UN Strengthens Efforts to Reduce Socio-Economic Impact of COVID-19

The coronavirus outbreak is causing a global health emergency. It is also resulting in a global economic slowdown. In Myanmar and around the world, trade, investment, growth, and employment and small-scale income mechanisms are all affected. Together with its broader support in efforts to contain the spread of the virus, the United Nations is working with the Government of Myanmar to reduce the economic impact of COVID-19 on small-scale enterprises.

The European Union has mobilized a €5 million emergency cash fund for garment sector workers through its Nexus Response for Myanmar, which is managed by the United Nations Office for Project Services (UNOPS). In the current circumstance, out of 700,000 workers in the apparel industry, an estimated 350,000 are at risk of either being suspended without pay or losing their jobs permanently. This emergency cash fund will aim to reach more than 80,000 people who face the impact of COVID-19.

The Livelihoods and Food Security Fund (LIFT), funded by the United Kingdom, the European Union, Australia, Switzerland, the United States of America, Canada and Ireland and managed by UNOPS, has allocated US$3 million for its capital market programme, increasing liquidity through microfinance institutions (MFIs). The new funding will allow MFIs to access a total of US$60 million loan capital, which in turn will benefit around 500,000 people. The funding will allow MFIs to offer loan top-ups of US$100-200 to clients in areas expected to be hit hard by COVID-19. Beneficiaries will include households, farmers and garment workers.

The United Nations Development Programme (UNDP) has collaborated with the Directorate of Industrial Supervision and Inspection of the Ministry of Planning, Finance and Industry to support small-scale businesses from Yangon, Sittwe and Mandalay to prepare and submit loan applications to COVID-19 Fund set up by the Government of Myanmar at one per cent rate of interest for a one-year period. A fund of 100 billion Myanmar Kyats has been set up to provide immediate loans to enterprises designated in sectors impacted by the COVID-19. The categories include Cut Make Pack enterprises, hotels and tourism, and small and medium enterprises. UNDP has facilitated over 180 applications since the Fund was established in early April.

COVID-19 has also exposed gender inequalities in the business sector. In Myanmar, women represent 60 per cent of the employee engaged in the food and accommodation services, and between 70 to 90 per cent of the street food vendors. Women also constitute the majority of Myanmar garment workers, many of whom already affected by factory closures. Women’s economic empowerment includes their ability to participate equally in existing markets; their access to and control over productive resources, access to decent work, control over their own time, lives and bodies; and increased voice, and meaningful participation in economic decision-making at all levels from the household to international institutions.

Women’s economic empowerment is essential in driving economic development forward, and global evidence proves that the inclusion of women in the economy increases and boosts GDP growth, productivity, economic diversification and income equality. To support a gender sensitive response, UN Women is working through its regional #WeEmpowerAsia program supported by the European Union to lead two surveys focusing on women’s economic empowerment. The first survey will look at the impact

of the COVID-19 on women entrepreneurs and facilities supporting women entrepreneurs, while the second looks at the impact of the crisis on employees. The results that will be shared with the government and development partners, will be used to develop initiatives that fully address the needs of women in the private sector.

The Myanmar Sustainable Development Plan notes that small-scale businesses are vital for private sector-led economic growth and are essential for sustained, broad-based job creation. The United Nations is committed to foster economic empowerment, including through gender equality in the 2030 Agenda for Sustainable Development.

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