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ILO calculates deficits for social protection in the world

Geneva, May 20 (Prensa Latina) Low and middle-income countries would need to spend an additional 1.4 trillion dollars a year to guarantee universal social protection, the ILO said.

The new study by the International Labor Organization (ILO) showed that the current funding gap is alarming, amounting to 3,3% of the annual Gross Domestic Product (GDP) of low and middle-income nations combined.

But the challenges are “even greater for low-income countries, where the financing gap for social protection reaches a staggering 52,3% of annual GDP,” the document states.

To achieve universal coverage, low and middle-income countries will need additional public spending of 10,6% annually, which could be achieved from domestic resources, including taxes and social security contributions, as well as through better management of sovereign debt, the ILO said.

Low-income countries need to mobilize funds amounting to four times annual public spending to address the gap, so international solidarity is needed, the ILO said.

In order to offset such deficits, development aid would have to be more than tripled and allocated exclusively to social protection, the UN agency concluded.

At the regional level, the results show that Africa faces the greatest challenges, with a funding gap of 17,6% of the continent’s annual GDP, followed by the low and middle-income countries of the Arab States (11,4), Latin America and the Caribbean (2,7), Asia and the Pacific (2,0) and Europe and Central Asia (1,9%), the report said.

The ILO also called for an increase in international climate financing, considering that it can help strengthen and adapt social protection systems in impoverished nations.