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Southeast Asia is highly vulnerable to the effects of climate change, it is located at the edge of a massive landmass in between large oceans; and over 50% of the population still depends on climate sensitive sectors such as agriculture. The effects are already being felt; typhoons in the Philippines are now four times more frequent, sea levels are rising and floods are one of the top concerns for cities in the region.
How is a region that is undergoing rapid urbanization while being home to 60% of the world’s indigenous people adapting to climate change? Successful adaptation strategies have a multidimensional approach: institutions, infrastructure and community should all be considered for building true resilience.
Nonetheless, a multidimensional strategy requires significant resources and coordination; as it is shown in this bulletin, such strategies are still not the norm.
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What’s inside Bulletin #23?
- Overview of Climate Change in Southeast Asia
- Fighting against the forces of nature?
- The Storm is coming: Adaptation Trends in Southeast Asia
- Adapt or Drown!
- Navigating the urban hierarchy
Public health in urban areas has been and will continue to be affected by global population trends. More than 50% of Southeast Asia’s total population is projected to be living in urban areas by 2025, which will exert additional pressure on urban health systems.
In general, public resources can be concentrated at lower cost in cities, which is effective in public health interventions through basic primary health care like immunization, clean water and waste disposal.
However, as this bulletin will demonstrate, these improvements in public health are not equitably accessible to all parts of society. Even major cities in the region such as Jakarta and Manila have large slums that are deprived of healthy living conditions. Not only are health centres difficult to access, the most basic amenities such as sanitation and piped water are also scarce.
What’s inside Bulletin #22?
- Urban Poverty and Health in Asia
- Protecting the health of Asia’s Urban Poor
- Healthcare-seeking behaviour in slums
- The unhealthy impacts of poor water and sanitation
- Unregistered and excluded: the government healthcare problem
One look at Asia’s skylines and the casual observer gets the impression that Asia is truly rising. The top ten financial centres in Singapore, Hong Kong, Tokyo, Shanghai and Taipei, followed by Kuala Lumpur, Mumbai, Bangkok, Beijing and Seoul tell a story of rapid growth and new wealth. However, with 1.5 billion people without access to conventional financial services, Asia is also home to the majority of the world’s unbanked.
In the East Asia and Pacific region alone, 55% of the population is unbanked. It is estimated that the total number of people without access to banking services is between 2.2 and 2.5 billion people.
What’s inside Bulletin #21?
- A moral imperative for action
- Evidence from the ATM survey on urban poverty
- Facilitating finance in slums
- Destitute poverty: the final financial frontier
- Outlook: the future of financial inclusion
The next Asian Trends Monitoring Bulletin will be released on Monday, September 16th. We show you a preview of some of the data and survey findings that will be published in Bulletin #21:
We are looking forward to your feedback on ATM Bulletin #21: Financial Inclusion for Asia’s Poor on Monday.
Providing reliable financial services in slums has its complications. Slums present a challenging environment for financial services, which traditionally ensure regular repayment through securing collateral and knowing their clients’ exact residences. Most slum dwellers are rural-urban migrants with informal jobs, highly fluctuating incomes and little stability in their lives. Often, they do not own any substantial assets to use as collateral. They are also more anonymous, as slums do not have conventional “addresses” and changes of residence can happen overnight.
It is easy to see why microfinance providers struggle to enter this high-risk market with services that are affordable for the poorest of the poor. Asymmetric information problems make it more difficult to identify the right clients. Secondly, the costs of attracting and retaining staff in urban environments are higher, pushing up the final costs of the financial services offered to the urban poor. The end result is that MFIs often cannot serve the bottom of the pyramid. Nevertheless, some organizations are specifically targeting the poorest of the poor.
Education is a vital tool for breaking the vicious cycle of poverty. Indeed, it is often claimed that educated children will be able to earn more money in the long run, eventually lifting the entire family out of poverty. This, in turn, leads to the future generations being better educated and able to enhance the financial well-being of families and communities. However, reality is rarely that simple. A 2006 OECD report on education notes that economic and social disadvantages are equally important elements to consider as they can severely hamper the educational experience of learners. While social disadvantages influence test scores and educational achievements in the developed world, in the developing countries of Southeast Asia, economic and social disadvantages are severe impediments to even accessing and attending school.
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Despite efforts by nearly all governments across Southeast Asia to provide access to free education until secondary level, there remain several stumbling blocks that lead to low enrollment rates and unsatisfactory educational outcomes. For example, there are often additional costs beyond the tuition expenses, including the opportunity cost of foregone income from the child working to support a parents business or engage in independent economic activity. Poor service delivery represents another problem, where subsidies and other forms of assistance do not reach the poorest households.
Sonxai’s business is located in the heart of Vientiane. She sells bird eggs, a local delicacy, from a street stall. The eggs are weighed and packed into simple plastic bags. The clients do not mind the raw presentation, and simply look for good taste.
When her mother got older, Sonxai was asked to stay home and take care of her. The street shop is close to the house and allows her to earn an income while taking care of her mother. Sonxai’s aunt is a bird farmer – that is how the business idea of selling bird eggs came about. After initial success with small amounts of eggs, Sonxai realized that the business had potential. All she needed was a small loan to increase stocks and hence her sales volume. Her profits were too small to apply for a loan from a commercial bank and thus, she took loans from a money lender. At 12% monthly interest much of her profit went into loan repayment. One day she saw a leaflet by EMI (a local microfinance provider) and made an appointment. Her first loan of US$ 250 helped her to scale the business. “Now, I can earn up to US 30$ a day” she says.
Inspired by the success and convenience of Safaricom’s mobile payment service M-PESA, a new company called Mobile Venture Kenya Ltd. recognised an opportunity to test a flexible savings product through mobile channels targeted at the poorest.
The pilot project was called Jipange Kusave (in Swahili “to organize oneself to save). Clients would receive interest free loans for a small administrative fee and all payments would be made directly through M-PESA. A small part of each loan was retained as savings. This setup meant that there were no field collectors, lower costs, but also increased risk of default. Despite the minimization of human interaction, the initial recruitment and registrations were conducted in person. The higher risk required a good screening process to avoid clients with higher likelihood to default.
A recent New York Times feature entitled “China’s Great Uprooting: Moving 250 Million into Cities” discussed China’s ambitious plans of relocating an unprecedented number of its rural population to cities. In the next 15 years the government wants to build hundreds of new cities to accommodate more than 250 million people.
If current trends were to continue China will have:
- 1 Billion urbanites by 2030
- 221 cities with more than 1 Million people by 2025 (Compared 35 in whole of Europe today)
Another report in The Telegraph mentions the Chinese government plans to move 400 million people from rural areas into cities over the next decade. In order for this to happen China is building new cities from scratch. Up until today urbanisation as an instrument of poverty reduction has worked out well for the most populous country in the world. The Telegraph calls it “the greatest social revolution in human history”:
Already China’s Herculean urbanisation drive, unprecedented anywhere on earth, has radically changed this nation of 1.3 billion people and counting. The country’s urban population soared from 170 million in 1978 to around 690 million in 2011. That process has been accompanied by perhaps the greatest social revolution in human history: in the last 30 years over 600 million Chinese have been lifted from poverty.