By Juliet Morrison
United Nations, Aug 16 2022 – While refugees globally face insecurity and uncertainty, a new World Health Organization (WHO) report highlights that they also face poorer health outcomes.

The World report on the health of refugees and migrants, published on July 20, 2022, was the first to survey studies of various refugee health outcomes, including mental health.

The report highlighted that refugees are not inherently less healthy than host populations but that various social factors, including changes in income, substandard living conditions, and barriers to other services, can result in poorer health and well-being.

Refugees from conflict-affect areas are also at a higher risk of developing mental disorders like PTSD, anxiety, and depression. While rates vary by population and region, one study cited by the WHO estimated the burden of conditions to be 22.1 percent.

But experts caution that estimates of PTSD in the field may be overstated because of the difficulty of discerning a post-traumatic stress disorder (PTSD) response from a normal behavioral response to trauma.

The WHO report also dove into the importance of mental health, which Dr Timothy Mackey, a global health professor at the University of California San Diego, told IPS is often neglected.

According to one report, only 0.3% of international assistance for health went to mental health care between 2006-2016. Refugees can also be excluded from accessing health services in certain countries based on their migratory status.

The neglect of mental health care is often because of limited resources and capacity, added Mackey. Healthcare issues that are more visible and studied extensively tend to be more significant priorities.

“[Mental health] is harder to advocate for than a lot of the more quantifiable diseases like an infectious disease outbreak, or diabetes, or heart disease or cancer, where you may have more compelling global disease burden statistics.”

Despite this, Mackey added that addressing mental health can be a real benefit for countries as treating mental health leads to many positive effects.

“Because there can be such clear acute trauma, and especially in the early stages of the lifecycle with children, [mental health issues] can have very lasting impacts for economic productivity or long-term health outcomes. […] Addressing mental health is a preventative component. It can save health systems money, and it can lead to better long-term outcomes.”

But disorders are only one aspect of mental health. Some academics advocate for treating refugees holistically – taking into account the overall well-being of refugees in addition to visible health problems.

This means examining the social factors affecting a person’s mental state, like living and working conditions. The WHO report revealed that both could play a big role in overall refugee well-being.

According to one study, Palestinian refugees from occupied territories had a reduced risk of mental disorders when they were in secure housing in Lebanon. Another study on Southeast Asian refugees in Canada showed a significant improvement in mental health once refugees had access to the labor market and could generate income.

Hussein Alzribi, a former refugee from Syria, is familiar with how a lack of security can affect well-being. He fled Syria in February 2016 and underwent a brief transitory period in Greece before settling in the Netherlands.

Unable to practice law as a refugee, Alzribi told IPS that his stretch of unemployment felt hopeless.

“I couldn’t practice my profession, I didn’t know who to ask, and I had no money. There was nobody to give me guidance and help.”

He has since co-founded a non-profit that provides coaching to help refugees find employment. His co-founder, Bev Weise, told IPS that their non-profit, Refugee JumpStart, is a great support to refugees.

She said that being employed and generating income makes them feel part of society.

Dr Michaela Hynie, a psychology professor at York University in Canada, echoes this claim. In her research, she’s found many of these problems around refugee well-being to be rooted in social exclusion and systemic problems, rather than individual issues.

She stressed to IPS that many of the concerns of refugees she’s encountered center around a lack of stability and security.

“We default to mental health, which allows us to then say it’s about the individual and they have a mental health problem, and we need to teach them to be resilient as opposed to they’re in a system that is preventing them from establishing the things that we need for mental health.”

She argued that to improve refugee well-being, governments should focus on finding ways for people to thrive and find opportunities.

Most countries do not have policies on refugee well-being. Many are also far from considering refugee health in a comprehensive way that takes well-being into account, Mackey told IPS.

Getting to that place requires prioritizing refugee health. The WHO has stressed this requires focusing on data collection. Refugees are largely invisible from health data because large-scale surveys tend not to disaggregate their results by migratory status. This can make public officials “oblivious” to health issues within their borders.

The WHO stated that more data could enable better monitoring and strengthen compliance with refugee-related Sustainable Development Goal (SDG) targets.

