JOINT REPORT ON THE FIGHT AGAINST POVERTY AND SOCIAL EXCLUSION IN THE EUROMEDITERRANEAN REGION

Transcription

1 JOINT REPORT ON THE FIGHT AGAINST POVERTY AND SOCIAL EXCLUSION IN THE EUROMEDITERRANEAN REGION Working Committee on Health, Consumption, Social Affairs, Education and Culture of the Spanish Economic and Social Council Área de Estudios y Análisis

2 ÍNDICE 1. INTRODUCTION MAIN DIMENSIONS OF POVERTY AND SOCIAL EXCLUSION IN THE EUROMEDITERRANEAN AREA Risk of poverty and social exclusion in the European Union Risk of poverty and exclusion in the MPC CHALLENGES FOR THE FUTURE The demographic challenge Guaranteed access to education and quality education Promoting access to jobs and quality employment Support for entrepreneurship and access to credit Strengthening social protection networks Advances in gender equality Improved governance and promotion of social and intercultural dialogue INICIATIVAS ABORDADAS EN EL MARCO DE LA UE Y LA COOPERACIÓN EUROMEDITERRÁNEA: LOGROS Y LIMITACIONES CONCLUSIONES... ERROR! BOOKMARK NOT DEFINED. CUADROS Y GRÁFICOS... ERROR! BOOKMARK NOT DEFINED. ANEXO 1. INSTRUMENTOS FINANCIEROS DE LA POLÍTICA EUROPEA DE VECINDAD ANEXO 2. PROYECTOS EN MATERIA DE LUCHA CONTRA LA POBREZA Y LA EXCLUSIÓN SOCIAL

3 1. INTRODUCTION The Final Statement issued by the EuroMediterranean Summit of Economic and Social Councils (ESC) and Similar Institutions held in Amman (Jordan) from 17 to 19 October 2012 included in the programme of work for the production of this report on The fight against poverty and social exclusión in the EuroMediterranean region, to be presented at the 2014 Summit. At the Amman Summit, the Spanish Economic and Social Council accepted the commitment to lead and coordinate this Report. Collaboration in the preparation of the report has been received from the Jordanian Economic and Social Council, the Bulgarian Economic and Social Council, the French Economic and Social Council, the Greek Economic and Social Council, the Moroccan Economic and Social Council, representatives of economic and social agents in Tunisia and members of the EU- Turkey Joint Consultative Committee. This Report stems from the common framework of the commitment to combat poverty taken on by the international community with the approval by the United Nations of the Millennium Development Goals (MDG). Based on an agreement by all the countries of the world and institutions in the field of development, the aim is to reduce extreme poverty, to guarantee access to primary education, to reduce child mortality and improve access to health care, amongst other objectives was set as the target year for achieving these goals. The latest reports by United Nations show that significant progress has been made worldwide on some of the goals, such as progress towards universal primary education and the fight against diseases that are traditionally linked to social vulnerability, showing that the MDGs have served as a stimulus for meeting the needs of people in situations of poverty. However, it already seems clear that the main goal of eradicating poverty by 2015 will not be reached (Table 1). This change, however, must be seen in the context of the great changes taking place in the world in parallel to globalisation, which often reduce the global impact of progress in achieving some of the MDGs. They include the ongoing process of climate change, natural catastrophes, the financial crisis, the digital gap resulting from technological change, food and energy crises, violence and armed conflict or the refugee problem. Progressing towards the MDGs is a necessary minimum target but is insufficient for eradicating poverty if we take all the many dimensions of this phenomenon into account. Even if the basic needs and the most severe material requirements were universally met, this would not be the end of development. The eradication of poverty requires that citizens economic and political rights be guaranteed so that they can 3

