HUMANITARIAN CRISES MONITORING: IMPACT OF THE CORONAVIRUS

Written Evidence Submitted by Mercy Corps to the International Development Committee - Part 1

APRIL 2020

Introduction

1. Mercy Corps is a global organisation working in more than 40 countries around the world responding to conflict, crisis and fragility. From Syria to South Sudan, Iraq, to Columbia we work with some of the 1.5 billion people whose lives are currently riven by conflict and violence, addressing both the devastating impact and the root causes of conflict and fragility.
2. As the COVID-19 pandemic continues to spread around the world, including in the most fragile contexts, it threatens to collapse health systems and economies worldwide. As always, the most devastating effects will be felt by those already most vulnerable - people and communities in fragile or conflict-affected places, with weak health systems, struggling economies, and poor governance. In those contexts, some communities are likely to be disproportionately affected by both the direct and secondary impacts of the COVID-19 crisis, such as refugee and displaced populations and women and girls.
3. This pandemic will create an overwhelming burden on economies, health systems and infrastructure. However, as we have seen in pandemics elsewhere, the impact on inequalities, rights and social structures will also be significant, posing broader challenges to resilience and peace.
4. This submission draws on Mercy Corps’ experience responding to the COVID-19 crisis in 40 countries in Africa, Asia, Latin America and the Middle East, as well as Mercy Corps’ analysis of the direct and secondary impacts of the pandemic in those countries. This written evidence is the first of a two-part submission to the IDC, and focuses on the four aspects indicated below.

The direct and indirect impacts of the outbreak on developing countries, and specific risks and threats

Markets, employment and food security

5. The COVID-19 pandemic is likely to have its most durable impact on the food and economic security of vulnerable groups in the fragile places where Mercy Corps works. For many of these individuals, the threat to their livelihoods will surpass the direct threat of COVID-19. While we still cannot fully grasp the geographic reach and severity of this rapidly evolving crisis, our current analysis and experience from recent outbreaks paints a picture of the actual and likely impacts of the COVID-19 pandemic:
6. As borders close and transport and movement of people and goods are severely restricted, supply chain networks will be heavily disrupted. Due to government restrictions, prices for fuel, food, agricultural inputs, and other key items are already starting to spike in the places where we work.[1]
7. Micro and small businesses will suffer severely from limitations on movement, leading to widespread unemployment. Experience from China, and now the US, confirmed by our analysis during Ebola in Sierra Leone indicates that decreases in sales and customer traffic will be the most significant and difficult to recover from in areas that face lockdown measures for extended periods. The disturbance of supply networks and loss of consumers will lead to the closure of small businesses and high rates of unemployment.
8. Similarly, the financial service sector will face major setbacks as foreign exchange slows, trust in banks erodes, and borrowers are unable to repay their loans. Remittances—key to coping in crises—will dry up. In Yemen, Mercy Corps’ Crisis Analytics team has already flagged the potential negative impact of losing these financial in-flows.[2]
9. The ILO has predicted a loss of 13 million jobs in a moderate scenario.[3] The Middle East expects to lose no less than 1.7 million jobs before the end of 2020.[4] Those who operate in the informal economy, rely on informal credit, and/or depend on fragile markets to meet their needs, including young people and women, will be hardest hit economically.[5]
10. In addition, informal workers (who comprise 40% of Sub-Saharan Africa’s gross GDP according to the IMF) are mostly excluded from economic measures adopted by some governments (such as Ethiopia, Kenya and Tunisia) to limit the economic impact on individuals and companies.[6] Particularly in low- and middle-income countries, hard-hit sectors have a high proportion of workers in informal employment and workers with limited access to health services and social protection. Without appropriate policy measures, workers face a high risk of falling into poverty and will experience greater challenges in regaining their livelihoods during the recovery period.
11. Those economic impacts are and will continue to be felt especially by women and girls who are generally earning less, saving less, and in insecure jobs. In low and lower-middle income countries, a higher proportion of women are in informal employment than men. In Africa for example, 90% of employed women are in informal employment compared to 83% of men.[7]
12. While government measures, and thus the impact on businesses and people, will vary from one country to the next and from one day to the next, we recommend careful analysis, including market analyses, to inform sequencing, layering, and integration of humanitarian assistance with recovery programming, taking a systems and resilience approach, wherever possible.  This will require long term, flexible funding that works across traditional silos (particularly humanitarian and development) and investing in regular analysis of the evolving contexts and broad impacts of such measures to enable responders to adapt to changing needs and constraints.

