Dear all,

Last year Ghana abolished its fuel subsidies. There was no available analysis of the reform's impact. UNICEF led high-level advocacy, working with the World Bank, to conduct preliminary analysis of the impact and estimate scenarios for a rapid and substantial expansion of the country's social protection. As a result, the budget to the national cash transfer programme, LEAP, was tripled.

To verify this preliminary analysis UNICEF Ghana and PEP (the Partnership for Economic Policy; www.pep-net.org/) completed a research paper on the impact on poverty of the fuel subsidy reform. We used a partial equilibrium model to look at the direct and indirect effects of the fuel price rises on household welfare: portal.pep-net.org/documents/download/id/22039

We confirm that the vast majority of the fuel subsidies' benefits went to the country's wealthiest group - almost 80% went to the richest quintile of the population, whereas less than 3% of the subsidies actually reached the poorest.

Importantly, the results show that removing fuel subsidies could indeed have increased poverty - by 1.5 percentage points. That's an additional 395,000 people pushed into poverty as a result - and the vast majority of these households have children.

But would increasing social protection really make enough of an impact to 'mitigate' this negative result at the national level? We estimated the effect of scaling-up the LEAP cash transfer programme in response. The paper shows that doubling the programme to 150,000 households in 2014 will in essence completely reverse the national increase in poverty. It also reduces inequality. This year the GoG is now committed to doubling LEAP to 150,000 households.

The experience shows that a combination of fiscal constraint, timeliness, subtle national communication campaigns, thoughtful partnerships, and rapid estimations backed up with rigorous analysis and technical assistance can lead to a peaceful transition away from fuel price subsidies.

In Ghana, although these recent developments will have reduced inequality, the overall longer-term trend is one of rapidly worsening inequality with entire regions left behind. The new household survey this year will provide us with much food for thought.

This is an example of the growing partnership between UNICEF and PEP in locally-led policy analysis using a range of techniques including poverty/deprivation analysis, macro/micro and micro policy simulations, randomized control trials, community-based monitoring systems. An overview of the first phase of this partnership is provided at www.pep-net.org/fileadmin/medias/pdf/publ/Special_Report_on_PEP-UNICEF_collaborations.pdf and some more recent examples can be found at www.pep-net.org/home/page-interne/article/two_new_pep_papers_published_from_unicef_commissioned_studies_in_ghana_and_uganda/ and www.pep-net.org/programs/mpia/special-initiatives/special-initiative-unicef-mena-partnership/

Best regards
John Cockburn
Professeur associé, CIRPÉE, Département d’économique, Université Laval
Pavillon J.-A.-DeSève, 1025 avenue des Sciences-Humaines
Québec (Québec)  G1V 0A6, CANADA
Tél : 1-418-656-2131, poste 2756 ; Téléc. : 1-418-656-7798
Courriel: jcoc@ecn.ulaval.ca
Sites Internet: http://www.ecn.ulaval.ca/john.cockburn     http://www.pep-net.org

New report: State of Power 2014 - Exposing the Davos class

2500 of the most powerful corporate and political leaders are gathering this week in Davos for the annual World Economic Forum. But who makes up this Davos class? And how do they operate? What responsibility do they have or shirk as political and business elites? How can we take back control over our economies, society, environment; indeed our future?

Download State of Power 2014,  TNI's free book and infographics now

Transnational Institute's belief that understanding political power is at the heart of both analysing the problems we face in the world as well as identifying the solutions has led us to produce an annual examination of power.

In our third  ‘State of Power’ report, we go deeper than ever before in exposing and analysing the principal power-brokers that have caused financial, economic, social and ecological crises worldwide. 

The book looks at how power operates in both the EU and in global governance in general; the implications that arise from Snowden's revelations; the role of corporations and the state; and how the Davos class are fuelling land grabs, a new scramble for Africa's resources, and preventing an effective solution to climate change. The book finally shares ideas on how we can reclaim power and build a more sustainable future. 

Combining penetrating essays by leading scholar activists with vibrant infographics that illuminate the machinery of power, this free downloadable book is an essential tool for social movements worldwide.

Contents

• Introduction (Nick Buxton)
• State of Corporations – the rise of illegitimate power and the threat to democracy (Susan George)
• State of Davos – The camel’s nose in the tents of global governance (David Sogge)
• State of Surveillance – The NSA files and the global fightback (Ben Hayes)
• State of Empire: how failed foreign policy, new emerging economies, and peoples’ movements are undermining US power (Phyllis Bennis)
• State of the South – Emerging powers and the potential for progressive change (Achin Vanaik)
• State of the State – The state is dead! Long live the state! (Daniel Chavez)
• State of the Planet – Fateful triangle of big energy, finance and complicit governments (Steve Horn and Peter Rugh, Occupy.com)
• State of Europe: How the European Round Table of Industrialists came to wage class war on Europe (Andrew Gavin Marshall, Occupy.com
• State of Extraction – the new scramble for Africa (David Fig)
• State of the Land - reconfiguration of the power of the state and capital in the global land rush (Saturnino M. Borras Jr.)
• State of Counter Power - How understanding neoliberalism’s 81 cultural underpinnings can equip movements to overthrow it (Hilary Wainwright)

The full report, infographics and chapters can be downloaded at http://www.tni.org/stateofpower2014


Cecilia Olivet
Transnational Institute 

Dear all,

Six years into the global financial crisis, many countries suffer from high and unsustainable sovereign debt burdens. If sustained, debt service will divert scarce public resources from their intended use for social and development spending for decades to come. Failed debt restructurings in Greece and Caribbean countries, and the vulture funds lawsuits against Argentina, also prove that the current (non-)system for sovereign debt workout is in urgent need of reform.

In light of these events, we have seen a surge of political and academic activities on a new sovereign debt workout framework this year, including new processes at the UN and the IMF. We want to give this an extra push in 2014.

A key tool is the "Academics call for a fair and transparent sovereign debt workout mechanism" that was just launched, which will be used in campaigns and advocacy activities as soon as a critical mass of academics has signed.

It would be great if you could join in and sign the call using the following link: http://www.erlassjahr.de/kampagne/academics-call-english.html

Many thanks
Bodo
--

Bodo Ellmers
Senior Policy and Advocacy Officer
Eurodad, European Network on Debt and Development
Tel: + 32 2 894 46 51
Skype: eurodad-bodo
Email: bellmers@eurodad.org
Rue d’Edimbourg, 18-26. Brussels 1050. Belgium

Eurodad's new report on the debt crisis has just been released: "The new debt vulnerabilities. Ten reasons why the debt crisis is not over." Download here