4 participate in processes of development, becoming a driving force for them, rather than just a mere recipients of aid. In addition, it is becoming increasingly apparent that there is a fundamental link between poverty eradication and sustainable development to the extent that in some international organisations and in the United Nations the idea of a convergence between the MDGs and the Sustainable Development Goals (SDGs) is being widely adopted. In order to meet this huge global challenge, the review of the MDGs and the development of the SDGs are to be combined in a general framework with common challenges and priorities in order to guarantee a decent life for all by 2030 and to offer a sustainable future after that date. The persistence of serious social inequality is now seen to be holding back economic growth in some countries, so it is now increasingly accepted that development has to be inclusive if it is to last. The purpose of this Report is to describe the context for facing the challenge of eradicating poverty and promoting social inclusion in the EuroMediterranean region. Its reflections, conclusions and proposals aim to help establish lines of cooperation for the future in this field. The main dimensions of poverty and social exclusion in the EuroMediterranean partner countries are therefore discussed. These are complex matters, especially considering that the concepts of poverty and of the risk of social exclusion have different meanings in different socio-economic and cultural realities. We identify the challenges for the future in a number of areas in which cooperation could be improved so that preventive action can be taken, fighting the sources of poverty and social exclusion in fields such as education, access to jobs, support for entrepreneurship, equal opportunities between men and women and networks for social protection. Proposals will be made to improve the contribution of the Union for the Mediterranean in this field. The Report amounts to a good opportunity for combining efforts to provide greater visibility of the problem of poverty and social exclusion, bringing it to the centre and identifying policies that can contribute effectively to fighting it. The report is based on work that has already been done in the framework of the EuroMediterranean association of Economic and Social Councils and Similar Institutions. Matters relating to the fight against poverty and social exclusion were covered directly in the Report led by the Portuguese ESC in 2006, The fight against poverty in EuroMediterranean countries, which dealt with both the causes and dimensions, as well as political initiatives related to poverty and how they relate to development of the regions. Indirectly, the origin of poverty and keys for fighting it have partly been covered in other joint reports. Amongst others, it should be remembered that in 2005, the Report Immigration and cooperation among countries in the EuroMediterrean region considered the problem of economic imbalances between 4

5 the northern and southern Mediterranean countries as one of the main causes of the intense migratory flows that have taken place over recent years. The report on Priority actions to be taken in employment policies drawn up in 2008 called for improved human capital as a key for economic and social development in the region, as well as improved quality of employment. The Report on Vocational Training as a factor for competitiveness and job creation: priorities for economic and social agents drawn up in 2010 stressed that, in spite of educational achievements over recent years by Mediterranean countries, the drop in educational participation at higher levels is still marked and young people who drop out early from schooling continue to be very vulnerable to poor labour conditions and social exclusion. The Joint report on young people and employment in the EuroMediterranean region indicates that the informal economy and vulnerable employment do not help a labour market that is already weak to absorb the many cohorts of young people entering it. Finally, the Joint report on immigration in the EuroMediterranean region describes the importance of EuroMediterranean migration policy in the long term for facilitating social, economic, educational, family and cultural interaction in the region as a key element for greater political and economic integration between North and South. These studies amount to a good starting-point as some of their specific goals, particularly with regard to employment and education, are also key elements in the fight against poverty. But all these reflections need to be considered once again in their context, placing a greater emphasis on the fight against poverty and social exclusion as these matters have not received specific or priority attention in the context of the process that began with the Barcelona Declaration. In this context, a self-critical review of the EuroMediterranean partnership process should be carried out when considering poverty and social exclusion as well as the way it combines with other instruments such as the European neighbourhood policy and the European Strategy for the global framework post Today s regional context, which is marked by reflection on the future of this strategy and on financial prospects for 2014 to 2020, affords an excellent opportunity for giving the Union for the Mediterranean (UfM) a coherent strategy and policy, adapted to new situations in the region and giving visibility to the fight against poverty and the promotion of social inclusion. 2. MAIN DIMENSIONS OF POVERTY AND SOCIAL EXCLUSION IN THE EUROMEDITERRANEAN AREA Poverty as a human development problem is the most extreme indicator of unequal growth in the world. It reflects the inter and intra-regional differences in such important 5

6 areas as the distribution of, and access to resources, goods and services and the recognition and actual implementation of basic rights. When it is studied, however, it proves to be extremely complex as it involves a multitude of factors relating not only to income but also to other areas such as access to health care services, education, housing and quality of employment, among others. From this broad point of view, equal opportunities are seen to be a key tool for social inclusion requiring full development of civil, social and cultural rights as an essential part of the fight against poverty. It should also be stressed that lifelong training is another of the main instruments for preventing and combating poverty and social exclusion. The intrinsic complexity of poverty and social exclusion is especially great when the phenomenon is considered in the EuroMediterranean countries. This is partly because of the large socio-economic and cultural differences between the EU and the Mediterranean Partner Countries (MPC) but also because there is great diversity within each regional area and even within each country. These depend on the political situation in the region or municipal area, the type of habitat, religion, ethnic group, and the various cultural traditions that influence the way the problem is dealt with. National situations vary greatly, and some areas, such as northern Africa and some EU member countries, still have to make a lot of progress in this field but are struggling because of the current economic situation. It is difficult to compare data because there are no common indicators for the two regions, and each one habitually uses indicators of different types and with different scope. The EU has a specific indicator for the region which allows the levels of poverty and social exclusion to be compared in relative terms among the different member countries by means of factors adjusted to their economic and social reality. This indicator, known as AROPE (At Risk Of Poverty and/or Exclusion) measures the risk of poverty and social exclusion based on the threshold of relative income but also including other aspects such as the labour situation of household members or the shortage of material resources in them. For countries along the southern shore of the Mediterranean, however, there are no standard indicators so it is necessary to use international indicators from a number of sources. One of the best known is the World Bank s extreme poverty indicator (people living on less than 1.2 dollars a day). This monetary index needs to be taken together with other multi-dimensional data so, where possible, the data provided by United Nations based on the Millennium Development Goals, or the UNDP Human Development indicator are used, as they cover aspects such as life expectancy, access to education and minimum income (Box 1). 6

