Vulnerability and Safety Nets in Lao PDR

Lao PDR has experienced high levels of economic growth in recent years and the incidence of poverty has fallen dramatically since the 1990s. Yet, this report shows that Lao households continue to be highly vulnerable to regular seasonal fluctuation...

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Bibliographic Details
Main Authors:	Lindelow, Magnus, Fenton, Nina
Format:	Policy Note
Language:	English en_US
Published:	World Bank, Washington, DC 2013
Subjects:	ACCESS TO CREDIT ACCESS TO SERVICES ADMINISTRATIVE COSTS AFFORDABLE PRICES AGRICULTURAL SECTOR AGRICULTURAL SECTORS AGRICULTURAL SHOCKS BENEFICIARIES BIRTH GRANT BORROWING BUSINESS CONFIDENCE CASH BENEFIT CASH CROPS CASH TRANSFER CASH TRANSFER PROGRAMS CASH TRANSFERS CHAMBER OF COMMERCE CHILD HEALTH CHILD LABOUR CHRONICALLY POOR CLIMATE CHANGE CLINICS COMMUNITY ASSETS CONDITIONAL CASH CONSUMER CONFIDENCE COPING BEHAVIORS COPING STRATEGIES CREDIT MARKETS CRIME DISABLED DISASTERS DIVERSIFICATION DOMESTIC VIOLENCE DROUGHT EARNING CAPACITY EARNINGS ECONOMIC ACTIVITY ECONOMIC CHARACTERISTICS ECONOMIC CRISES ECONOMIC CRISIS ECONOMIC GROWTH ECONOMIC POLICY ECONOMIC SHOCK EMERGENCY FOOD EMPLOYEE EMPLOYERS EMPLOYMENT CREATION EMPLOYMENT OPPORTUNITIES ENROLLMENT EQUITY FUNDS ETHNIC GROUP ETHNIC GROUPS ETHNIC MINORITIES ETHNIC MINORITY ETHNIC MINORITY HOUSEHOLDS EXPENDITURE FAMILIES FARM SECTOR FARM WORK FARMERS FEE WAIVERS FEMALE-HEADED HOUSEHOLDS FINANCIAL COSTS FINANCIAL CRISES FINANCIAL CRISIS FINANCIAL DISTRESS FINANCIAL MARKETS FINANCIAL PROTECTION FINANCIAL RISK FINANCIAL SUSTAINABILITY FOOD CONSUMPTION FOOD EXPENDITURES FOOD INSECURITY FOOD ITEMS FOOD PRICE FOOD PRICES FOOD PROCESSING FOOD PROGRAM FOOD SECURITY FOOD TRANSFER FOOD TRANSFERS FOOD-FOR-WORK FOREIGN DIRECT INVESTMENT FORMAL INSURANCE FORMAL SAFETY NETS HANDICRAFT HEALTH BENEFITS HEALTH CARE HEALTH CARE SERVICES HEALTH EXPENDITURES HEALTH INSURANCE HEALTH SERVICES HEALTH SYSTEM HOME RATION HOME RATIONS HOSPITALS HOUSEHOLD CONSUMPTION HOUSEHOLD LEVEL HOUSEHOLD SIZE HOUSEHOLD WELFARE HUMAN CAPITAL HUMAN DEVELOPMENT INCIDENCE OF POVERTY INCOME INCOME GROWTH INFORMAL SAFETY NETS INPUT PRICE IRRIGATION IRRIGATION SYSTEMS JOB CREATION JOB LOSS KEY CHALLENGES LABOR DEMAND LABOR FORCE SURVEYS LABOR MARKET LABOR MARKET POLICIES LABOR MARKET PROGRAMS LABOR SUPPLY LABOUR FORCE LABOUR FORCE PARTICIPATION LACK OF ACCESS LACK OF CREDIT LACK OF KNOWLEDGE LAND RIGHTS LEAN SEASON LIVELIHOOD SUPPORT LIVING CONDITIONS LOSS OF INCOME MALNUTRITION MARKET ECONOMY MARKET PRICES MEDICAL SERVICES MIGRANT REMITTANCES MIGRANT WORKERS MIGRANTS MIGRATION MINIMUM WAGE MINIMUM WAGES MINORITY GROUPS NATURAL DISASTERS NUTRITION NUTRITION PROJECT NUTRITIONAL STATUS PARTICIPATORY POVERTY ASSESSMENTS PATIENT PATIENTS PENSION POCKET EXPENDITURES POCKET PAYMENTS POOR POOR SOIL QUALITY POVERTY ERADICATION POVERTY PROFILE POVERTY REDUCTION POVERTY TRAPS PRECAUTIONARY SAVINGS PRICE FLOOR PRICE STABILITY PRICE STABILIZATION PRICE SUBSIDIES PRODUCTIVE ASSETS PROVISION OF CREDIT PUBLIC FACILITIES PUBLIC INFRASTRUCTURE PUBLIC SERVICES PUBLIC WORKS PUBLIC WORKS PROGRAMS PURCHASING POWER RECESSION REGISTRATION PROCESS RELIEF FOOD REMITTANCES REMOTE AREAS REMOTE RURAL AREAS RISK AVOIDANCE RISK MANAGEMENT RURAL RURAL COMMUNITIES RURAL HOUSEHOLDS RURAL INCOMES RURAL ROAD RURAL VILLAGES SAFE WATER SAFETY NET SAFETY NET PROGRAMS SAFETY NETS SANITATION SCHOLARSHIP SCHOLARSHIPS SCHOOL ENROLLMENTS SCHOOL FEEDING SCHOOL FEEDING PROGRAMS SCHOOL VOUCHERS SECONDARY SCHOOLS SERVICE PROVIDERS SHOCK SIBLINGS SITE FEEDING SMALL FARMS SOCIAL ASSISTANCE SOCIAL NETWORKS SOCIAL PENSION SOCIAL PROTECTION SOCIAL SAFETY NETS SOCIAL SECURITY SOCIAL SERVICES SOCIAL WELFARE SOURCE OF INCOME TARGETING TRADE UNIONS TRANSACTION COSTS TRANSFER PROGRAM TRANSFER PROGRAMS UNEMPLOYMENT UNEMPLOYMENT BENEFIT UNION URBAN AREA URBAN AREAS USER CHARGES USER FEES VILLAGE VILLAGE LEADERS VILLAGES VIOLENCE VOCATIONAL TRAINING VULNERABLE GROUPS VULNERABLE HOUSEHOLDS WAGE DIFFERENTIALS WELFARE PROGRAMS WORKERS WORKFARE
Online Access:	http://documents.worldbank.org/curated/en/2009/12/16426369/vulnerability-safety-nets-lao-pdr http://hdl.handle.net/10986/12804

