The financial crisis will have gender-specific impacts according to this World Bank document. It may increase poverty by reducing women's employment, access to microcredit, and remittances sent to families. Ignoring these effects could hamper current poverty reduction and long-term development. The document recommends responding with policies that protect women's incomes, such as employment programs, cash transfers, and capitalizing microcredit, especially in countries where women are most vulnerable.

1. Impact of Financial Crisis on
Women and Families
PREM Gender and Development, World Bank
February 2009
1

2. 3 Main Messages
The financial crisis will have gender-specific impacts.
Effects on women and children,
if ignored, will both increase
current poverty and imperil
future development.
Effective policy responses
should build on women’s roles
as economic agents.
2

3. Impacts
3

4. The crisis has first and second round impact
on women and families
Impact 1:
Drop in
Loss of
aggregate
demand/ exports employment
Tightened
Drop in
Impact 3:
credit Impact 2: household income.
markets Vulnerable
Fall in MFI Increased risk
hhd coping
of poverty
lending resources
strategies
Drop in
remittances
Food price
shocks
Second round impacts
First round impacts 4

5. Impact 1: Women workers in export industries lose jobs
Export Manufacturing
Country Industry % of
workforce
female
Malaysia Garments 78%
Bangladesh Garments 85%
Philippines Electronics More than
50%
High Value Export Agriculture
Country Industry % of
workforce
female
Uganda Cut flower 85%
Ecuador Cut flower 70%
Thailand Fruits 80% 5

6. Impact 2: Tightening credit markets can squeeze MFI loans
to women producers
MFIs typically lend to women:
Over 3,330 MFIs reached 133
million clients in 2006
93 million of the clients were
among the poorest when they
took their first loan
85% of these poorest clients were
women
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7. Drop in remittances lowers income available to HHS
Falling Remittances to Developing Countries (as % of GDP)
2008-2009
Cape Verde
Haiti
Kyrgyz Republic
Tajikistan
Uzbekistan
Afghanistan
-14% -12% -10% -8% -6% -4% -2% 0%
Source: World Bank (2009)
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8. HH Coping Strategy
HHs send women to work
% C hang e in Lab o r F o r ce Par t icip at io n ( 19 9 3 - 9 5) ,
Lat in A mer ican C r isis
3
2
1
Female
0
-1 Argentina Brazil Mexico
Male
-2
-3
% Change in Labor Force Participation (1997-99),
East Asian Crisis
3
2
1
0
-1
-2
-3
Indonesia Korea,Rep. Philippines
8
Source: WDI, 2008

9. HH Coping Strategy
HHs pull girls (and boys) out of school
Low income countries:
Madagascar (fall in ag income) girls more likely to
drop out of schools.
Cote d’Ivoire (drought) enrollment decreased 11 ppts
for girls and 14 ppts for boys.
Middle income countries:
Mexico (peso crisis) girls attendance fell by 8%, no
impact on boys.
Peru (1980s crisis) no impact on school enrollment
for either girls or boys, schooling increased.
9
Source: Gubert and Robilliard 2007; Jensen (2000); Skoufias and Parker 2006; Schady (2004).

10. HH Coping Strategy
HHs cut back on health investments,
affecting girls disproportionately
Girls’ (IMR) exceeds boys’ during economic downturns
Data from 59 developing countries, different years ranging from 1985 to 2004
10
Source: Baird, Freedman and Schady, 1998

11. Policy implications
11

12. Priority Investment:
Put income in women’s hands in poor hh
because….
12

13. …because loss of women’s earnings can have
long-term welfare impacts
Loss of employment Drop in current
for women in export poverty reduction
oriented industries and economic growth
Drop in Drop in future poverty
female reduction and
earnings economic growth
Microfinance likely
to be affected
Fall in women’s control over
(MFI borrowers
household decisions
are typically women)
Greater impact on
well-being of
children
Fall in
remittances
13

14. ...because income transfers to women have larger effects on
children’s nutritional status than similar transfers to men.
Woman's income Man's income
Children’s
height for age
100
anthropometric measure
% change in child's
80
Children’s weight Children’s height
60
for height for age
40
20
0
Brazil Bangladesh South Africa
-20
Source: Thomas (1990) for Brazil, Khandker (1998) for Bangladesh, and Duflo (2003) for South Africa.
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15. … because the effect of female borrowing on hh welfare is
larger than the effect of male borrowing (e.g. Bangladesh)
Impact of a 10% increase in borrowing
from Grameen Bank
11.63
1
0.8
Percentage change
0.6
0.43
0.4
0.18
0.2
0.015
0
-0.06
-0.2
-4.92
Per Capita HH expend. Women's Labor Supply Girls' height for age
Borrowing by Women Borrowing by Men
15
Source: Khander (1998)

16. ..especially in more than half in a sample
of countries, where women are most
vulnerable to effects of the crisis.
16

17. Women & girls in 50% of countries in the sample (of 90)
face moderate to high exposure to negative impact of crisis
Decelerating
High Child
growth
Mortality
Low gender
parity in
schooling
17

18. Bank’s Response
18

19. Mapping impacts to policy
Impacts Policy/programs
Women’s employment Employment generation programs
Women and girls’ Cash transfer programs
human development Other social safety net programs
Capitalization of microcredit
Women producers
19

20. Bank’s Response
World Bank Group’s Gender Action Plan will
allocate its financial resources in 2009 to
assist in ensuring that WBG responses to the
crisis maximize women’s income, especially
in those countries where women and girls are
most vulnerable to the effects of the crisis.
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