BANGKOK, Nov 30: The global economic slowdown is expected to push millions more people into poverty, making it imperative that Asia Pacific countries remain committed to social and economic reforms, a UN report said on Friday.

The inaugural mid-term economic report by the Bangkok-based United Nation’s Economic and Social Commission for Asia and the Pacific (ESCAP) described the current slump as the “first truly global downturn since the Second World War”,

Worst affected in Asia would be countries with a a high dependence on exports to the the US, such as Malaysia, Singapore, Taiwan and South Korea.

The downturn could lead to cuts in government spending on health, education and social security in developing countries in the Asia Pacific region, putting many people below the poverty line, warned the report compiled by 14 regional economists.

A World Bank report published in October estimated the aftermath of the September 11 attacks could push another 10 million people into poverty in 2002, especially in those countries reliant on tourism and export revenue.

ESCAP said developing countries in the region that relied on remittances from overseas foreign labour, such as the Philippines, Indonesia and Vietnam, could also struggle as nations tightened work visas and sent some foreign workers home.

As a result of the downturn, the United Nations Millennium Declaration’s goal of halving poverty by 2015 would be unattainable in some countries.

But ESCAP urged Asia Pacific countries to remain committed to their economic and social reforms, including those agreed following the 1997 financial crisis.

“Major policy initiatives at the national, regional and international levels are required,” the report said.

“Well-targeted state spending — with an emphasis on quality rather than quantity — should be initiated, particularly with a view to fighting poverty.

“Spending on infrastructure, especially in rural areas, is a route that governments could take that would improve medium-term competitiveness,” it added.

On the regional level, ESCAP urged Asia Pacific countries to focus on growth to offset the downturn in the rest of world. The more developed countries in the region should open their markets to developing neighbours and intra-regional trade should be increased.

Internationally, the International Monetary Fund should speed up disbursements to small and developing economies while “paying greater attention to the economic conditions of individual countries”.

The region would also benefit from a new round of World Trade Organization negotiations, especially if developing countries “clubbed together in negotiating groups to obtain concessions from more powerful trading partners,” it said.—AFP