Confronting Rising Inequalities in Asia and the Pacific

Your Excellency, Mr. Vichien Chavalit,
Acting Minister of Social Development and Human Security,
Royal Thai Government

Distinguished Delegates,
Ladies and gentlemen,

Introduction

It is my pleasure to welcome you to the third session of the Committee on Social Development. We are gathered to deliberate on the critical subject of inequalities. Political and social tensions, arising from growing inequalities in different parts of the world, have stimulated widespread debate about the causes and consequences of inequality, as well as how best to address these problems.

Inequality also features as one of the central issues in deliberations about the post-2015 development agenda, and Member States have proposed a specific sustainable development goal (SDG) to reduce inequalities within and among countries, along with other targets such as enhanced access to decent jobs and other basic services, all of which aim to reduce levels of disparity.

Over the next three days, in this context, our objective will be to deliberate on the Asia-Pacific region’s social development priorities, and how to better integrate social issues with the economic and environmental pillars of sustainable development over the next biennium.

Why Inequalities Matter

Why are we all so concerned about rising inequalities in Asia and the Pacific?

First, despite Asia-Pacific’s unprecedented growth, one out of every three people – about 1.64 billion in our region – are still living on less than US$2 per day. Among these, 950 million are trapped in extreme poverty (living on less than US$1.25 per day), deprived of basic rights, and highly vulnerable to economic and environmental risks.

Second, had income inequality not increased in three of Asia-Pacific’s largest economies in 2008, an additional 189 million people would have been lifted out of poverty.

Third, highly unequal societies limit the productive capacity of nations and repress domestic demand for the basic goods and services that serves as an impetus for economic growth.

Fourth, high levels of inequality present significant threats to social cohesion, political stability and environmental sustainability by creating a divided society between ‘those that have and have not.’

Inequality comes in many forms: in income and wealth, in well-being and in power and voice. Inequalities in access to power and opportunities reinforce inequalities in outcomes. These inequalities are also evident between key population groups, including between women and men, persons with disabilities, youth, migrants and older persons.

Let me give you some examples:

Inequalities in Income and Wealth

Recent data for 31 countries in the Asia-Pacific region indicate that income inequality rose in 18 of these countries between 1990 and 2012. On average, the richest 10 per cent now has twice as much income as the poorest 40 per cent. The rich are getting richer, at the expense of the poor, as income from capital grows faster than income from labour.

On the positive side, several countries in the region are taking measures to address widening income gaps by introducing cash transfers for the poor and other vulnerable groups. China, for example, provides means-tested cash transfers to those with an income under the established minimal standard of living. Similarly, India guarantees 100 days of wage employment per year to any rural adult household member willing to participate in unskilled manual work.

Inequalities in Well-Being

Lack of access to education accentuates inequalities. Despite the remarkable progress achieved in improving access to education, 18 million children of primary school age are not attending school in our region.

Disparities in tertiary education are prominent between countries in Asia and the Pacific. While the average enrolment rate in high-income countries is around 70 per cent, it is below 20 per cent for many least developed countries.

Within a country, family income tends to be a strong determinant of the number of years a child attends school. In many countries, the number of years in school of a child from a family in the highest income quintile is twice the number of years in school of a child from a family in the lowest income quintile.

Poor access to health-care services, another key determinant of well-being, exacerbates inequality. In several countries in the region, more than half the total health expenditure originates from private households. In, for example, Afghanistan, Azerbaijan and Myanmar, private households carry the burden of more than two thirds of total health expenditure, making health care almost impossible to afford for many people.

In several countries, income seems to be a strong factor determining access to reproductive health services. For instance, in Bangladesh, less than 5 per cent of births in the lowest income quintile were attended by skilled personnel, compared with 51 per cent in the highest quintile. In other countries, such as the Philippines and Turkey, the lack of attendance of skilled personnel at births seems to prevail only in the lowest income quintile.

In an attempt to reduce these inequalities, several countries in the region, including China, the Islamic Republic of Iran, the Republic of Korea, Solomon Islands and Thailand, have introduced universal access to health-care services. Bhutan and Cambodia are exploring a range of innovative financing solutions to enable the same provision.

Gender Inequality

Of particular prominence and universality are inequalities between women and men, and between girls and boys in our region. As an example, in 16 Asia-Pacific countries, women hold less than 10 per cent of seats in national parliament. This obviously limits their voice and power.

Gender inequality is a distinct, pervasive and cross-cutting barrier to equitable, inclusive and sustainable development in Asia and the Pacific. Gender-specific obstacles disproportionately limit access to education, healthcare, financial markets, and productive employment opportunities for women and girls. In combination with the lack of child and elderly care services, women are often pushed into insecure jobs in the informal sector which in turn cement the gender wage gap.

Effective Policy Responses to the Challenge of Rising Inequalities

Notwithstanding the breadth and scale of the challenge, the obstacles that inequalities present to our shared goal of equitable and inclusive sustainable development can be addressed. Social inclusion and combatting growing gaps within our societies require strategic and gender-responsive investments.

  • First, enhancing social protection and ensuring universal access to quality essential services helps alleviate the symptoms of poverty and inequality and their underlying structural causes. Recent data indicate that only 30 per cent of persons above the retirement age receive an old-age pension, only 10 per cent of the unemployed receive any out-of-job benefits and less than 30 per cent of all persons with disabilities have enough income for self-support. In other words, there is great scope for improvement.
  • Second, productive and decent work can be promoted through conducive macroeconomic policies, coupled with stricter implementation of labour laws and regulations. Such an approach would ensure that economic growth generates more and better jobs for the region’s population working in vulnerable jobs, while avoiding a “race to the bottom”, triggered by international competition.
  • Third, we need to strengthen redistributive taxation systems. By doing so, governments would not only be able reduce the inequality gap between the rich and the poor, but also expand their fiscal space for financing social protection, while strengthening solidarity across a range of socioeconomic groups and generations. Evidence indicates that, in several countries of the region, there is great potential to do this.

These policy measures benefit all stakeholders, from individuals and communities to public and private institutions. Moving them forward is, therefore, a shared challenge that must inspire new partnerships and creative approaches as we develop a regional and global vision for the future beyond 2015.

Conclusion

In conclusion, the current session of the Committee on Social Development provides an opportunity for you, our member States, to deliberate on the priority issue of rising inequalities in Asia and the Pacific and the potential for enhanced regional cooperation. The session also enables the secretariat to seek direction from you on the proposed programme of work in social development for the forthcoming 2016-2017 biennium.

Over the next three days, we look forward to the following outcomes:

  • Prioritization and guidance on addressing inequalities in Asia and the Pacific, and identification of areas that would benefit from enhanced regional cooperation;
  • Endorsement of the Asia-Pacific roadmap for review of 20 years of implementation of the Beijing Declaration and Platform for Action;
  • Review of the framework and elements of the draft outcome document of the “Asian and Pacific Conference on Gender Equality and Women’s Empowerment: Beijing +20 Review”; and
  • Endorsement of the secretariat’s programme of work in social development for the 2016-2017 biennium.

In addition to reviewing overall priorities and proposed actions for social development, this Committee session assumes great significance as it will serve as the preparatory body for the “Asian and Pacific Conference on Gender Equality and Women’s Empowerment: Beijing +20 Review”, to be convened by ESCAP in cooperation with UN Women in November this year.

The outcome of your work will contribute to the development of the regional and global agenda for gender equality and women’s empowerment that will drive our collective efforts over the next decade.

Our discussions could not be timelier, and I wish you every success in your deliberations.

I thank you.