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Social Inclusion and Economic Growth in Western Balkan Countries ETF Regional Experts Meeting Torino, 13-14 November 2008 Rachel Hinton, Social Development Adviser, DFID Why Social Inclusion for a Member State? In a context where Western Balkans countries are moving towards European integration, there is a need to focus attention on social inclusion. • Peace and Security European integration Rights and SD perspective Build human capital Economic Growth Social change Changing Power Relations Social & Political Inclusion (Institutional Change) Enabling Environment Awareness (knowledge generation) Capacity Building Social Inclusion Page 3 CTL Meeting Islamabad, 18-19 September 2003 Tackling social exclusion 1. Programming in the social protection 2. 3. 4. 5. sector Policy dialogue at a technical level on social policy reform Working with partners (World Bank; UN; Member States and EC) PRSP Poverty reduction strategy processes Knowledge generation and lesson learning Page 4 Tackling social exclusion examples 1. Albania - Social Services Delivery Project 2. 3. 4. 5. community-based approaches to social care. Serbia – Employment Promotion Programme promoting active labour market measures Kosovo - the Social Protection Programme and impact of pensions claims, Minority Rights Group Roma advocacy Bosnia – joint Child Rights programme UN/EC Serbia and BiH – PRSP Knowledge generation – aid effectiveness work ODI, gender SDD, social exclusion Leslie Groves and Alan Phillips, 2008 report OA Page 5 Albania - Social Services Delivery Project Page 6 Oxford Analytica Report 2008 WHAT? Examine the impact European integration and economic reform might have on key vulnerable groups in the region. WHY? To encourage attention to social inclusion by policymakers and awareness that IPA funds can champion the issue of social inclusion in the region. Economic growth Employment European accession Social Inclusion Who are the socially excluded? Unemployed Women Children Youth Disabled Roma © Oxford Analytica Employment rate by gender in the Western Balkans (% of the population aged 15-64): 2005 (2004 for Albania and BiH) Source: ETF, 2007 9 Attention to social exclusion issues in 2007 Multi-annual Indicative Planning Documents SELECTED SOCIAL CONCERNS ALBANIA BIH KOSOVO MACEDONIA Social policy or social protection Y Y Y Y Social exclusion Y Y Y Y Income inequality H H H Y Unemployment as a concern Y Y Y Y Education, inclusive education Y Y Y Y Minorities Y Y Y Y Youth Y Y Y Y Women Y Y Y Y Refugees/idps, returnees Y Y Y 0 Disabled Y Y Y 0 Low-skilled H H H Y Health indicators Y Y Y Y Rural population H Y Y Y Source: Oxford Analytica (forthcoming) 10 ECONOMIC BENEFITS OF SOCIAL INCLUSION Economic benefits of SI policies 1. Building Human Capital HOW? 2. Facilitating access to labour markets WHY? •Potential productive source of human capital and thus economic growth. •Education and labour market policies can alleviate some forms of social exclusion. •Strong links between education and growth Policy design - © Oxford Analytica multidisciplinary in order to have the greatest impact on economic growth. Page 11 11 Unemployment rate by educational attainment (% of the Population aged 15-64): 2005 (2004 for BiH and Albania) Source: ETF, 2007 12 Strong projected gains in GDP from education reform Improvements in GDP with increases in education spending and consequent human capital (global) •Source: Hanushek and Wossmann, 2007 There are also further gains from quality education and youth employment • More informed and increased political participation • Reduced burden of social benefits • Improved understanding of health care and how to access If social exclusion remains, there are clear risks to both economic growth and to EU integration • Unemployment, including youth, can lead to social and disquiet, political riots and conflict • Waste of potential human capital, labour • Threat to EU accession by not meeting the terms of the acquis which refer to social inclusion Page 14 CONCLUSIONS IPA funding - a means to tackle social exclusion • EC funding is already being used to alleviate social exclusion in other Western Balkans countries e.g. Adult Learning Project in Croatia • In Kosovo, an IPA project was initiated this year to support vocational education and employment (10.7m euros) • In other areas of social inclusion, there are also IPA projects in civil society, reintegration of IDPs, multicultural awareness and rural development. Total IPA funds directed to social inclusion for 2007-8 amount to approx 22m euros But far more is available: To 2010, IPA funds amount to over 65m euros per annum Page 15 15 Thank you! [email protected] Tel: + 44 (0)207 023 1076