UN proposes basic income to curb coronavirus spread in poor nations

The United Nations Development Programme has proposed the immediate introduction of a temporary basic income that could curtail the spread of the coronavirus pandemic by allowing the world’s poorest people to stay at home.

The proposed plan was disclosed in a report published by the agency on Thursday July 23, 2020.

The report states that six-month guaranteed handout for 2.7 billion living below or just above the poverty line in 132 developing countries would cost around US$199 billion (S$275 billion) per month and could be funded by re-purposing external debt service payments.

According to the UN Secretary-General, Antonio Guterres, with the rate of infections increasing in many poorer nations with debt costs crowding out health and social expenses, has called for a standstill for all developing economies.

Those countries are set to spend US$3.1 trillion in debt repayments this year and the UNDP said its proposal would allow them to briefly re-purpose the funds to address the damage wrought by the crisis.

“The plan would require 12 per cent of the expected total financial response to pandemic in 2020, which is equivalent to one-third of what developing countries owe in external debt payments this year,” the UNDP said.

Already the Group of 20 leading economies has offered a Debt Service Suspension Initiative to the world’s poorest nations that runs through December.

So far, 42 countries have requested help under the plan, leading to the suspension of US$5.3 billion in repayments.

“Unprecedented times call for unprecedented social and economic measures,” Mr Achim Steiner, the UNDP’s administrator said in a statement.

“A temporary basic income might enable governments to give people in lockdown a financial lifeline, inject cash back into local economies to help keep small businesses afloat, and slow the devastating spread of Covid-19,” he said.
Source: MCR and News Agency