A strategy to fight poverty

In programmes aimed at tackling poverty, specific goals have been created and efforts concentrated or focused on meeting those targeted goals. Through this approach there has been some progress in poverty reduction since 1970, although it has not been spread equally over the different parts of the world. Most of the decline in poverty took place in East Asia, notably in China. In developing countries, infant mortality was cut by more than 40% and adult illiteracy by 50%. A newborn baby can expect to live 10 years longer, and combined net primary and secondary school enrolment has increased by nearly 50%. But there have also been reversals over the last few years, and huge problems remain. 

Based on the experience of the past years, there is now a growing consensus among national and international policy makers on what works and what does not in fighting poverty. Policies that are part of the successful poverty reduction package of different countries include the following:

Inclusive and broad-based economic growth: Economic growth is one of the most important factors in helping to reduce poverty, but it is not sufficient. The effectiveness of economic growth in reducing poverty depends upon the structure of growth, existing levels of inequality and on how the benefits of growth are distributed. 

Inequality in income is a function of the distribution of economic assets (land, industrial and financial capital), and so-called "human capital" in the form of education and skills. Governments need to work on creating more equity in the distribution of income and assets. 

The effectiveness of growth in reducing poverty also depends on the extent of growth and employment opportunities created, and whether it takes place in areas and sectors where the poor are located. In most cases, with the exception of the South East Asian countries (Republic of Korea, Taiwan Province of China, Malaysia, etc.) in their high growth phase, there has not been sufficient employment generation in the formal sector of the economy. Attention now needs to be paid to the informal sector of the economy. 

• According to the Secretary-General's Millennium Report, a 1 per cent increase in a country's gross domestic product can bring about an increase in the incomes of the poorest 20 per cent of the population. But this cannot happen where inequalities in society do not permit growth to benefit the poor. 

• China is an example of what could be achieved by rapid economic growth built on investment in people: the gap in average income between China and the rest of the world has decreased by over 50 % compared to 40 years ago.

However, prospects for growth in the world economy currently are rather bleak. The world economy appears to be growing too slowly to create enough jobs or to make a real impact on poverty. Even the industrialized countries appear to be stuck with high unemployment, a major cause of poverty. This suggests that economies cannot rely on growth to pull them out of poverty, but must take specific steps to target poverty reduction directly. 

Growth, if it is achieved at the cost of environmental degradation, can also undermine the livelihoods of the poor who are dependent upon these resources. Hence, development policies need to be sensitive to the social and economic environments of the poor. 

• After the 1992 Earth Summit (Rio de Janeiro, Brazil), the Philippines was the first country to establish a council for sustainable development with partners from Government, civil society and private business. Key businesses worked to implement sustainable development initiatives – reusing by-products, controlling pollution levels and including environmental provisions in collective bargaining agreements with labour unions.  

Realizing Globalization's Potential: The phenomenon of large corporations operating in many countries, in the hands of private individuals who make decisions about opening/closing and reorganizing operations that affect the lives of many people, is a reality of this new millennium. The process called globalization and increased economic integration offer countries many positive market and employment opportunities. But there are also risks and problems associated with it. The poor in poor countries at this time are often victims of this process. (See Briefing Paper on Globalization for a more comprehensive discussion of its pros and cons.) Countries need to prepare themselves for globalization by: 

Even after they have done all this, nothing is guaranteed. Markets may be saturated and despite globalization, many industrialized countries also still protect their markets with tariffs and quotas and discriminate against the products of developing countries. Better trade policies, fairer rules and terms that allow poor countries to enter developed country markets need to be put in place. The United Nations Secretary-General has urged all industrialized countries to consider granting duty-free and quota-free access for essentially all exports from the least developed countries. Governments and international agencies also need to work on preparing countries assisting them in developing regulatory policies that will soften the negative impact of volatile financial flows. 

Promoting good governance, accountability and participation: Honest and fair government practices, free of corruption; decision making open to the input of the public; and follow-up actions in accordance with decisions made, are measures needed to eradicate poverty.. Of prime importance are:

Key in bringing this about is the role that civil society can play, as is the process of allowing and encouraging the participation of the poor themselves in the making of policies, especially those that affect them directly. There is a clear link between empowering the poor and overcoming poverty. According to the UNDP Poverty Report 2000: 

 

• In Andhra Pradesh, India, women organized themselves into self-help groups (SHG), which mobilized community savings, created opportunities for income generation for women via the increased access to credit and through a focus on skill formation and improved the status of women. The groups mobilized the community to make recommendations about loan priorities, and also tried to reduce or eliminate child labor and improve the condition of girls.   Similarly, in Cambodia, local communities developed their own anti-poverty projects. Villagers brainstormed about their problems, they asked questions of officials and expressed their opinions about how best to do things.   In Bulgaria, self-governing civic organizations increasingly provided vocational training, fostering new businesses, protecting the environment and resolving conflicts.

