Can the COVID-19 pandemic help us prepare to respond to climate-related crises? Yes, it does. Crises often offer lessons for the future. While COVID-19 had enormous negative repercussions in many ways, it also left us good learnings, in this case, lessons that will be useful to prepare us to respond to shocks caused by climate change.
We know that our region is one of the most exposed and vulnerable to the risks of climate change, which, in turn, generates significant economic and social impacts. Last year alone, landslides and floods caused by heavy rains resulted in dozens of deaths in Quito, Ecuador, and Recife, Brazil. An unprecedented heat wave hit the Southern Cone in January 2022. Hurricane Julia hit Central America in October of the same year, leaving significant human and monetary losses. In 2021, the intense drought in the southern Amazon and Pantanal was the worst in 60 years. Widespread drought across the region has significantly affected inland waterways, crop yields, and food production, worsening food insecurity in many areas.
Although some countries are already making progress in reducing their carbon emissions and preparing their adaptation and resilience plans, the effects of climate change will continue, meaning that the region still has a lot of work to do. So how can we meet the challenges ahead? And in particular, how can we contribute to reducing these impacts among the poorest and most vulnerable?
Responding to climate change will require essential economic transformations to benefit the region. Still, it will require more robust risk management systems, including social protection. Although current social protection systems are relatively advanced, they still need to consider the impacts related to climate change. For this reason, in order to boost the region’s response capacity, the IDB is launching its latest study, where we analyze how LAC countries used non-contributory social protection to respond to COVID-19 and how learning from this crisis can help us respond to climate-related shocks.
A before and after
The COVID-19 crisis changed the rules of the game of shock-responsive social protection in LAC. As a result, all countries had to implement at least one social protection measure during 2020. In addition, these changes brought new mechanisms to prepare for challenges such as those related to climate events.
Before COVID-19, social protection systems in LAC did not have standardized strategies to respond to shocks of different natures. Governments tended to play a reactive role in crises, including those generated by environmental impacts, with ad-hoc responses to specific emergencies. For example, in addition to the reconstruction of infrastructure after a hurricane or the provision of materials to alleviate the effects of floods, the typical response to disasters consisted of humanitarian assistance with the distribution of in-kind assistance, such as food delivery. The humanitarian responses were not aligned with the social protection response, and with COVID-19, this changed.
The social protection response to COVID-19 led to new temporary programs to reach populations affected by the crisis but not typically beneficiaries of cash transfer programs. These new programs had an important impact on mitigating the effects of the pandemic on poverty and food insecurity. Given how the pandemic evolved, governments changed the approaches used to identify and register beneficiaries, innovatively adding new information to existing social registries from mass registries with electronic forms. In Peru, for example, although they already had high coverage in the social registry, they developed a new registration mechanism to expand coverage virtually. They also innovated significantly in how transfers were done, introducing different electronic payment mechanisms, which helped to provide faster response, though with the risk of leaving behind people who do not have access to the financial system or connectivity. Although virtual payment was a great challenge in Bolivia, through these changes, they managed to significantly increase the use of digital banking systems, achieving greater coverage.
Lessons for the future
Three main insights emerge from the LAC shock response experience during COVID-19 that are relevant for managing climate-related shocks in the future:
1. It is possible to scale up non-contributory social protection interventions to augment shock response as part of strategies to manage complex crises. Large-scale social protection interventions that successfully respond to shocks are feasible and should be incorporated as an additional layer within a comprehensive risk management system. In the case of shock responses to climate change-generated impacts, it will require emergency responses, humanitarian action, and health and infrastructure interventions, among others. For example, in Honduras, after the onset of the pandemic, two intense hurricanes hit the country. The government was already adapting a G2P tool to address the health crisis, and after the hurricanes, they were able to use this same mechanism to respond to the impacts of both cyclones.
2. The type and nature of the crisis are vital to creating imperative responses. Crises generated by climate impacts tend to be localized, so the social protection response may require greater public and political support than COVID-19. This is evidenced by the limited use of social protection to respond to climate crises in the past. And, in the case of responding, in the preference for expanding benefits to existing beneficiaries, as Peru did in 2017 with El Niño Costero and El Salvador did in 2018 in the face of drought, rather than expanding coverage temporarily.
3. Increasing social protection coverage could reduce future needs to respond to climate-related shocks. Due to low pre-pandemic coverage and the high level of labor informality in the region, all countries found it necessary to provide large-scale responses when the pandemic hit. Ensuring a social protection floor can help reduce the need for large-scale responses in the future and contribute to increasing the resilience of poor and vulnerable households to climate change.
Recommendations for designing systems and interventions to respond effectively to climate shocks
The study also provides some key lessons and recommendations for social protection systems in the region:
– Focus on designing shock-responsive social protection systems, not programs.
– Understand and assess climate risks in advance to design appropriate social protection responses.
– Prepare in advance targeting and beneficiary selection mechanisms and systems to be responsive to shocks.
– Consolidate and improve the shock-responsive information and payment systems that were put in place during the pandemic
– Invest in improving institutional, contextual, and financial factors by ensuring interagency collaboration, political support, and contingent funding.
Want to learn more about the study, recommendations, and lessons learned? Download it here.
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