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COVID-19 in Low- and Middle-Income Countries: What does the future hold?

Oct. 5, 2020 | Lindsay Morgan interviews Kelsey Jack

kelsey-jack.pngIn this interview, Kelsey Jack, an associate professor in the Bren School of Environmental Science and Management at the University of California, Santa Barbara; and director of the Poverty Alleviation Group at the Environmental Market Solutions Lab (emLab), discusses the impact of COVID-19 on low- and middle-income countries; why the pandemic may undermine support for climate change efforts; and what are the prospects for cooperation among global development institutions.

What toll will the spread of COVID-19 have on global development—people, systems, economies?

The toll of COVID-19 on global development is extremely heterogeneous—some countries are being hit extremely hard by a combination of high virus transmission rates and/or very aggressive policy responses.

There was a fair amount early in the pandemic of what looked like copycat responses, where countries were looking to how Europe, and to a lesser degree the United States, was responding and were adopting some of the same restrictions on mobility and economic activity, even before LMICs started to see virus counts increase. That was a very understandable reaction; but the restrictions on mobility, for example, led to massive numbers of migrants being stuck and needing to find alternative ways to get home, often in violation of laws. It led to excuses for police brutality related to enforcing stay at home orders. There were news stories about that happening in South Africa, in Brazil, and in India.

The biggest toll of COVID-19 is going to be on the poor, unsurprisingly. It will likely be the result of some combination of mis-matched policy restrictions, combined with the macroeconomic flows that in turn affect commodity prices, trade flows, and access to markets.

Experts and practitioners have long discussed the waning influence of the U.S. in the development space. Has the U.S. response to COVID-19 done further damage to our ability to play a positive role in global development?

It almost certainly has, for at least two reasons. One is, even as countries around the world are starting to ease travel restrictions, the U.S. is still on the red list for many countries. As it becomes easier for, say, Germany to begin to engage again with a given country, the U.S. is considerably further behind. These physical limitations will likely have lasting ramifications. Countries able to step in quickly and collaborate constructively to support recovery are going to be building relationships that will likely be persistent.

Second, the way the U.S. has dealt with the pandemic, and the likely lasting impacts on our economy, has the potential to upset the entire world order. The United States’ position as the globally dominant country was already precarious. This may be the thing that topples it. If we are recovering from this onslaught for a very long time, it will be hard to get the general public on board with having resources go overseas. That’s always been a struggle in this country, even in times of surplus. The combination of a very serious and long-lasting recession in this country, and the potential struggle to maintain a global position, is probably going to distract pretty heavily from any serious positive influence on global development on the part of the U.S.

What are the biggest challenges that COVID-19 presents to global development, and specifically to your area of expertise: the environment?

There are many unfortunate things about COVID-19, and one of them was that it undermined some of the momentum that was starting to build around climate change. It did so in a few ways. One was, in the midst of the most serious phase of lockdown, there were stories in the media celebrating how much CO2 emissions had fallen, and how foxes were retaking the Montreal waterfront. That was really misguided. The 17% reduction in CO2 emissions in April could be interpreted very differently, as: we basically shut down everything for a couple of months, and we only got a 17% reduction?”—and at an astonishing cost? The economic shutdown was so astronomically large, and the reduction in CO2 emissions so far from what is needed, that it should be a terrifying statistic, not an exciting one, if you care about the environment. 

The other issue is, it’s one thing to think about environmental investments when you have resources to invest. When you have no resources to invest, it’s a lot harder. Anything that’s viewed as a threat to jobs is suddenly going to be untouchable. Anything that’s seen as a threat to the higher cost input for industry is going to be untouchable. Yet these are the things that are crucial for transforming to a cleaner set of economic activities. The economic costs of this pandemic are going to be long lasting, which is going to make it very hard to get back to the point of a serious conversation about tackling climate change.

There is a conversation happening right now that suggests that policy responses and cooperation around COVID-19 can inform thinking and action on climate change. Do you agree?

I think that’s a very interesting conversation, and yes, there are probably some things to learn. But there are some things that are not particularly generalizable or suggest challenges. One is, as a private actor, the benefit to me of going outside without a mask is potentially large, and the cost to me are quite small. The private cost/benefit tradeoff with climate change is very different. For me to take public transportation instead of driving my car is quite inconvenient, and I get effectively none of the gain. Whereas with COVID-19, maybe the costs are still quite high in some cases, like staying home from work, but I recoup a lot more of the benefits, because the virus is a local externality. It’s increasing transmission in my immediate vicinity. Whereas carbon is a global public good, distributed around the world.

The fact that it’s been so hard and so costly to do preventative policy in the case of COVID-19, where the behavior change is relatively easy to justify to the individual, highlights the challenge of climate. That said, it’s not above our capabilities to do preventative policy, which is a good thing.

How do you think global development institutions should respond to help lower income countries weather this—and how do you actually think they’ll respond?

That’s a really good question. I think there are three things that are really important in terms of development cooperation and global institutions.

One is, things are so globalized at this point in terms of economies. Even in rural Zambia where I’m working, farmers are selling commodities priced ultimately by the global market. When the global economy falls, even the most rural farmer in Zambia is affected by it. What that means is that it’s important for the global economy to grow and for it to recover for everybody.

Second, we are all so interdependent; if major global players continue to suffer, it’s going to have implications for everybody. Aid flows and development assistance and development cooperation, done and coordinated in an efficient way, is going to be really crucial. Getting that to the places where it’s most needed is crucial. A dollar in the hand of developing country communities is more useful than a dollar in the hands of a richer community and a richer country. That is particularly true right now.

The third thing is, there has been a knee-jerk reaction by donors to redirect a lot of investment toward COVID. That is short sighted. Now more than ever, continuing to invest in the recovery of institutions and investments we know have long-run payoffs—like basic health care, education—is essential. How do we get kids back in school as soon as possible? How do we make sure that women are not afraid to come to the clinic to give birth because of COVID? This is where the real risks arise—if those types of things stop working in developing countries, not if personal protective equipment is in the village. If I were a social planner, I would encourage development cooperation to keep priorities set on the big, fundamental development investments.

Will COVID-19 facilitate cooperation or make it even harder than it already is?

We’ve already seen it hindering it hugely. The British who have been an amazing source of support both directly and indirectly to global development have now embedded DFID with their foreign office, which is leading to an enormous contraction around the world. That is one very salient instance of this, but that’s going to be happening all over the place.