 

Provision of basic services and budgetary policies: The way in which public resources are mobilized and spent determines the kind of impact that it has on poverty. A fair and equitable public budgetary policy (relating to expenditure, taxation and government fiscal priorities) can also help to promote economic growth, reduce inequality and make development more pro-poor. Examples of success in pro-poor and participatory budgetary policies can be found in India, Brazil and Uganda. 

Bringing about improvements in the quality of life, or reducing the level of deprivation, is a function not only of the resources available but also of the economic and social priorities and policies of government. Reducing the impact of the various dimensions of poverty is possible, even at low levels of income. Government spending on health and education, in combination with other policies that promote equitable growth, is particularly important in addressing poverty. Such social provisioning policies can help:

Countries such as Costa Rica, Cuba, Sri Lanka and Viet Nam and the state of Kerala in India have secured better health conditions, greater reductions in mortality and improvements in literacy over others with similar or greater economic resources. Viet Nam, with a per capita income of $350, has a lower infant mortality (31 as compared to 60 per 1,000 live births) and higher adult literacy (92.9% as compared to 84.6%) than South Africa, which has a per-capita income of $3,310. 

Mauritius, a small island nation in the Indian Ocean cut its military budget and invested heavily in health and education. Today, all Mauritians have access to sanitation, 98 per cent to safe water and 97 per cent of births are attended by skilled health staff. 

Achieving Gender Equity: More women than men live in absolute poverty. Economic crises have often hit them harder. Few of them tend to get fewer skilled jobs, and in situations of growing unemployment they are often the first to lose their jobs. This increases their vulnerability and makes them more susceptible to falling into poverty, a phenomenon referred to as the feminization of poverty. 

Yet, as mentioned earlier, experience has shown that investment in girls’ and women's education translates directly into better nutrition for the family, better health care and declining fertility. It has also been widely acknowledged that poverty is unlikely to be overcome without specific immediate and sustained attention to girls' education and women's empowerment. According to one estimate, closing the gender gap in education adds 0.5 percentage points to annual growth in GNP per capita. 

National and International targets for poverty reduction: Throughout the 1990s, a series of international conferences on global development issues was held, with the eradication of poverty as a central goal. The World Summit for Social Development in 1995 expanded the context of poverty eradication to include such factors as

At the summit, 117 nations pledged that their countries would take steps to eradicate poverty. Following the summit, countries were expected to establish national targets and policies to eradicate poverty. According to UNDP's Poverty Report 2000: "as of 2000, 97 countries (69%) have developed explicit, stand-alone poverty plans, and 40% have incorporated poverty into national planning." 

 

• The five-year follow-up review conference in Geneva in June 2000 recognized that "Since the Summit, globalization has presented new challenges for the fulfillment of the commitments made and the realization of the goals of the Summit … The growing interdependence of nations, which has caused economic shocks to be transmitted across national borders, as well as increased inequality, highlights weaknesses in current international and national institutional arrangements and economic and social policies, and reinforces the importance of strengthening them through appropriate reforms."

As of now, it appears that with the slow growth in the world economy, and with countries struggling to revive economic growth, there is no prospect for their reaching their poverty targets any time soon. 

Targets for a new millennium: In his Millennium Report, Secretary-General Kofi Annan lists ensuring freedom from want as the top-most priority facing humanity today. "We must spare no effort to free our fellow men and women from the abject and dehumanizing poverty," he declares. In the report, he identifies the following seven goals and sets a specific timetable for their implementation:

• By 2015, halving the proportion of people living on less than a dollar a day;
• by 2015, halving the proportion of people who suffer from hunger;
• by 2015, halving the proportion of people who are unable to obtain safe drinking water;
• by 2015, providing primary education to all girls and boys on an equal basis;
• by 2015, have halted—or even reversed—the spread of HIV/AIDS and the scourge of malaria;
• by 2015, reducing maternal mortality by three-quarters and child mortality by two-thirds; and
• by 2020, improvement in the lives of at least 100 million slum dwellers.

But how are such goals to be achieved? The Secretary-General proposes very specific actions that affluent Governments should undertake:

• Grant free access to their markets for goods produced in poorer countries;
• write off foreign debts;
• grant more generous development assistance; and
• work with pharmaceutical companies to develop an effective and affordable vaccine against HIV.