ILO said greater funding is needed for universal social protection

Apr 29, 2024 | International | 0 comments

Addressing reporters in New York, Umberto Cattaneo, the Public Finance Economist at the International Labour Organization (ILO), highlighted the substantial financing gap hindering the achievement of universal protection, particularly in low-income countries.

Cattaneo emphasized, “When we look at all low- and middle-income countries, we have a financing gap of 3.3 percent of GDP. But when we go to low-income countries, this goes up to 52.3 percent of their GDP.” He emphasized the need for an additional US$1.4 trillion to bridge this gap across all low- and middle-income countries.

Analyzing regional disparities, Africa faces the greatest challenge, with a financing gap of 17.6 percent of regional GDP annually. Low—and middle-income countries follow this in the Arab states with an 11.4 percent gap and Latin America and the Caribbean with a 2.7 percent gap.

To close this gap, Cattaneo stressed the necessity of domestic resource mobilization, including progressive taxation and social security contributions. He advocated for tripling development assistance for low-income countries, with the entirety of the additional funding directed towards social protection.

Universal social protection is vital in achieving the United Nations Sustainable Development Goals’ first target focused on poverty reduction. Despite this importance, current ILO statistics reveal that 4.1 billion people worldwide lack social protection, with only 29% of the global population enjoying adequate coverage and 55% having no coverage at all.

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