7 Such analytical difficulties, together with socio-economic and cultural disparity in the region, make it very difficult to compare the two shores of the EuroMediterranean region. However, we aim to offer a diagnosis of each of them so that we can establish the challenges they face individually and together. NEED TO PROGRESS TOWARDS GREATER SOCIAL INCLUSION: A COMMON CHALLENGE IN THE EURO-MEDITERRANEAN REGION Both shores of the EuroMediterranean region saw a good rate of economic growth until the start of 2008 economic crisis. In addition, during that period, important progress was made in social and educational areas that made it possible to improve the quality of life of the inhabitants in general. However, they were not able to sufficiently limit the extent of poverty which was high, though varied in line with the peculiarities and characteristics of each region. Along both the north and south shores of the Mediterranean, the growth models that had been implemented during recent decades proved to have serious limitations and were unsustainable not only from the economic point of view but also socially because they had been insufficient to combat poverty and reduce social imbalances. Moreover, in the EU, after the start of the crisis, the levels of relative poverty and inequality increased, although with marked differences from country to country. The social protection systems which, in some cases, were well-developed, served as automatic stabilisers, especially during the first years of the crisis. However, since the crisis has proved intense and persistent, such systems together with policy adjustments with a high redistributive value have proved insufficient for dealing with the increasing numbers of people in a situation of poverty and exclusion. These are the most extreme indicators of the worsening of living conditions for people in an economic crisis that has now lasted for more than five years and may lead to chronic poverty situations. In addition to the economic, food and financial crisis in the southern Mediterranean countries, there is now concern about the social repercussions of political events in recent years. The appearance of movements advocating political transformation of the region has given rise to violence, even armed conflicts, as well as aggravating the refugee problem, with its serious consequences for living conditions. The progress made in the two regions over recent years has therefore proved insufficient and now seems to have slowed down or stopped altogether although this varies from country to country. Concern about poverty and inequality and their future impact can only increase. 7

8 2.1. Risk of poverty and social exclusion in the European Union The great economic expansion in Europe up to 2007 had positive effects in terms of employment. This growth did not lead to lower levels of inequality and poverty, though still with marked differences between countries, but these were still serious problems in the EU. Specifically in 2007, immediately before the first signs of the crisis, 85 million Europeans (16.7 per cent of the EU population) were still below the relative poverty threshold (60% of the median annual income for the total population after social transfers). In 2010, the European Year for the Fight against Poverty and Social Exclusion, the European Union s incapacity to eradicate poverty became clear, even though this was its target for that year. At the same time, the economic situation was worrying, especially in certain Member States. In this context of uncertainty and concern, the EU 2020 Strategy included inclusive growth as one of its priorities, aiming to achieve a high level of employment which would lead to economic, social and territorial cohesion. The European Commission considered it necessary to define a specific target set so that it could serve as a point of reference for policies on social inclusion. It therefore drew up a definition reflecting the many complex factors involved in poverty and social exclusion, based on three indicators : 1) the rate of risk of monetary poverty; 2) the percentage of people living in homes with very low work intensity; and 3) the material deprivation index (Box 2). According to the European AROPE index, the risk of poverty and social exclusion affected 123 million people in 2012 (the most recent figure), that is, 24.8 % of the European population. However, there are great differences by country. For example, some countries in southern Europe have rates of up to 35% (Table 1). Social transfers are a very important element for preventing poverty and social exclusion in the European Union (the risk of poverty and exclusion for 2012 would have been 44.2% instead of 24.8% without the social transers), although once again the degree of protection differs from country to country. When the AROPE index is broken down, generally speaking the problem of poverty and social exclusion in the EU is still a matter of monetary poverty, that is, a shortfall in income in households which affects 17% of the population. However, the risk of extreme poverty in terms of relative income (40% of the median annual income of the total population after social transfers) is considerably lower, affecting about 8.3% of the European population. Social vulnerability in the EU is not only limited to low-income situations but is clear in the difficulties people face for gaining access to certain goods. Severe material deprivation has increased during the economic crisis, but it is still below the other 8