“It is imperative that we do more on refugees and migrants’ health, but if we want to change the status quo, we need urgent investments to improve the quality, relevance, and completeness of health data on refugees and migrants,” Dr Zsuzsanna Jakab, WHO’s Deputy Director-General noted in the report’s press release.

Data collection is necessary for meaningful policy development, she added.

“We need sound data collection and monitoring systems that truly represent the diversity of the world population and the experience that refugees and migrants face the world over and that can guide more effective policies and interventions.”

IPS UN Bureau Report

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By Orlando Milesi
RENGO, Chile, Aug 16 2022 – Local leaders of the Rural Sanitation Services (RSS) warn that the digging of illegal wells by large agro-export companies in Chile is aggravating the effects of drought and threatening drinking water supplies and social peace.

Leaders of these programs also emphasize that the new constitution that may emerge from the Sept. 4 plebiscite would guarantee the human right to water, which would strengthen its management and that of river basins, in addition to facilitating a response to the water crisis to prevent it from triggering protests and social conflict.

Water rights were commercialized during the 1973-1990 dictatorship of General Augusto Pinochet, and between 1994 and 2006 the governments in power during the democratic transition sold the large water utilities to foreign companies, which have controlled the water supply in Chile’s cities since then.

The water supply in rural areas, considered unprofitable by these companies, was left in the hands of the country’s 2,306 RSS, which were institutionalized and transformed into Rural Sanitation Services in 2020 by a legal reform. They operate throughout this long narrow South American country of 19.5 million people and have 7,000 leaders and 6,000 workers.

The RSS, made up of cooperatives, local residents’ committees and other social organizations of different sizes, have the role of guaranteeing the drinking water supply in rural areas, with the State as supervisor and infrastructure provider. It is possible that in the future they will also take on responsibility for sanitation.

These systems benefit 2.1 million people, to whom they provide water at a lower price than the distribution and sanitation companies.

During the COVID-19 pandemic, 90 percent of the RSS never stopped serving their users, and despite the quarantine most of them paid their monthly fees, to maintain the system.

The Directorate of Hydraulic Works (DOH) of the Public Works Ministry told IPS that during the 2021-2022 period it will invest some 57 million dollars in seeking new sources of supply, and in the conservation and integral improvement of the systems. For 2023 the projected investment is 14 million dollars.

Maintenance is an ongoing job at the La Alianza RSS in the town of Choapino, some 105 km south of Santiago, Chile. CREDIT: Orlando Milesi/IPS

Relief for growing water stress

The Chilean economy is based on mining, especially copper, and large agricultural exports, two industries that require large amounts of water in a country with limited water resources.

The result is growing water stress, which accentuates the tension between powerful industries and human consumption and small-scale agriculture, aggravated by the private management of an essential resource such as water.

Against this backdrop, the RSS have alleviated access to water, but as recurrent droughts and other climatic impacts accentuate the water deficit, their role is becoming more difficult, without a substantial change in the right to water.

Francisco Santander, treasurer of the RSS in Quebrada Santander, in the Andes foothills 450 km north of Santiago, told IPS that “the first well we drilled by hand with 20 members in 1999. Now there are 45 of us.”

“The largest 50-meter well was dug five years ago. It is one of the deepest in the municipality of Río Hurtado. We bought a piece of land and applied for a drilling project. The money was provided by the DOH,” he said in an interview from his hometown.

The investment included pumps, a solar panel for energy, gabions (a basket or container filled with earth, stones, or other material), a well and a 50,000 liter tank.

“Last summer, faced with the drought crisis, we sold water to Pichasca (a neighboring town). They asked us for help. We gave them up to four truckloads a day for their tanks and they paid with an emergency subsidy. Our well is holding up well under a moderate level of consumption,” Santander proudly explained.

The solar panel was the first in Rio Hurtado and reduced energy costs by one-sixth. It contributes to the low price charged for water: 1.3 dollars per cubic meter and 2.2 dollars as a basic service fee.

Gloria Alvarado with the RSS in El Patagual, which serves 800 members in Pichidegua, a municipality of 18,000 inhabitants 165 km south of Santiago, was president of the National Federation of Rural Drinking Water and was a member of the Constitutional Convention that drafted the new constitution that voters will approve or reject in next month’s plebiscite.