Social cohesion and peace

13. Mercy Corps’ analysis shows trust is already beginning to erode between populations and states in some places, as protests against the measures adopted to counter the COVID-19 pandemic are rising, and sometimes met with disproportionate force by state security actors. In Sudan, security forces reportedly deployed tear gas on protesters in Khartoum for breaking COVID-19 curfew. In Libya and Tunisia, criticism of government responses to the pandemic seem to be especially heavy. This narrative trend around blame threatens to expose and widen long standing divides within societies, possibly leading to open conflicts. (CA)
14. Tensions are also exacerbated by the fact that the majority of the populations in fragile states do not have the economic resilience to comply with their governments’ disease mitigation measures (including isolation within residences and leave from employment). Grievances linked to feelings of inequality and injustice are therefore increasing and creating tensions among communities as well as between communities and their governments.

15. Terrorist groups may see a window of opportunity to strike while the attention of most governments is turned towards the pandemic. Mercy Corps’ analysis shows high levels of violence in Somalia, Libya and Mozambique. Al-Shabaab has made a number of assassination attempts, and conducted direct attacks on AMISOM and Somalian military convoys and bases. In Mozambique, a two year old disputed insurgency in northern Mozambique emerged on March 23 as a fully-fledged Islamic State (ISIS) operation, occupying two key towns in three days as Maputo was distracted by COVID-19. Our analysis also shows that the Libyan civil war intensified in the final week of March.[8]
16. As the COVID-19 pandemic deepens economic and social stress coupled with restricted movement and social isolation measures, gender-based violence is increasing exponentially. Many women are being forced to ‘lockdown’ at home with their abusers at the same time that services to support survivors are being disrupted or made inaccessible.
17. In this context, efforts must be made to maintain and strengthen social cohesion and peace, preventing social tensions between individuals and communities experiencing a sense of inequality and injustice, including refugees and displaced populations and their host communities, as well as women, youths, minority groups, and informal workers. The response therefore needs to address root causes of violent conflict such as potential grievances, discrimination and stigmatisation over access to resources, livelihoods and health services, as well as invest in positive efforts to build social cohesion and manage potential conflict.

Compounded Disaster and Climate Change

18. Both monsoon and hurricane seasons begin in June.  This year’s hurricane season is expected to be particularly damaging, with 8, instead of the normal 2-3 hurricanes, predicted.

19. Extreme weather events, including storms and flooding, will push communities to higher ground and to congregate in crowded shelters that will likely include COVID positive patients.
20. Planning immediately for the upcoming hurricane and monsoon season is critical to avoid a ‘compounded’ disaster.  This can include ensuring evacuation and emergency shelter plans.  Utilize existing DRR resources and thinking, for example, adapting early warning systems and community DRR committees to include public health outbreak measures will enable frontline workers and governments to more effectively manage COVID-19 and not duplicate efforts, saving time, resources and lives.

