Asia counts social cost of economic crisis

Asia counts social cost of economic crisis

BANGKOK (Reuters): Officials from Asian countries and
multilateral agencies have concluded that Asia's 18-month
economic crisis had taken heavy social and human tolls in the
area.

Participants at a two-day World Bank regional seminar said on
Thursday economic turmoil had sharply aggravated unemployment,
educational and poverty problems in the hardest hit countries
Indonesia, Thailand and South Korea.

The seminar was entitled "Human Dimensions of the Asian
Economic Crisis: The Link between Macro Policy and Social
Consequences,"

World Bank vice president Jean-Michel Severino told the
meeting that developments like Brazil's recent currency problems
posed a threat to recovery efforts being made by Asian countries
suffering their worst recessions since World War Two.

"Financial stabilization has occurred progressively since last
fall. But it is very fragile as the events in Brazil remind
us...(if) the financial situation unravels again, we can expect
further deterioration of the social situation and unemployment
will probably increase," he said.

The International Monetary Fund estimated in a discussion
paper that due to the Asian crisis, unemployment in Indonesia
soared to about 15 percent in 1998 from 5.4 percent a year
earlier.

Thailand also saw its unemployment rate rising to about 6.0
percent from 4.0 percent and South Korean joblessness rose to 7.0
percent from 2.7 percent in the same period.

The IMF said higher unemployment would raise the number of
poor in Indonesia, the worst hit nation of the Asian contagion,
by up to 12.3 million persons or six percent of its population.

Herman Haeruman, deputy chairman of Indonesia's National
Development Planning Agency, said in his paper that unemployed
Indonesians currently totaled 15-20 million.

Indonesians falling below the poverty line had jumped to at
least 80 million or over 40 percent of national population.

The United Nations Population Fund said in another paper that
the crisis forced the Thai government to cut its AIDS control
budget by 24.7 percent in 1998 compared with a 5.5 percent
reduction for other state expenditure.

It said: "In Indonesia, women who lost jobs in factories and
who turned to commercial sex reported that their earnings as sex
workers were lower than they had been as factory workers because
their clients could not afford to pay much for their services."

The International Confederation of Free Trade Unions in a
separate document criticized the IMF and the World Bank for not
providing adequate attention to social and human problems brought
by their reform programs for the region.

"The crisis has demonstrated the danger of ignoring the social
dimension of globalization. Financial and social stability are
closely inter-linked. Stabilization policies that lead to social
explosions will fail and further undermine the credibility of the
IMF and World Bank," it said.