lack of infrastructure and teachers, children are bound to go for fee charging private schools. The Innovative Forum for Community Development (IFCD) in Nepal informed that: People who lost their work outside the country returned and also were without work in Nepal. The money they were sending was used to send their children to school. Now they may have to withdraw [their children from school,] Money they earned was also used to build schools in villages. Now they are not in a position to contribute. Bangladesh country case study commissioned by CCNGO noted that: Bangladesh experienced substantial price hike and adverse effects of climate change during last two years [preceding the finacial crisis]. There was a substantial price hike of food grains, fertilizers and fuel in 2007 followed by two devastating cyclones in November 2007 and May 2009 respectively, which have brutally affected the national economy, and particularly the poor.to cope with the situation they lost their small savings, had to sell assets, mortgaged assets/land, took loans, cut back non-food expenditure, reduced food intake, allowed early marriage of daughters, and so on... About 93 percent of the rural and 87 percent of urban households were affected by the food price hike in ; the worst affected case appears to be for the female headed households. The highest impact was observed in case of nutrition status of the children that [led to] dropouts. 3. Role of NGOs to protect marginalized groups in the region In an atmosphere of crisis, as discussed above, community and non-governmental organizations may be best placed to provide immediate support and to respond in a flexible way to new demands and needs. Education support for children may have to be combined with shelter, food, social services in some instances, where households find themselves subjected to loss of income and severe poverty. 18

20 A survey undertaken in Bangladesh to study the effect of rise in food prices in on participation of children in school illustrates situations where NGOs can extend a special hand of assistance. A major increase in prices of rice, pulses and edible oil in early 2008 forced poor families to make dire choices between maintaining consumption of staple food and cutting costs for other items. Dropout from school in both urban and rural areas surged. Poor households could save 9 and 7 percent respectively in monthly expenditures in rural and urban areas by not sending children to school. They could add to monthly income an extra 10 percent by sending the children to work. These vital margins in cost-cutting and supplement to earning spelled the difference between starvation and a square meal for the affected families. (Selim Raihan, Study on Impact of Food Price Rise on School Enrolment and Dropout in the poor and vulnerable Households in Selected areas of Bangladesh, November, 2008) A case study undertaken at the instance of CCNGO/EFA prepared by the Pakistan Coalition for Education, a forum of NGOs active in education, reported that the member NGOs advocated for, or themselves undertook reforms, which were part of a broader reform agenda, but were particularly relevant in the context of the financial crisis. These included: - Abolition of tuition up to grade ten, - Vegetable ration for families as part of promoting primary education for girls in Balochistan, NWFP, and the Punjab, - School nutrition programs. - Scholarship for rural girls at middle and secondary schools, - Free textbooks up to grade ten, - Abolition of school uniform requirements, - Assistance to poor families on a per child basis for attending school, - Scholarships for working children, and - Social safety net programs linked to school attendance. These measures are reported to have been tried and tested with success. The Pakistan report notes, by and large, NGO involvement has been significant and has created significant capacity reservoirs within the country to assist the government and local communities. (Pakistan Coalition for Education, CCNGO/EFA Country Case Studies: Pakistan, draft, p. 17) In the Philippines, the Civil Society Network for Education Reforms (E-Net Philippines) collaborates with Partners in Education for Community Empowerment (PIECE) in the conflict affected areas of Central Mindanao in interventions for out-of-school children, youth and adults. It also works on strengthening the capacities of communities in participatory budgeting for education. It seeks ways of engaging Department of Education Units and the Local Government within the framework of education as a human right. The core advocacy messages of E-Net Philippines, especially relevant in a situation of resource constraints, have been: Learner-centred and developmentally appropriate early childhood care, education and development; quality formal education; life-long, multi-cultural non-formal and alternative learning opportunities; gender-fair education; and increased education resources. (E-Net Philippines, CCNGO/EFA survey Questionnaire Response, 2009) 19

21 In India, a multi-pronged approach has been formulated by the National Council for Education to promote educational initiatives to serve under-privileged communities not reached by services; especially, girls, child labourers, and children in difficult circumstances in those communities. The NCE network has been working together on the issues of the Right to Quality Education, the eradication of Child Labour and the promotion of Child Rights independently and in collaboration with other civil society groups. (NCE, CCNGO/EFA Survey response, 2009). In Bangladesh, as reported in the country case study prepared by CAMPE, several platforms for advocacy towards EFA included CAMPE, Bangladesd ECD network, Bangladesh Shishu Adhikar Forum, NFOWD and Adibashi Forum. CAMPE is a naioational coalition of more than 1,000 NGOs across the country engaged in education program. CAMPE s advocacy initiatives focused on all EFA goals. Education Watch, sponsored by CAMPE, is a civil society initiative to monitor the state effort towards EFA. While Bangladesh ECD network is focused on ECCD, Bangladesh Shishu Adhikar Forum works on CRC, NFOWD on right to education of children with disabilities, and Adibasi Forum on rights of the ethnic and linguistic minority groups. 4. Constraints and difficulties experienced by NGOs at country level The survey questionnaire sent out to NGOs at the country level did not elicit specific or reliable information regarding financial constraints faced by NGOs. A number of reasons stood in the way of useful information. The organizations were sometimes reluctant to provide budgetary information; branches or affiliates of international NGOs did not have full information on hand; some did not feel comfortable about speculating about their funding prospects. Text Box 3 NGOs constraints and difficulties in the current global context: Testimonies In their inputs to the preparation of the regional study, some of the NGOs mentioned specific difficulties they encountered. E-Net Philippines reported that: Due to the financial crisis, our international partner decided to streamline their framework and interventions for education and other programs which resulted in the end of partnership in July E-Net does not have institutional funding currently and sustains its activities through small projects and honoraria from doing research on education. Funds for sustaining the secretariat and budget for national-level campaigns will be affected. The National Coalition for Education in India noted that it has become difficult for the [NGO advocacy] coalitions to organise the advocacy events, research and people-centred monitoring of the school activities as a result of resource constraints. The Innovative Forum for Community Development in Nepal reported that: We are working with marginalised people, such as small ethnic groups, women and girls, the Tarai (the disadvantaged plain land) people, and street and working children. We constantly 20