Speaking to IPS from El Patagual, as a national expert, she warned about the critical water situation caused by climate change and drought, which is aggravated by overuse, poor distribution of rights and deficient watershed management.

A view of the 75-cubic-meter water storage tank installed at La Alianza, in Choapino, where the office also operates to attend to the needs of members and receive payment of their bills. The users of these rural sanitation systems, which are common in Chile, are not usually late with their payments, because thanks to these systems they have water in a country where water management has mostly been privatized. CREDIT: Orlando Milesi/IPS

“Petorca (a municipality 205 km north of Santiago) has a very green side with avocado plantations, but has another where the people have no water to drink and are supplied by water trucks. It is difficult for a 50-meter RSS well to compete with a 200-meter well,” she said, complaining about the agro-export companies.

She also alluded to the heavy use of water by forestry companies in southern Chile and mining companies “which until recently had no obligation to report their water use,” as they now do thanks to Article 56 of the new Water Code.

In Chile’s central valley, the plantations of fruit exporters have expanded exponentially, without any limits on their expansion, which has left many areas at water risk, Alvarado said.

“There is no land use planning or protection of the ecological function of the land. Today rural drinking water is at serious risk because there is unequal competition between those who extract for human consumption and those who extract for commercial and industrial use,” she said.

“Seventy-nine percent of water rights are in the hands of one percent of Chileans. It is inequitable and many families suffer the consequences,” she said, complaining that an essential resource has been transformed in Chile into a tradable commodity.

José Rivera is the administrator of the 500-family RSS in La Alianza in Choapino, in the municipality of Rengo, 105 km south of Santiago.

The town is part of the central region of O’Higgins, the largest exporter of fruit, wine, pork and chicken, “which basically means it exports water,” he said during a visit by IPS to the La Alianza facilities. As a result, he said, “we used to make 30-meter wells here, today we dig 100-meter wells, and in the nearby municipality of Machalí we dig 200 meters.”

According to Rivera, who is secretary of the National Federation of RSS Chile, another problem in O’Higgins is that for the last 10 years wells have been dug stealthily and without oversight.

“Farmers have so many plantations that they began to extract groundwater and make clandestine wells. There are thousands of wells” that nothing is known about and which are subject to no controls, he said.

Their RSS has two wells: one is 80 meters deep and the other 100. One collects water in a 75,000-liter metal tank and the other in a 200,000-liter concrete tank. A third 200,000-liter tank is planned.

“Before, we were basically the only ones who used groundwater. Today the agribusiness companies are replacing river water with groundwater and we have no inspectors in the General Water Directorate. They have no resources and no authorization to enter a farm,” Rivera said.

One solution, in his opinion, would be the use of drones to investigate unregistered wells.

“The biggest problem, and I’m speaking for the association, is that there is a war of wells. If I dig a 40-meter well, the farm will dig a 100-meter well and so on and so forth. The State will not have resources and neither will we. And there will be another outbreak of social unrest,” he predicted.

Rivera calls the situation “a silent water earthquake,” after touring the region and seeing the thousands of hectares of land planted.

“The coastal dry land is full of olive trees, where there were none before. Pichidegua is full of avocado trees. It is a crime because we have no water. The powerful, who own 500 or 1000 hectares, take water from here and transport it to the hills, where there are more and more plantations,” he said.

Meanwhile, “there are small farmers with five or six hectares who are without water,” he said, describing the situation as “serious, a powderkeg.”

José Rivera, administrator of the La Alianza RSS, checks the instruments of the new flow measurement system that indicates, second by second, how much water is in the tank and how much is being consumed in the water starters installed in the houses of each of the members of this rural sanitation system, a social organization unique to Chile, which alleviates the water deficit in the country. CREDIT: Orlando Milesi/IPS

Water as a human right

Alvarado said the solution to water management lies in the new constitution.

The text approved by the Constitutional Convention “will redistribute the right to use water,” she said. “It will put an end to the ownership of rights, which will be converted into use authorizations.”