9 indicators of poverty and social exclusion. This is, however, an important problem in eastern European countries, which clearly indicates that their levels of social wellbeing are lower than those of other Member States. CLOSE LINK BETWEEN POVERTY AND EMPLOYMENT One of the most relevant effects of the crisis is the large increase in households with very low work intensity in the EU, that is, households whose adult members do not work or work much less than they potentially could. The figure is sometimes as little as 17%. This indicator shows, therefore, that the risk of poverty has grown as a result of the increase in households in which all members are unemployed or underemployed (working less than normal working hours), or have temporary contracts with high levels of rotation, or a combination of these situations. As a result and considering population groups, the risk of poverty and exclusion has a particularly marked effect on the unemployed population (67%), for which the percentages are well above the global average and that of other population groups. It should, however, be stressed that there is a high risk of social exclusion and poverty for single-parent households with children (50.8%) and the non-community population (44.5%) (Table 4). It is also important to stress that in the context of the crisis, the risk of poverty and exclusion among the employed population has increased. That is, there is a growing percentage of the population about 13% - that is at risk of poverty in spite of being employed. SERIOUS CONCERN ABOUT THE SITUATION OF YOUNG PEOPLE By age, one of the groups at greatest risk in the EU is the young population, especially young women, for whom the risk of poverty and exclusion is in excess of 30%, although it has been young men that have seen the greatest increase in poverty since the start of the crisis. The economic instability has also had a huge impact on the rates of youth unemployment, reaching an average for the EU of 22.9%, although this concern is greatest in certain southern European countries. Prospects for young people in such countries are very unpromising in the short and medium terms, as labour markets have been seriously damaged and unemployment rates reach as much as 55% in some cases. This has meant that one of the most serious problems in the EU is youth unemployment and the fact that many young people are not only out of work but also have dropped out of school or training. This is a very worrying situation in that it amounts to a very high risk of social exclusion, which affects over seven million young people (10% of the young population). Persistent unemployment is especially damaging at these ages, so employment policies (and policies to reduce school drop-outs) are particularly necessary 9

10 in order to increase employability in a lasting way and keep young people in the labour market at times like today of extended crisis, preventing discouragement and effective de-skilling in cases of long-duration unemployment. Measures have been set up to promote employment for young people, one of the most emblematic being youth guarantee schemes 1. CHILD POVERTY.. Another of the most pressing problems in the EU is poverty among children, which affects 21% of young people aged under 18. This figure is directly related to the socioeconomic situation of parents in this serious economic crisis with high levels of unemployment in certain Member States. Rates of child poverty rise as the rate of work intensity in households decreases and vice versa (Table 5). Especially noteworthy is the risk of child poverty that exists even in households in which the adults rate of work intensity is high (12.2%) or very high (with poverty affecting 7.3% of children). Child poverty is undoubtedly one of the most worrying data today and for the future of the EU, given the large social costs when children experience poverty at an early age and considering the risk that these will be passed on to the next generation. It also points to the need to adapt and improve the efficiency of the social protection system in situations of unemployment where there are children..and THE ELDERLY Because of the scope of social protection systems and, especially, the role played by pension systems, in the EU the elderly population (aged over 55) has a lower risk of poverty than other age groups. In particular, the group of over-65s has the lowest risk of poverty of all age groups, even though they have seen a marked decrease in recent years. The situation for the population aged from 55 to 64, on the other hand, is worrying because in this group the risk of poverty and social exclusion stems mostly from a worsening in their labour situation (Table 4). Unemployed persons of this age are more likely to experience long-duration unemployment and are less likely to find jobs because of their low employability. In addition, their situation often goes together with the unemployment or underemployment of other members of the household, which obviously can lead to extremely serious social situations. 1 The youth guarantee scheme aims to guarantee that all young people aged between 15 and 24 not in education, work or training receive a quality job offer, on-going education, apprenticeship or work practice within four months after ending their formal education or becoming unemployed COM(2012) 729 final. 10

