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Poor may be biggest losers

The world's poorest people will be hungrier, sicker and have fewer jobs as a result of the global financial crisis, and cash-strapped aid agencies will be less able to help, aid groups are warning.

The charities that provide food, medicine and other relief on the ground say cutbacks have already started, but it will take months or more before the full impact is felt in the poorest countries of Africa, Latin America and Asia.

Aid agencies face more than just the prospect of plummeting donations. The economic conditions themselves – higher food prices and more joblessness – are greatly increasing the number of people who need assistance.

Philippe Guiton of World Vision told The Associated Press that his agency plans to cut back hiring, which will have implications for delivering aid to the needy overseas.

“What we are going to do now is to issue an order to reduce spending, to delay recruitment, delay purchases of capital assets, etc., until we can see clearer how much our income has dropped,” he said.

Robert Glasser, secretary-general of CARE International, said the agency has “a number of major donors who have invested heavily in the markets and have now seen their portfolios take a big hit.”

What that will mean could take months or more to gauge – and perhaps years for a complete recovery, aid groups say.

In impoverished Haiti, funding for projects to rebuild from tropical storms that killed nearly 800 people and destroyed more than half the nation's agriculture hangs in the balance.

“It's too soon to tell yet because we haven't heard back positively or negatively from our major donors,” Greg Elder, deputy head of programming for U.S-based Catholic Relief Services, said by telephone from the battered southern port of Les Cayes.

During global recessions in the 1970s and 1990s, aid spending dropped sharply and took years to recover, said Matt Grainger of the British-based charity Oxfam International.

That means problems across the board, said CARE's Glasser. Wealthy countries will stop investing in developing countries and cut back on imports from poorer countries, leaving their governments with less money to pay for health care and schools, he said.

In Zimbabwe, a Red Cross food program for 260,000 orphans and HIV-infected people began last month to make sure AIDS victims have sufficient nourishment in a nation where millions are going hungry because of drought and land-seizures that have devastated agriculture.

HIV-infected people are especially vulnerable because without food they cannot tolerate their medicine.

“The farmers' food stores are depleted. There is no food available,” said Peter Lundberg, country representative of the International Federation of Red Cross and Red Crescent Societies.

“I spoke to a family a few days ago and I said, ‘How are you coping?' Basically this was a poor farmer family. And they said, ‘We used to have three, maybe four, meals a day and now we're down to one meal.'”

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