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Summary:	Lao PDR has experienced high levels of economic growth in recent years and the incidence of poverty has fallen dramatically since the 1990s. Yet, this report shows that Lao households continue to be highly vulnerable to regular seasonal fluctuations, as well as agricultural shocks and natural disasters. The report also highlights the importance of health shocks, injury and death for household welfare. Households adopt a variety of strategies to cope with these shocks, but in many cases are unable to fully smooth consumption, with negative short and long term consequences. Overall, the report points to a number of important vulnerable groups. The chronic poor in remote rural areas, including ethnic minority groups, remain highly vulnerable to seasonal fluctuations and natural disasters. However, households in urban areas, particularly the poor and near-poor, are vulnerable to future increases in food prices if they are not accompanied by increases in real wages. Moreover, as the Lao economy develops, more households will rely on off-farm work or migrant remittances, making them increasingly vulnerable to domestic and global macro-shocks. Finally, particular groups, including children, women, the disabled and the elderly are likely to be particularly badly affected by these shocks. The report goes on to discuss the potential value of social safety nets. Safety nets can reduce poverty and alleviate suffering for households who are unable to fully smooth their consumption after a shock. But effective safety nets don't just contribute to reducing poverty in the short term; they can also prevent long term poverty traps from arising (e.g. due to households being forced to sell productive assets, withdraw children from school, or reduce consumption below nutritionally adequate levels), and enable households to pursue riskier but more productive livelihood strategies. The report reveals important gaps in current policies and programs and suggests some potential directions towards implementing a comprehensive and institutionalized safety net program in Lao PDR. This will require substantial investments, not only to finance the actual programs, but also to develop the required capacity and knowledge at both local and central levels. While there are no easy solutions, reaching consensus on priorities and policy options for addressing vulnerability in Laos is essential if recent progress in poverty reduction and economic growth is to be sustained and deepened.

Vulnerability and Safety Nets in Lao PDR

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