11 PERSISTENT IN INEQUALITY BETWEEN MEN AND WOMEN In addition, the risk of poverty and social exclusion is greater for women than for men even though in general terms the effects of the crisis on the risk of poverty have been greater among men than among women (Table 4), which has reduced the gap between them. However, the gender gap continues to affect women, especially those aged over 55. Special consideration should be given to single-parent families with children, which are usually led by women, whose risk of poverty and exclusion is very high (sometimes more than 50%). Socio-economic vulnerability in such households is very great, especially in situations when there is a loss of income from employment (Table 4) Risk of poverty and exclusion in the MPCs Before the global economic crisis, the countries along the southern bank of the Mediterranean had obtained rates of growth above those in the world in general and in the EU. Such growth came from greater openness to trade driven by an increasing flow of foreign direct investment, improvements in the institutional environment and in economic regulation as well as ample availability of a better-trained work force 2. In addition, the MPCs have been making marked progress in improving their human capital, which is a crucial element for economic development and social cohesion. By allocating annual resources of about 5% of GDP, the region has raised the average number of years for initial training to a level that is only slightly below that observed in the emerging economies of Asia and America. The net rate of schooling at primary level (about 94%) would also have reached levels that were very close to those of the EU-27 (96%) except for the high levels (about 7%) of drop-outs still observed at this stage. Regarding participation in secondary education, levels in the MPCs are still lower than those of the EU. The average for the MPCs was 71% (with net schooling rates) as opposed to 90% in the EU, with some countries recording much lower rates (Table 12). Data on access to a number of basic services and goods including access to new technologies, also indicate the improved living conditions of people in this region. In fact, the development of information and communication technologies and access to mobile telephony has been fairly fast and widespread (Table 8). 2 Joint report on Integrated industrial policies, with a special focus on the energy sector in the EuroMediterranean region, submitted to the EuroMediterranean Summit of Economic and Social Councils and Similar Institutions held in Amman from 17 to 19 October

12 THE SOUTHERN SHORE OF THE MEDITERRANEAN: INSUFFICIENT PROGRESS IN RECENT DECADES Nevertheless, the economic and social development of the region was insufficient to improve the standard of living of the people, especially because the benefits were not fairly distributed. They did not reach the most vulnerable population and this has led to high levels of social inequality, especially in some countries (in which the Gini index is 40.8 (Table 6), and of extreme poverty (people living with less than 2 dollars a day) which reaches 15% in some cases. The United Nations Human Development Index is also very low for some countries in the region, while access to basic goods and services, such as drinking water, power and food is very limited for some people,. There have also been sharp rises in the prices of basic services while subsidies and aid have been cut back as part of strategies for economic reform, which has aggravated social tension in the area 3. Life Expectancy (LE) is one of the indicators that best express social inequality and the varying scope and development of systems for social protection, and it shows marked differences between the different countries. One of the main challenges of the region, therefore, is to fight the persisting situations of poverty and inequality which repeatedly exclude certain population groups from growth and economic progress. Amongst the triggers of this situation are the sharp population increase and the difficulty of creating jobs at a rate that can absorb the growing active population. In 2010, gross income per capita in the southern Mediterranean countries was one third of the average figure for the EU-27. There is, however, great variation from country to country, as there is also within the EU. Moreover, most of the countries in the region have not adopted sound and efficient social politics to deal with social inequality, resulting in very low levels of human development with regard to health, access to social protection and social security, leaving the large proportion of workers in the informal sector as well as those in rural areas without proper coverage. Systems for unemployment protection are poorlydeveloped making the people even more vulnerable whenever there is economic instability. Several reports by the EuroMediterranean Forum of Economic Science Institutes (FEMISE) state that living conditions for the people and social protection systems have to be improved in order to guarantee social stability in the region 4. YOUNG PEOPLE ARE ONE OF THE POPULATION GROUPS THAT ARE MOST AFFECTED BY SOCIAL AND LABOUR EXCLUSION Another aspect to be taken into account, as stated in the Report on Young People and Employment, is that educational and training systems in the MPC do not meet the 3 4 For further information, see: European Commission, EuroMed-20-30, See, for example: FEMISE, Annual Report 2012 or Rapport du FEMIS sur le partenariat Euro- Mediterraneen,

13 demands of the labour market, which has a negative effect on the young population. The consequence is that young people are excluded from the labour market. The higher level of human capital among the young population that results from educational improvements has not gone together with sufficient growth in qualified jobs to absorb such better-trained people, thwarting their expectations. In addition, a large proportion of young people with jobs tend to work in the informal economy or are underemployed. So when young people do find a job it tends to be of low quality. There is also increasing concern about the so-called NEETs, that is, young people not in education, employment or training. The problem is especially serious in the MPCs where, although there are no official figures, about 15-25% of young people and 50-70% of young women are in this situation. That is, about million young people are neither in the labour market (working or searching for a job) nor in training (either the educational system or unofficial training). This indicates a serious imbalance between the social and human potential of these regions and their production model. Integrating young people in social and political life is another matter that is still pending, especially (but not only) in the MPCs. There is very limited participation by young people in democratic life, either through participation in political parties or other social organisations. The capacity of young people to gain access to the information society in general and to social networks in particular is, however, becoming a method of social and political participation that provides an alternative to traditional mechanisms. The employment challenge for young people is not exclusive to the MPCs but it does take on special characteristics in these countries which are undergoing a very intense process of socio-political change. This should create expectations for society in general and for the young population in particular with a view to guaranteeing a stable sociopolitical context. In fact, it is young people that are considered to be behind political and social change in the southern Mediterranean countries. This is a numerically very large proportion of the population which has become very frustrated. They see no rewards in terms of social advancement (through better jobs, amongst other methods) which they expected from achieving higher educational qualificaitons than previous generations. THE RISK OF SOCIAL EXCLUSION PARTICULARLY AFFECTS WOMEN Gender is a clear determinant of poverty worldwide (it is estimated that about 70% of the poor are women), and the southern and eastern Mediterranean countries are no different. Poverty rates are higher for women in all countries, and they have less access to education and paid employment. The EuroMediterranean Summit of Economic and Social Councils and Similar Institutions held in October 2012 in Amman, at which the drafting of this report was approved, called for attention to be paid to the pressing need 13