She said that one of the origins of the water crisis is that there is an over-granting of rights that exceed the actual water sources and that there are very few water inspectors.

“An autonomous National Water Agency will be created and there will be integrated basin management in which users will be on an equal footing,” she said.

Rivera said the large landowners deceive small farmers by telling them that if the new constitution is approved they will be left without water, while “the constitutional proposal actually states that water is a public good.”

A step in the right direction

He highlighted, as a positive step, the promulgation in April of this year, under the government of leftwing President Gabriel Boric, of the reformed Water Code “for which we fought for 15 years.”

“The new law is very good because it protects rural areas and indicates that no one can ask for a concession in a rural area. They cannot privatize. Urban sanitation companies cannot enlarge their area of operation,” he stressed.

“We were recognized as RSS and today we can dig wells and draw water if it is for survival and basic consumption,” he added.

“Nobody wanted to change the Water Code, nobody wants to change the constitution…who is ‘nobody’? the economic powers-that-be. They do not want to change. We have to change,” he argued.

By Ngozi Okonjo-Iweala, Rebeca Grynspan and Pamela Coke-Hamilton
GENEVA, Aug 16 2022 – We are in the toughest period the world economy has faced since the creation of the multilateral system more than three-quarters of a century ago. A quadruple shock of COVID, climate change, conflict and cost-of-living has undone years of hard-fought development gains.

As financial conditions tighten, even countries that had seemed on track to prosperity and stability now stare into the abyss of debt distress, fragility and uncertainty about the future.

Coordinated, multilateral action is necessary to tackle the crises we face. Both aid and trade have key roles to play in reversing the impacts of this quadruple shock and putting the world back on track to achieve the Sustainable Development Goals.

We head the three international agencies that comprise the Geneva trade hub – the World Trade Organization (WTO), UN Conference on Trade and Development (UNCTAD) and the International Trade Centre (ITC).

The WTO makes and monitors the rules for global trade. UNCTAD delivers research and consensus-building to guide governments. ITC helps small business go global, especially firms led by women and young entrepreneurs. We work together so that trade works better for development.

All three of us share a deep commitment to trade-led prosperity. All three of us understand that a world in crisis means no more business as usual. And all three of us want our organizations to “walk the talk” on making aid and trade deliver for real people.

To guide aid and trade towards a better world, policymakers need to pivot in three fundamental ways.

First, make trade greener. Global trade can play an important role in a transition to a low-carbon economy. Preliminary research at the WTO suggests that removing tariffs and regulatory trade barriers for a set of energy-related environmental goods would reduce global CO2 emissions by 0.6% in 2030 just from improved energy efficiency, with additional potential gains from innovation spillovers and as lower prices accelerate the shift towards renewable energy and less carbon-intensive products.

Second, make trade more inclusive. Promoting greater trade by small businesses and greater participation by women and youth make companies and countries more competitive, drives economic transformation and reduces poverty.

Yet ITC business surveys found that one only out of every five exporting companies is women-led. WTO data show that micro, small and medium-sized firms represent around 95 percent of all companies globally but only one-third of total exports.

Third, make trade more connected. In our networked world, the future of trade is through digital channels and platforms, especially for small businesses. During the pandemic, we saw how doing business online went from being useful to critical for survival. UNCTAD data shows that digitally delivered services reached almost two-thirds the level of global services exports.

These themes were discussed at the Global Review of Aid-for-Trade, which took place 27-29th July in Geneva.

The event took place one month after the WTO’s successful Twelfth Ministerial Conference, which put trade multilateralism back on track and delivered a landmark agreement on fisheries subsidies, and two months before the COP27 meeting in Egypt (November 6-18) that could determine the world’s chances to keep the 1.5C target alive.

The data shows promising signs that aid-for-trade is tilting towards greater sustainability, inclusivity and connectivity. OECD and WTO data reveal a record high of nearly US$50 billion in aid for trade disbursements in 2020, of which half were either climate or gender related, and one-third supported the digital economy.

Despite growing budgetary pressures at home, it is critically important to continue and increase these aid-for-trade flows.

