Safety Nets in Very Low-Income Countries

The idea that safety nets are an important component of economic policy in low-income countries has only started to be accepted in recent years, so practice is still relatively nascent. Even when accepted, safety nets are subject to harsh triage decisions about how to use scarce resources that characterize all policy choices in such countries. Nonetheless, a number of very poor countries are making promising progress. 

FOR PROTECTION AND PROMOTION THE DESIGN AND IMPLEMENTATION OF EFFECTIVE SAFETY NETS 

The huge needs and limited resources of very low-income countries mean that a severe triage of objectives and detailed attention to implementation are called for. Safety nets in these countries should, and usually do, focus on supplementing the incomes of the poorest to prevent irreversible losses of human capital or livelihoods. Even these will focus on a subset of the poorest, not everyone below the poverty line. Programs for covariate shocks may be funded intermittently, almost always by donors. Programs to address idiosyncratic shocks and social care services are usually not well developed or funded, and the informal sector tends to provide whatever support is available. 

A score or more Sub-Saharan African countries are working on proposals or pilots for new cash transfer schemes. We hope that in the coming years we will begin to see modest, but well-implemented, programs in many of these countries. Meanwhile, the Productive Safety Net Program (PSNP) in Ethiopia illustrates many of the issues pertinent to safety nets in very low-income settings. 

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The transformation of the prior emergency appeal system into the PSNP illustrates many of the issues that surround safety nets in very low-income countries ... 

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