Norwegian Refugee Council

International Development Committee inquiry

Coronavirus in developing countries: secondary impacts - written evidence

27 October 2020

1. Introduction

1.1. The Norwegian Refugee Council (NRC) is an independent humanitarian organisation helping people forced to flee violence and disasters. We work in crises in more than 30 countries. NRC made a submission to the first part of the Committee’s inquiry on 17 April 2020 focusing on the initial impacts of the pandemic on countries with existing humanitarian crises and/or substantial populations of refugees or internally displaced persons. This submission builds on the first and focuses on the inquiry’s second topic: “Economy and food security; economic performance, development and level of ODA (implications for livelihoods and food security and nutrition).” 

1.2. The latest research by NRC, including a survey of 1,400 people in eight countries and more detailed assessments in a total of 14 countries,[i] shows that the economic impact of the Covid-19 pandemic is having an increasingly devastating effect on communities affected by conflict and displacement. Notably, these economic impacts are making it even harder for them to feed their families, keep a roof over their heads, and send their children to school.

2. Loss of income

2.1. Displaced and conflict-affected communities have suffered widespread loss of income since the pandemic started. In NRC’s survey 77 per cent responded that that they had lost a job or income from work, temporarily or permanently, since March 2020. 

2.2. These overall findings of a dramatic drop in the income of crisis-affected people is validated by other assessments across NRC’s countries of operation. For example, in Yemen, an NRC assessment found that 47 per cent of all respondents saw their income drop by half or more during the pandemic, 24 per cent saw their incomes stop completely.

2.3. The pandemic has also impacted other sources of income. 62 per cent of respondents who had previously received remittances from family members abroad said they were receiving less than before the pandemic.

2. 4 As a result of falling income, 30 per cent said that they had to borrow more money now than before the pandemic.

2.5. The economic impact is not uniform within or across countries and has ebbed and flowed as public health measures, the particularities of each country’s economy[ii] and government policies affect access to labour markets. However, while not uniform, the impact on already vulnerable people is almost universally negative.

3. Food security and access to basic services

3.1. The loss of income, coupled with limited access to social safety nets, a drop in remittances and increased debt, is having profound combined knock-on effects on displacement-affected people.

3.2. The economic impact overlaps with existing causes of food insecurity, leading enormous numbers of people to become so food insecure that they will require humanitarian assistance.[iii] NRC’s multi-country survey found that 73 per cent of respondents have cut the number of meals for their household since the pandemic started.

3.3. In sum, the economic impact is exacerbating existing fragility. Countries that have faced decades of conflict such as Afghanistan, Somalia and DR Congo, were already facing huge economic difficulties. Refugees and internally displaced people (IDPs) are uniquely vulnerable and were already facing multiple crises. They have been forced to flee their homes, have limited access to work and education opportunities, often the result of insecure legal status, and in some cases they are faced with continuing violence, or other hazards that threaten their subsistence, such as locusts damaging crops in east Africa.

4. Responding to the pandemic

4.1. The UK, international financial institutions (IFIs) and other donors have taken important action to respond to the Covid-19 pandemic. But the scaled-up support has not been nearly enough.

4.2. The UN’s 2020 humanitarian appeals are only 36 per cent funded as of late October 2020. In addition, initial donor commitments prioritised health responses over programmes that address the economic impact of Covid-19. The specific humanitarian sectors relevant to the economic security are severely under-funded – agriculture at 15 per cent, and ‘housing, land and property’ at 0 per cent, ‘early recovery’ 18 per cent and ‘food security’ 37 per cent.[iv] The UK government should use its influence at the G20 to ensure it commits to fully-fund the UN’s appeals for both 2020 and 2021 at the meeting of its leaders in November 2020.

4.3. In addition, funds have so far been slow to reach people in need. In NRC’s survey, 28 per cent said that they had received less humanitarian assistance compared to before the pandemic. One cause was the impact of public health restrictions on aid agencies’ ability to operate, including restrictions on the movement of staff and goods. Another was the decision by the UK and other donors to overwhelmingly channel aid via UN agencies, which resulted in delays to funds reaching front-line NGOs, despite Grand Bargain commitments to support local and nationally-led responses.[v]

4.4. NRC and other aid organisations maintain that early interventions save more lives and are a more efficient use of resources.[vi] This is urgent as developed countries also face significant levels of domestic economic decline. Even the most generous donors, such as the UK, that commit 0.7 per cent of Gross National Income to overseas development assistance (ODA) are seeing a significant drop in real funding, reducing available resources and impacting on humanitarian action as budgets are re-adjusted.

4.5. However, even a fully funded humanitarian response plan will not address a crisis of this scale for the world’s most vulnerable. The World Bank has recognised that “financial support from IFIs alone will not suffice” and called for “much more broad-based international action.”[vii]

4.6. Quick, decisive and sustained action, including by the G20 now and throughout the UK’s 2021 Presidency of the G7, is required to stem the growing catastrophe that crisis-affected communities are facing. The UK government, working with its G20 partners including IFIs such as the World Bank, should commit to ensuring a dramatic scale-up and rapid disbursement of assistance, as well as a comprehensive plan for debt relief to countries with large numbers of internally displaced and refugees.

4.7. The UK government should also consider committing to an exceptional, time-limited increase of its ODA to retain real funding levels of 2019 to address the unprecedented humanitarian impacts of the pandemic. This would represent an opportunity for the UK to show real global leadership and will, one which prioritises the lives and livelihoods of world’s conflict-affected people in responses to these acute economic challenges.

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