Apart from a stronger thematic focus on sustainability, inclusivity and connectivity, maximizing the contribution of aid for trade to achieving the Sustainable Development Goals requires a resolute focus on the “where” and “how” of delivering development results.

This means a focus on those countries whose trade and development needs are highest – particularly Least Developed Countries and fragile/conflict-affected countries – and regional initiatives like African Continental Free Trade Area, to ensure they become stepping-stones to wider and more inclusive regional value chains and trade-led growth.

It means partnership across international organizations. The WTO, UNCTAD, and ITC already collaborate on initiatives like the Global Trade Helpdesk, which simplifies market research by bringing key trade and business information into a single portal, as well as on support to cotton-exporting countries in Africa.

Last but certainly not least, it means mobilizing public and private finance. The IFC estimates a worldwide US$300 billion financing gap for women, and the global trade finance gap has nearly doubled from an already-staggering $1.5 trillion. Without access to finance, firms cannot grow, diversify or formalize.

We want to end with a call to action. Creating a more sustainable, inclusive and connected future is the moon shot of our times. Aid, trade and multilateralism – working together – are part of the solution.

It is normal and understandable that governments act to shore up their own economies in troubled times. But we must act now to ensure that the world’s poorest and most vulnerable can still see a pathway to prosperity through global trade.

The joint opinion piece is authored by Ngozi Okonjo-Iweala, Director-General, World Trade Organization, Rebeca Grynspan, Secretary-General, UN Conference on Trade and Development, and Pamela Coke-Hamilton, Executive Director, International Trade Centre.

IPS UN Bureau

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By Anis Chowdhury and Jomo Kwame Sundaram
SYDNEY and KUALA LUMPUR, Aug 16 2022 – Half a century after the 1970s’ stagflation, economies are slowing, even contracting, as prices rise again. Thus, the World Bank warns, “Surging energy and food prices heighten the risk of a prolonged period of global stagflation reminiscent of the 1970s.”

In March, Reuters reported, “With surging oil prices, concerns about the hawkishness of the Federal Reserve and fears of Russian aggression in Eastern Europe, the mood on Wall Street feels like a return to the 1970s”.

Anis Chowdhury

Stagflation in the 1970s
Worse, it seems few lessons have been learnt from the last stagflation episode. There is no agreed formal definition of stagflation, which refers to a combination of economic stagnation with high inflation, e.g., when unemployment and prices both rise.

When growth is weak and many are jobless, prices rarely rise, keeping inflation low. The converse is true when growth is strong. This inverse relationship between economic activity and inflation broke down with supply shocks, particularly oil and other primary commodity price surges during 1972-75.

Non-oil primary commodity prices on The Economist index more than doubled between mid-1972 and mid-1974. Prices of some commodities, e.g., sugar and urea fertilizer, rose more than five-fold!

As costlier energy pushed up production expenses, businesses raised prices and cut jobs. With higher food, fuel and other prices, rising costs, coupled with income losses, reduced aggregate demand, further slowing the economy.

Fed chokes economy to cut inflation
Years before becoming US Fed chair in 2006, a Ben Bernanke co-authored paper noted, “Looking more specifically at individual recessionary episodes associated with oil price shocks, we find that … oil shocks, per se, were not a major cause of these downturns”.

Jomo Kwame Sundaram

They concluded, “an important part of the effect of oil price shocks on the economy results not from the change in oil prices, per se, but from the resulting tightening of monetary policy”. Their findings corroborated others, e.g., by James Tobin.

Following Milton Friedman and Anna Schwartz, other economists also found “in the postwar era there have been a series of episodes in which the Federal Reserve has in effect deliberately attempted to induce a recession to decrease inflation”.

The US Fed began raising interest rates from 1977, inducing an American economic recession in 1980. The economy briefly turned around when the Fed stopped raising interest rates. But this nascent recovery soon ended as Fed chair Paul Volcker raised interest rates even more sharply.

The federal funds target rate rose from around 10% to nearly 20%, triggering an “extraordinarily painful recession”. Unemployment rose to nearly 11% nationwide – the highest in the post-war era – and as high as 17% in some states, e.g., Michigan, leaving long-term scars.