14 to improve the economic and social situation of women and to promote initiatives to reduce inequality. The greater risk of poverty and social exclusion for women stems from a number of factors, some of them are deeply-rooted cultural factors, which make it more difficult for them to access formal education and the labour market, resulting in a greater risk of unemployment or jobs in the informal economy. Rates of unemployment for women are higher in the MPCs than those for men, and this difference is observed at all ages. In the EU countries, and except for some exceptional cases, such marked gender differences are not found (Table 9). WORSE LIVING CONDITIONS IN RURAL AREAS AND AMONG THE OLDER POPULATION Rural areas, in which about 30% of the MPC population live, report higher levels of poverty and inequality, although there are great differences from country to country. The inhabitants of rural areas have largely been excluded more from economic growth and at the same time have worse living conditions, more difficult access to drinking water, education, health care or other services or infrastructure, such as those relating to the information society. However, in recent years, pockets of poverty have appeared and grown in marginal urban areas, which are fed precisely by migration from the country, which is leading to greater dispersion of this phenomenon. Regional income distribution, which shows great inequality, also indicates that there is a new pattern of distirbution of poverty and exclusion in which the geographical component carries increasing weight. Much of the population living in rural areas is older, which means that this population group is more exposed to situations of social exclusion and to greater difficulties for attaining quality living conditions. Concern for the younger population should not divert attention from the situation of the elderly. Social policies should be drawn up and promoted to make up for the difficulties faced by those who, in many cases, have spent their lives in vulnerable, informal jobs, with very little possibility, or none at all, of gaining access to public protection networks. Also, in rural areas, where the digital gap is more apparent, efforts need to be made to create opportunities offering the new information and communication technologies in order to prevent poverty and achieve social inclusion. 3. CHALLENGES FOR THE FUTURE 3.1. The demographic challenge Both the EU and the MPCs face apparently diverging socio-demographic challenges today ageing and demographic stagnation in the EU as opposed to young societies 14

15 with fast demographic growth in the MPCs. There is, however, a wide range of possibilities for interaction between the two shores of the Mediterranean with a view to promoting inclusive economic growth in the framework of EuroMediterranean cooperation. In fact the demographic differences between the MPCs and the European countries are great (Table 7) not so much in terms of fertility and life expectancy in which, in spite of the differences, the trend is a converging one, as in the population growth rate and the age structure. In spite of the drop in fertility and improved life expectancy in the MPCs over recent decades, their demographic profile is still young, in marked contrast to the older profile of the European countries, where the demographic transition is at a more advanced stage. In the MPCs, the weight of the working-age population is similar to that observed in Europe. However, in these countries the population aged under 15 almost doubles that in Europe, the population aged over 64 weighs one third of that in Europe and, within the potentially active population (aged 15-64), young people predominate. The MPCs show higher population growth than the EU countries, firstly because of their fertility levels which are higher, with a larger fertile population which leads to a higher birth rate. Secondly, while their life expectancy is lower, it has risen a lot in recent years, considerably reducing the death rate. As a result and in spite of the intense emigration from these MPCs, their demographic growth is higher than that in European countries. As in Europe, it is the urban population that is growing most as a result of the rural exodus and the resulting concentration of population in urban centres over the recent decades. In some countries such as Algeria and Turkey, there is already negative growth in the rural population. Unlike the European countries, in the MPCs the population in general is expected to grow, especially the potentially active population, over coming decades. This will lead to a greater demand for education, employment, housing, water, power, transport, etc. and the economic, social and political development of these countries will depend on these demands being met. Bearing in mind the current situation of their labour markets, which are characterised by a very low rate of activity among women and a very high rate of unemployment among young people and women, the increase in working-age population will be a particular challenge for the MPCs. The social and labour market exclusion of so many young people and working-age women prevents the MPCs from benefiting from this human capital which is particularly valuable in terms of development. It must be remembered 15

