ABSTRACT
Originating in the US mortgage market, the financial crisis rapidly spread across rich, emerging and poor countries and turned itself into the worst economic turmoil worldwide after the Great Depression of 1929. Although the crisis is far from over, many emerging-market countries have now started growing close to pre-crisis rates, while OECD countries have resources and instruments to cope with it and mitigate its effects on displaced workers and vulnerable people. By contrast, poor countries are still well below their trend of output growth and lack the appropriate tools to deal with these multiple external shocks. Thus, the poorest people in the poorest countries, those who are the least responsible for the crisis, end up being the most exposed to the global recession: not only do they lack sufficient safety nets for immediate help, but also, more importantly, they are going to be dramatically affected in the long run by the likely reduction in social spending. The United Nations (2009) stresses that the financial crisis is jeopardizing the achievements of the Millennium Development Goals: poverty ratios, indicators of hunger, child malnutrition, gender equality and unemployment all worsened in 2008. A new generation of poor might not benefit from the recent (limited) progress in education and health, with severe consequences for individuals and local communities. The most recent World Bank estimates, for example, suggest that lower growth rates in developing countries, due to the twin food/fuel and financial crises, would trap an additional 89 million people in poverty, to be added to the 130-155 million people pushed into poverty in 2008 (World Bank, 2009). Besides, the economic and food crises have increased the number of the
undernourished worldwide to more than one billion people, the highest level since 1970 (Food and Agriculture Organization, 2009). As the World Bank President Robert Zoellick admits, the consequences on infant and child mortality could be dramatic:
[W]e estimate that as a result of the sharply lower economic growth rates, between 200,000 and 400,000 more children a year may die, and that’s out of a total of about 1.4 to 2.8 million children that perish each year.