Interest rate hikes reduced needed investments. Outside the US economy, these sharp and rapid interest rate hikes triggered debt crises in Poland, Latin America, sub-Saharan Africa, South Korea and elsewhere.

Earlier open economic policies meant “the increase in world interest rates, the increased debt burden of developing countries, the growth slowdown in the industrial world…contributed to the developing countries’ stagnation”.

Countries seeking International Monetary Fund (IMF) financial support had to agree to severe fiscal austerity, liberalization, deregulation and privatization policy conditionalities. With per capita incomes falling and poverty rising, Latin America and Africa “lost two decades”.

Stagflation reprise
The IMF chief economist recently reiterated, “Inflation is a major concern”. The Bank of International Settlements has warned, “We may be reaching a tipping point, beyond which an inflationary psychology spreads and becomes entrenched.”

Central bankers’ anti-inflationary efforts mainly involve raising interest rates. This approach slows economies, accelerating recessions, often triggering debt crises without quelling rising prices due to supply shocks.

Economic recoveries from the 2008-09 global financial crisis (GFC) remained tepid for a decade after initially bold fiscal responses were quickly abandoned. Meanwhile, ‘quantitative easing’, other unconventional monetary policies and the Covid-19 pandemic raised debt to unprecedented levels.

GFC trade protectionist responses, US and Japanese ‘reshoring’ of foreign investment in China, the pandemic, the Ukraine war and sanctions against Russia and its allies have reversed earlier trade liberalization.

Higher interest rates in the rich North have triggered capital flight, causing developing country currencies to depreciate, especially against the US dollar. The slowing world economy has reduced demand for many developing country exports, while most migrant worker remittances decline.

Interest rate hikes have worsened debt crises, particularly in the global South. The poorest countries have seen an $11bn surge in debt payments due while grappling with looming food crises. Thus, developing country vulnerabilities have been worsened by international trends over which they have little control.

Lessons not learned
Supply-side cost-push inflation is very different from the demand-pull variety. Without evidence, inflation ‘hawks’ insist that not acting urgently will be costlier later.

This may happen if surging demand is the main cause of inflation, especially if higher costs are easily passed on to consumers. However, episodes of dangerously accelerating inflation are very rare.

Acting too quickly against supply-shock inflation can be unwise. The 1970s’ energy crises sparked greater interest in energy efficiency. But higher interest rates in the 1980s deterred needed investments, even to reverse declining or stagnating productivity growth.

Raising interest rates also accelerated recessions. But similar commodity price rises before the 1970s’ and imminent stagflation episodes – involving energy and food respectively – obscure major differences.

For instance, ‘wage indexing’ – linking wage increases to price rises – enhanced the 1970s’ inflation spiral. But labour market deregulation since the 1980s has largely ended such indexation.

The IMF acknowledges globalization, ‘offshoring’ and labour-saving technical change have weakened unionization and workers’ bargaining power. With both elements of the 1970s’ wage-price spirals now insignificant, inflation is more likely to decline once supply bottlenecks ease.

But the wage-price spiral has also been replaced by a profit-price swirl. Reforms since the 1980s have also enhanced large corporations’ market power. Greater corporate discretion and reduced employees’ strength have thus increased profit shares, even during the pandemic.

In November 2021, Bloomberg observed the “fattest profits since 1950 debunks wage-inflation story of CEOs”. Meanwhile, the Guardian found “Companies’ profit growth has far outpaced workers’ wages”.

Corporations are taking advantage of the situation, passing on costs to customers. The net profits of the top 100 US corporations were “up by a median of 49%, and in one case by as much as 111,000%”!

Meanwhile, many more consumers struggle to meet their basic needs. Interest rate hikes have also hurt wage-earners, as falling labour shares of national income have been exacerbated by real wage stagnation, even contraction.

Hence, policymakers should ease supply bottlenecks and address imbalances to accelerate progress, not raise interest rates causing the converse. Thus, they should rein in corporate power, improve competition and protect the vulnerable.

Allowing international price rises to pass through, while protecting the vulnerable, can accelerate the transition to more sustainable consumption and production, including cleaner renewable energy.

IPS UN Bureau

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