16 that this group of population is potentially the engine for development if their production expectations and their qualifications find a place in the labour market, but it is also potentially a source of social unrest if their expectations are not met. Great efforts are needed to put an end to this exclusion by creating jobs (which will require restructuring of the production system, organisation of the human capital training system, etc.). Other matters relating to fundamental rights and governance also need to be resolved, such as the inclusion of women in the labour market and an improved system of social protection to meet the needs and requirements of a population which, having benefited from gradual advances in education, now finds itself excluded economically and socially. Reaching this target is one of today s most important challenges. The high rates of economic growth seen in the region over recent years have not been sufficient to put an end to social and labour exclusion and to absorb the millions of young people that join the labour market every year, and they are unlikely to do so in the near future. Apart from situations such as the international economic and financial crisis that has had a particularly serious impact on the EU and the socio-political conflicts that have taken place since late 2010 with the start of the so-called Arab spring, emigration to Europe from the MPCs is expected to continue over coming years, not only because of the above-mentioned structural factors but also because of geographical proximity and the historical links maintained by certain EU Member States with the MPCs. There is a degree of complementarity between the availability of working-age people in the MPCs and the need for labour that will exist in the medium term in many European countries whose populations have grown old and are concerned about the feasibility of their pension systems. The MPC will have to deal with socio-economic and labour exclusion but also with socio-political exclusion now that their societies are better trained and demand their rights. No less important are the consequences of migration because, even though remittances help improve the living conditions of emigrants families and galvanise the country s economy, they still amount to a factor of impoverishment for their countries of origin in terms of the loss of any country s main asset, human capital. Special mention should be made of refugees, a serious problem affecting several of the MPCs and one that has been aggravated considerably over recent years by armed conflicts. When people are displaced from one country to another, not only are they subject to increased poverty and social exclusion but this has an economic and social impact on the receiving countries. There is also a loss of human capital for the countries from which they flee. 16

17 The demand for resources will grow with the population, and people will become increasingly demanding. This will affect education, employment, political participation and other social resources in terms of access and quality but also natural resources and energy. Water has always been scarce throughout the Mediterranean basin and this shortage can be expected to become worse as a result of climate change. Desertification is not only an environmental problem. In addition to its geopolitical importance, access to water is a top-priority social concern as it is strategic for fighting poverty in the region. Access to water is also a basic requirement for materialisation of the right to health. It is a problem that goes together with the limitations of the farming model and that generates the displacement of people from rural habitats to cities, often creating large pockets of poverty and social exclusion around them. There can therefore be no doubt that population growth will be a challenge for the MPCs with regard to guaranteed access for the whole population to this basic resource and the challenge of efficient and socially sustainable management. Demographic pressure also leads to increased consumption of energy resources and increased waste. Fair access to the former and sustainable management of the latter are both dimensions of the energy and environmental policy that have obvious implications in the field of social inclusion, a prospect that can be improved through EuroMediterranean cooperation. In summary, bearing in mind the current state of demographic transition of the MPCs and their prospects for population growth, such countries should undoubtedly take advantage of their full demographic dividend over coming decades to avoid heavy costs for future development. Doing this will be a challenge and will require coordinated action in a number of fields, which would be an ideal context for creating synergies in the framework of EuroMediterranean cooperation Guaranteed access to education and quality education Over recent decades, countries along the southern shore of the Mediterranean have made great progress in education, substantially rasing the average number of years spent in primary education. Participation in this stage of education is currently at similar levels to those of the European Union, and this progress is especially relevant because it improves social cohesion and economic development. It undoubtedly required a special joint effort. However, it is still necessary to improve aspects that hold back inclusive social development, such as the rate of school drop-outs and meeting the needs of the production fabric. Levels of participation in secondary education in the MPCs are still lower than those in the European Union, and university education is even lower. This situation calls for greater attention to be paid to training which is closely linked to economic development, 17

18 because production processes and innovation both require a sound scientific background that can only come from university training. Over recent years great progress has been made in access to education for both sexes, and differences in the rate of schooling for boys and girls have been reduced, in both primary and secondary education. However, there are still marked differences between countries and the gap has not been fully closed, with girls from the poorest homes being three times more likely to not go to school, so greater equality is needed. It is also necessary to strengthen links between schools and parents which have been shown to considerably promote students success at all levels. Increasing the number of children attending school at an early age should also receive priority because this fosters integration in society and at school for students and also improves their academic performance later on. In addition, aspects such as the supply and quality of intermediate and higher education need to be improved to facilitate the transition from education to paid employment, improving employability and eventually reducing the high rates of youth unemployment. These problems also exist in the European Union, especially in the countries along the northern shores of the Mediterranean, where it is still necessary to reduce early school drop-outs and promote vocational training as a means of fostering integration. It is very important to establish adequate quality control of education systems on both shores of the Mediterranean 5. Social and economic development require education systems to offer new skills and competencies so that young people can benefit from emerging forms of socialisation and can contribute actively to economic development in a system in which education is key Promoting access to jobs and quality employment Employment, a fundamental element in processes of social inclusion, is one of the main socio-economic challenges in the Mediterranean countries. Although just before the crisis, most countries in the region had reasonable rates of economic growth, this did not give the desired results in terms of job creation, which was clearly insufficient. The MPCs have an unemployment rate of 11.8% (25.2% among young people aged under 25), while the rate of employment is no more than 42% and the rate of activity for women is only 25.9%. According to Eurostat, in the EU youth unemployment reached 24% in 2013, with much higher figures in some Mediterranean countries, sometimes 5 Ministry of Education, 21st-century skills and competencies for apprentices in the new millennium in OECD countries,