Vulnerable populations

21. Refugees and displaced populations, and especially women and girls – many sheltering in slums or relying on overstretched host communities, others in overcrowded camps – are particularly vulnerable to the impact of the pandemic. They faced many barriers to access to healthcare services and decent work opportunities already before the crisis, which are likely to be aggravated.
22. In some places, we are already seeing COVID-19 movement restriction measures having an impact on migrants’ livelihoods. On the route from Libya to Europe, we have received reports of migrants having to sell their phones (a key asset) in order to be able to meet their basic needs.[9]
23. In addition, we know from experience that migrants and other displaced populations are more likely to be stigmatised or facing violence if they are known to be carrying the disease.
24. Efforts must be made to ensure that the response leaves no one behind and vulnerable groups such as refugees and displaced populations or women and girls are integrated in any response plans. Especially, access to reliable and trustworthy information will be key to help those populations cope and recover from the crisis.

Lessons identified and learned/applied from previous experience with infectious diseases (for example, Ebola); the implications for DFID’s policy on a global health strategy

25. From responding to Ebola and tuberculosis in West Africa, the DRC and Pakistan, we have learned a few key lessons:
26. Community engagement and mobilisation must be a central, cross-cutting element of the COVID-19 response. Community mobilization was especially important in stopping the Ebola outbreak in the Eastern DRC, due to the role of rumours and mistrust in driving community resistance to the response.[10] Similarly, engaging communities to educate and protect themselves, prioritizing science-based messages, in local languages, using approaches that reach far and wide within the countries affected by COVID-19 will be key to a successful response to this pandemic.
27. Combating disinformation and mobilizing public and social media to provide localized critical health information is also essential in a pandemic response. We saw in the Ebola response, how fake news and weaponized social media campaigns can undermine crucial health responses and put people at more risk. This may include anti-western and anti-INGO narratives, as well as stigma and incitement against those thought to carry the virus.[11]
28. In fragile places where tensions or violent conflict already exist, rumours and mistrust will likely play (or are already playing) an important role in driving community resistance to a COVID-19 response and potentially lead to violence. In 2019, the World Health Organization documented an estimated 390 attacks on health facilities in the DRC, killing 11 health workers and injuring 83 healthcare workers and patients. A third of these incidents were acts of resistance to the Ebola response. There were persistent reports of individuals refusing the vaccine and avoiding treatment centres, violent attacks on Ebola treatment centres and hand washing stations. As a result, efforts to slow the spread of new infections were seriously hampered. Fostering community ownership of the COVID-19 response in a conflict-affected or fragile political context in particular will require the commitment of substantial personnel and resources that allow for ongoing learning and adaptation to local perceptions and politics.
29. Based on our experience in the Ebola outbreak, this pandemic will have a specific impact on women and girls. We learned during the 2013-2016 Ebola outbreak in West Africa that the economic impacts of the outbreak and the corresponding public health response placed women and children at greater risk of exploitation and sexual violence in the community and in the home. Past epidemics, including Ebola and Zika, illustrated that the efforts to contain outbreaks often divert resources from routine health services including pre and post-natal health care and contraceptives, and exacerbate limited access to sexual and reproductive health.
30. Mercy Corps’ research during the West Africa Ebola Crisis showed that responses to outbreaks must seek to save livelihoods as well as lives. During the 2014-2016 West Africa epidemic, Mercy Corps conducted two market studies, one on the impact of Ebola on markets in Liberia and a Sierra Leone economic recovery assessment. This research demonstrated that efforts to control Ebola can have severe, unintended consequences on already struggling local economies. In Liberia, Mercy Corps’ assessment of economic impacts on households, traders, and a range of other market actors found that border closures, market closures and restrictions on movement had significant negative effects on local business and food security with 66 percent of households reporting a loss in income. In Sierra Leone, results from Mercy Corps’ assessment highlighted that negative economic impacts of the crisis were significantly larger in local areas that had heavy restrictions on movement. The economic impact of restrictions was significant, with the greatest consequences on marginalized groups and the smaller, more informal businesses.

