Regional : Developing Inclusive and Resilient Social Protection Systems in Asia and the Pacific

Education / Technical and vocational education and training

Finance / Inclusive finance

Information and communication technology / ICT industries and ICT-enabled services

Public sector management / Social protection initiatives

This knowledge and support technical assistance (TA) will help develop inclusive and resilient social protection systems in Asia and the Pacific region by (i) strengthening social protection systems and policies, (ii) developing resilient and integrated solutions that can amplify development impacts and support inclusion, and (iii) providing catalytic support to develop inclusive and resilient social protection projects. The TA will help Asian Development Bank (ADB) developing member countries (DMCs) design and expand social protection measures through capacity building, knowledge generation, and support for project development.

The TA will contribute to ADB's Strategy 2030, operational priority 1 (addressing remaining poverty and reducing inequality) and will support implementation of the Social Protection Directional Guide 2022-2030. It will build on outputs of two ongoing but soon-to-close TA operations on social protection implemented by the Sustainable Development and Climate Change Department: (i) Strategies for Financing Social Protection to Achieve Sustainable Development Goals in Developing Member Countries and (ii) Enhancing ADB's Support for Social Protection to Achieve the Sustainable Development Goals. This TA will complement ADB's contribution to an inclusive recovery from the coronavirus disease (COVID-19) pandemic, strengthening resilience to existing and new risks, and augmenting ongoing efforts by ADB's regional departments to develop a robust pipeline of impactful support to social protection systems in Asia and the Pacific.

Social protection is one of the most effective measures to reduce poverty and inequality, and promote inclusive development. Many social protection systems in Asia and the Pacific still have limited coverage, expenditure, range of programs, and ability to deal effectively with the impacts of crises and shocks (e.g., health, financial, and disaster). ADB's Social Protection Indicator (SPI) estimates that about 53.5% of social protection's target population in the region is covered by at least one social protection benefit. Expenditure is growing - largely the result of the expansion in social insurance that primarily benefits workers in the formal sector - but is still low (about 5.5% of gross domestic product). Investment in key areas, such as labor market programs, remains inadequate. Large segments of the population without coverage comprise mainly women, workers in the informal sector (70% of the labor force in the region; about 64% of women in the region work in the informal sector), and migrant workers.

The COVID-19 pandemic highlighted the importance of strengthening social protection systems and service delivery. ADB estimates that the COVID-19 crisis pushed an additional 78 million people into poverty in Asia and the Pacific, reversing gains in poverty reduction over the previous 3-4 years before the pandemic. Most countries deployed social protection measures as a pillar of their response, particularly to protect the most vulnerable. The post-pandemic world brought about a set of new polycrises, including slow economic growth, global inflation exacerbated by the Russian invasion of Ukraine, rising geopolitical tensions, food insecurity, and elevated risk of social unrest. Rapid demographic transitions in some countries have increased the need for old age income security and appropriate health and social care services. The region is also facing structural changes and disruptions from climate change and must prepare for future shocks and stresses.

Many ADB DMCs have underdeveloped social protection systems and face fiscal constraints that limit their ability to manage risk and strengthen the adaptive capacity of systems and populations. This underscores the importance of strengthening sustainable financing mechanisms and developing adaptive and shock-responsive social protection systems that can mitigate the impacts of climate, economic, environmental, and political crises. To increase resilience and address multifaceted constraints, interventions require integrated approaches with social protection programs to help amplify the development impacts in other sectors. Examples include (i) social protection for economic inclusion programs, (ii) digitalization that improves the management of programs and delivery of services, (iii) expansion of social care and support services addressing lifecycle vulnerabilities, and (iv) social protection integrated with food security programming. These factors highlight the opportunities for developing a pipeline and strengthening social protection programs and systems in ADB DMCs.

ADB's Independent Evaluation Department (IED) noted that, under Strategy 2020, ADB's social protection lending and TA were primarily crisis-driven and did not seek deeper engagement to develop and strengthen national social protection systems. The low priority that ADB and its DMCs gave to social protection resulted in a small and scattered social protection portfolio. System strengthening requires sustained engagement in DMCs through (i) country partnership strategies (CPSs); (ii) broader dialogue on macroeconomic and fiscal reforms; and (iii) continued development of knowledge, effective partnerships to support operations, and cofinancing. In response to these lessons, this TA will help ADB be a more effective development partner in social protection in the region.

Inclusiveness and resilience of social protection systems in Asia and the Pacific strengthened

Capacity of developing member countries to develop inclusive and resilient social protection systems improved

Studies and capacity building on inclusive and resilient social protection systems and policies completed

Social protection measures with resilient integrated solutions developed and disseminated

Inclusive and resilient social protection systems in operations supported