19 even over 55%. Young people with little training suffer most from unemployment but, even if they work, they often find themselves in vulnerable employment situations and they have a greater risk of poverty in all countries. The effect of informal employment in the MPCs, however, is much greater. In the case of young people, two thirds of the population in MPCs are informally employed and therefore form part of the vulnerable employment category which amounted in 2009 for all the MPCs to 28%, well above the figure for the EU. Over the previous ten years, progress was being made to reduce this percentage in the southern Mediterranean countries but the crisis seems to have stopped the trend. In addition, the risk of poverty in employment seems to have doubled in the MPCs today, both because of increased under-employment and because of the return to less productive sectors and activities in which remuneration is necessarily lower. This means that the previous positive trend has turned down, especially in Northern Africa. It should also be remembered that the average rate of activity for women in the MPCs is the lowest in the world 6, almost fifteen points lower than the average for the second lowest area, that of Latin America and the Caribbean. In the Mediterranean countries of the European Union, this participation is also low but with a difference. In them, activity for women is increasing and is closely and positively correlated to the level of training and a drastic reduction in fertility. Meanwhile, in most of the MPCs, there has been no rise in participation by women in the labour market in line with advances in access to education, including increasingly high educational levels and the drop in fertility seen in recent decades in the region. It is, however, possible to talk about a change in the region with regard to activity rates for young people aged 15 to 29, because of both the drop in fertility and their higher average educational level. But the data available do not yet reveal the effects of the crisis on employment for women. Nor do they reveal the negative impact on participation in the labour market and rates of employment for women of processes of political change in the region where, unfortunately, there is great uncertainty about the specific impact on gender equality. In addition, while participation in the labour market by young people aged under 30 is higher, there are at least two issues that might stop this positive trend. Firstly, unemployment for women is very high and, more importantly, it is increasing in parallel with higher educational levels in some cases 7. Secondly, employed women in the MPCs mostly used to work in the public sector (at least in formal employment) which is being 6 World Bank, data base. 7 ILO, Decent Work in the Mediterranean Countries, An Overview,

20 cut back in many cases. They had also specialised in certain activities in the manufacturing sector which are likely to offer much less employment in the near future. While efforts have been made in recent years to place employment on the political agenda for EuroMediterranean cooperation, so far the results of initiatives have been poor. It is also necessary to carry out structural reforms in order to create an environment that is favourable to sustainable economic growth, so that the jobs that a growing and better trained population need can be created. It is also still necessary to adopt short-term employment policies in order to guarantee the right to quality employment and, especially, to take specific actions for the groups that are most likely to end up unemployed. Regarding specific actions for employment, many measures have been adopted. They include actions to improve inclusion in the labour market (aid for employment, guiadance and monitoring of the unemployed and public employment initiatives) and to improve careers, as well as action to promote self-employed work, developing and offering training in entrepreneurship and business management for both SMEs and cooperatives and other forms of social economy. It would, however, be useful to evaluate these actions to find out to what extent they are effective, and to analyse the resources allocated to them, promoting cooperation and the sharing of experiences throughout the Mediterranean. The situation of women needs to be considered separately, as they almost always start out at a disadvantage. Legislation and policies need to be drawn up to prevent discrimination and to promote equal opportunities. In the field of employment policies, efforts must aim to reduce the rate of illiteracy among women, with actions to improve access for girls to education, especially in rural areas; to increase training and skills for young women, preparing them for the labour market; to guarantee that labour rights are recognised, and to design measures to promote work-life balance. It must be emphasised that the existence of an insufficient regulatory framework has helped create a large informal sector in these countries. The Rabat Joint Report of 2008 discussed this issue and how it is related to the underground economy. These are two separate phenomenon (of different origin and with different effects) but they sometimes overlap and are difficult to separate in the available data. They cover both what can be strictly described as the underground or irregular economy and employment and traditional family-type activities involving the self-production of goods and services and the provision of these in a more or less disinterested fashion as part of what are sometimes called neighbourly activities. 20