The UK’s response, bilaterally and with the international community, to the spread of coronavirus to developing countries

31. On 12 April 2020, the UK has announced a package of £200 million in aid to help address the spread of COVID-19 in developing countries. Of this package, £130 million will go to the new UN appeal, including £65 million for the WHO, £20 million for UNICEF, £20 million for the UNHCR, £15 million for the World Food Programme, and £10 million for the UN Population Fund (UNFPA). Another £50 million will be allocated to the new International Red Cross and Red Crescent Movement appeals, and £20 million will be for international NGOs, including UK charities.
32. We welcome the UK’s commitment to supporting its partner countries around the world through a generous package. However, we are deeply concerned that only 10% of this package and 5% of the UN Appeal is directed to frontline NGOs, who are already positioned to adapt and scale up COVID-19 responses and are those most able to deliver rapidly in this crisis. 
33. In truth much of the funding passing to UN agencies or pooled funds will eventually be delivered by NGOs (both International and local partners), but passing it via these mechanisms will mean significant time lag before implementation can begin.  If this is done in the usual way, we will also see that such grants will not include the support to core and staffing costs, flexibility or other beneficial terms that are offered to the UN as the original funding recipient.  Given the enormous complexity of operating with the current restrictions and challenges, this will create an untenable burden on many NGO delivery partners - historically there are many examples of NGOs underwriting the core running costs of UN grants with UN grants not covering the full ‘costs’ of implementation for each grant.  We are asking that DFID work with UN agencies and pooled funds to expedite procedures to minimise the delay in funding reaching delivery partners, and to pass through the same level of flexibility key donors are providing the UN. 
34. We have seen in the past how the UK can take up a leadership role in ensuring that the international community coordinates its efforts to respond to a crisis and would hope to see the UK urgently take up a similar role in the COVID-19 crisis. A coordinated response and clear information-sharing among NGOs, UN agencies and government institutions is essential in any response, but particularly so in a pandemic, where a fast and effective response is necessary to stop transmission. As a major contributor to the international aid system, we believe that the UK is in a position to lead by example by promoting impeccable coordination and information-sharing among other donors and partners.
35. DFID’s communication with partners, especially INGOs, has been lacking consistency and structure in this crisis. As first responders, INGOs have the expertise and field-driven analysis necessary to inform DFID’s response to COVID-19 in developing countries, as well as experience and expertise in how to deliver a response in even the most challenging environments, including through remote management. DFID should start engaging with the NGO sector in a structured way, including by establishing a COVID-19 Task Force including UK government, NGOs and other experts. 

The impact of the outbreak, and consequential mitigation measures, on fund-raising by UK-based development charities/NGOs

36. In many places where Mercy Corps works, there will be a period during which time we are not able to continue programmes or achieve grant objectives, yet we must continue to pay our staff (or lay them off). Some donors (USAID) have indicated that frontline salaries in such circumstances remain eligible, but others (including DFID) have yet to do so.
37. A significant proportion of our core costs (including HR, security, governance, analysis, technical advice) is funded through a ‘cost recovery’ system - a percentage of grants spent.  While programmes are suspended due to COVID-19 related restrictions adopted in the countries where we work, this income will be greatly reduced, at the same time as income from other fundraising is also likely to shrink significantly. This is at a time when such core functions are absolutely critical to ensuring we can safely and effectively respond to COVID-19.
38. Although there are indications that DFID will be flexible and supportive of suppliers including grantees (and sub grantees), we are urgently seeking more specific guarantees and centralised commitments in order to ensure that we can maintain our operations and continue to respond to COVID-19 and other crises around the world.
39. At the same time, the longer term funding landscape for INGOs is cause for concern. With a projected decrease in ODA of 13% GDP (£2bllion), and current resources being stretched and diverted towards responding to the COVID-19 crisis, there will be limited resources for NGOs and others seeking to respond. That means it is absolutely essential that UK ODA is dispersed in the most effective and efficient way possible, through effective, cost effective and impactful delivery organisations, and minimising the costs and delays previously associated with, for example, passing funding through multilateral organisations.