More from UNDESA Vol 22, No. 10 - October 2018

Reducing inequality remains a priority amidst rising trade tensions

Global measures to fight inequalities and poverty

Reducing inequality and accelerating growth of median incomes remain crucial challenges in many countries across the world. While several developing countries made progress towards reducing inequality during the commodity price boom of the 2000s, these improvements were largely cyclical and subject to volatility in global commodity markets. More significant improvements in line with the global goals targets, will require structural policy initiatives. To this end, countries are aligning their development strategies with specific SDGs targets, including SDG 1 – eradicating poverty – and SDG 10 – reducing inequalities.

Among the transition economies, the Russian Federation has recorded one of the highest levels of income inequality since the early 1990s. This can be attributed to the fast speed of transition which was accompanied by hyperinflation, and widespread wage arrears eroding incomes of those at the bottom of the income distribution. However, the recently adopted social development target to halve poverty by 2024 should contribute to declines in inequality.
In Egypt, recent policies reflect the evolving role of the government in addressing inequality and poverty. Price control measures were once applied in many parts of Africa as a key social protection policy tool to maintain stable prices of essential goods. However, these types of blanket subsidies are not the most effective tool to alleviate poverty and inequality. Recent evaluations of more targeted social protection policy measures, including conditional and unconditional cash transfers, are more encouraging for SDG 1 and 10.

Fiscal adjustments

Economic diversification remains a primary policy goal for the Gulf Cooperation Council (GCC). The introduction of a value-added tax (VAT) marks a historic milestone not only for fiscal revenue diversification but also for the social contract between the state and its citizens. The introduction of the VAT has created a valuable administrative infrastructure, which can act as a cornerstone for further economic and fiscal change in the GCC countries.

Across Latin America, fiscal pressures are creating significant policy challenges, forcing greater fiscal adjustments. The situation is particularly challenging in Argentina, which entered a Standby-Agreement with the IMF in June. To restore market confidence, the country’s new austerity measures comprise both cuts to public expenditure and higher tax revenues. The new programme threatens to push the economy into a prolonged recession, which could hit vulnerable populations hard.

Rising tensions

In the United States, major changes in the level and structure of taxation are expected to stimulate economic growth. However, income inequality will likely increase since high-income households and corporations reap the highest levels of tax relief. Recently, the US also imposed more tariffs on Chinese goods. In response, China announced retaliatory measures along with pro-growth strategies aimed at mitigating the effects of rising trade tensions on the domestic economy.

China’s plans to attract more investment into the high technology sectors is likely to lead to productivity and employment gains. The government also introduced their ‘National Plan on Implementation of the 2030 Agenda,’ which contains provisions to “sustain income growth of the bottom 40 per cent of the population at a rate higher than the national average.”

Learn more in the latest World Economic Situation and Prospects Monthly Briefing

Building an inclusive world of universal respect for human rights and dignity

As we celebrate the 70th anniversary of the proclamation of the Universal Declaration of Human Rights this year, it is important to recall the important connection between inclusive development and human rights, and that people living in poverty are affected by many human rights violations.

The persistence of poverty, including extreme poverty, is a major concern for the United Nations and, at its 72nd session, the General Assembly launched the Third United Nations Decade for the Eradication of Poverty (2018–2027), under the theme “Accelerating global actions for a world without poverty”. It is important that the Third Decade’s inter-agency, system-wide plan of action to coordinate the poverty eradication efforts of the United Nations system includes an effective partnership with people living with poverty.

To show solidarity with people living in poverty, the United Nations will commemorate the 2018 International Day for the Eradication of Poverty at UN Headquarters in New York on 17 October. The Day reminds us that we need to include people living in poverty as partners in building inclusive societies for all, and that we need to come together to promote the values of solidarity and their concerns.

The commemoration event will be organized in partnership with the International Movement ATD Fourth World, the NGO Sub-committee for the Eradication of Poverty and UN DESA, supported by the Missions of France and Burkina Faso to the United Nations.

Towards building inclusive societies for all

Joseph Wresinski was one of the first persons to highlight this direct link between human rights and extreme poverty. In February 1987, he appealed to the Human Rights Commission to examine the question of extreme poverty and human rights and eloquently captured the nexus between human rights and extreme poverty with his profound observation: “Wherever men and women are condemned to live in extreme poverty, human rights are violated. To come together to ensure that these rights be respected is our solemn duty.”

The 2018 theme, “Coming together with those furthest behind to build an inclusive world of universal respect for human rights and dignity” reminds us of the importance of the values of dignity and solidarity, as well as the call to action to end poverty everywhere.

Join the #EndPoverty global campaign

Everyone can join the campaign on social media by using hashtag #EndPoverty and promoting the call to action to connect with people from around the world who have joined the fight to overcome poverty.

In addition to the commemorative event to be held in New York on 17 October, commemorations of the international day are being organized worldwide. The online community is asked to use #EndPoverty to share messages about the International Day for the Eradication of Poverty via social media.

For more information:

2018 International Day for the Eradication of Poverty

UN DPI’s website on the International Day for the Eradication of Poverty

ATD Fourth World

Overcoming Extreme Poverty

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