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Poverty

End poverty now more than ever, Mongolia

Jim Anderson's picture

October 17 is End Poverty Day. Every day is a day to end poverty, but it helps to designate one day per year to reflect on this goal and how we can work to achieve it.

In Mongolia, poverty declined from 2010 to 2012, and again from 2012 to 2014. Since poverty rates very closely track overall economic growth, this is not surprising. Growth in labor incomes over the period helped reduce poverty, and this growth, in turn, was generated by increases in real wages in the non-agricultural sector and non-wage income in the  agricultural sector.  Mongolia’s fondness for universal social transfers also contributed: poverty rates fell from 38.8 percent in 2010 to 21.6 percent in 2014, based on the national poverty lines.

That was then, this is now.

Although the 2016 poverty level is not yet available, we can be sure that the economic downturn has not helped. Overall growth of GDP is projected to be only 0.1 percent for 2016, with production in the non-mining sector declining. And Mongolia’s pro-cyclical policies that funded social programs in the boom years now face opposite pressures. Social welfare  programs that are categorically targeted and pro-cyclically funded are more difficult to scale up when times become difficult.

With a large and unsustainable budget deficit (projected to reach 18 percent of GDP for 2016), and with growing levels of debt, Mongolia has little choice but to focus on fiscal  consolidation. Can they do so without hurting the most vulnerable people in society?

Chart: 385 Million Children Live in Extreme Poverty

Tariq Khokhar's picture

Half the world's extremely poor are children. New analysis from the World Bank and UNICEF finds that almost 385 million children were living in extreme poverty in 2013. 8 out of 10 of those children lived in just 20 countries. Read more in "Ending Extreme Poverty: A Focus on Children

Chart: Fewer People Live in Extreme Poverty Than Ever Before

Tariq Khokhar's picture

In 2013, an estimated 767 million people were living under the international poverty line of US$1.90 a day. Even as the world's population has grown, the number of poor has gradually fallen. But in spite of this progress, with over 1 in 10 people considered poor, poverty remains unacceptably high. Read more in the new report on Poverty and Shared Prosperity

Time to think differently: How to help the internally displaced in Georgia

Ewa Sobczynska's picture
In the early 1990s and 2008, secessionist conflicts led to the internal displacement of 6 percent of Georgia’s population, making it one of the countries with highest incidences of internal displacement.
 
We tend to think that the displaced will be able to go home soon, but in reality, they remain displaced for years. A total of 246,974 men, women and children from the Georgian regions of Abkhazia and South Ossetia are still unable to return, now living in the capital city of Tbilisi and in smaller urban and rural areas close to their regions of origin.
 
Mother and baby
Mother and baby in Tbilisi. (Photo: World Bank)

After more than 25 years since the first wave of displacement, Georgia’s internally displaced are a diverse group. Some live in independent private housing, are employed and have managed to provide good education to their children. Others continue to live in collective centers, are spatially and socially isolated from the rest of the population, and have been chronically poor and unemployed since they became displaced.

While meeting the immediate needs of the displaced is important at the outset, such changes over time suggest that we need to think differently about how better to support them in the long term.
 
One example is the monthly benefit of 45 Lari (approximately 20 USD) provided to all internally displaced citizens by the Georgian government, regardless of their levels of poverty or employment. Some of the country’s poor, who have not been displaced, have begun to question this benefit.
 
After all, why should someone who is not poor, receive such support?
 
In 2014, the Government of Georgia asked the World Bank to study this question. Should the benefit for the internally displaced be adjusted, and what are the implications, including social and poverty impacts? Here are some of the main observations from the report, Transitioning from Status to Needs Based Assistance for IDPs: A Poverty and Social Impact Analysis, which our team prepared: 
  • Georgia’s displaced and non-displaced are equally likely to be poor. However, the displaced tend to rely on social transfers, remittances, and informal jobs, and are more likely to be unemployed for long periods of time. Those in rural area have significantly less information, opportunities for employment, or access to good quality education and services.
  • Those who still live in non-renovated, public collective centers experience inadequate living conditions. These households are often socially isolated, separated from friends and family and unable to form ties in uncertain housing conditions. Regardless of income, these households remain extremely vulnerable.
  • The displacement "status," – i.e., formal recognition of having been displaced from a conflict area – has a strong symbolic and political value among the entire Georgian population. To the displaced it signifies hope of returning to their homeland. To others it signals the state’s commitment to reintegrating the two occupied territories. For many – rich or poor – holding this status is a matter of dignity.
Research confirms the diverse economic and social situations of the displaced. It also recognizes the political difficulties of removing such a symbolically important benefit, or targeting it exclusively to the poor.
 
But given fiscal constraints in Georgia, providing benefits to those that do not necessarily need them is problematic in the long term. In this regard, the report supports the eventual phasing out of the benefit, already initiated by the Georgian government, while taking steps to help those in need, with the following recommendations: 
  • Livelihoods support is essential especially for households at risk of falling into poverty, with activities that are tailored to the diverse needs of this population, their skills and  location. Access to land for those in rural areas with agricultural skills, and access to finance and training for those who are entrepreneurial, are two activities that could work well with these groups.
  • Addressing housing conditions and supporting access to private housing is important. Currently, 80 percent of government assistance for the internally displaced goes for housing. These resources could gradually be reallocated towards livelihood assistance for the poorest. 
  • The poorest households, eligible for social assistance, should be encouraged to apply to the Targeted Social Assistance program – the regular social assistance program for vulnerable Georgians.

It is perhaps most important to ensure that the population, both displaced and not, understands why these reforms are necessary. The time has come for an adjusted approach, so that scarce resources can be used more effectively to benefit those in need, especially the poor and vulnerable.
 

What does it mean to “eradicate extreme poverty” and “halve national poverty” by 2030?

Umar Serajuddin's picture

This is part of a series of blogs focused on the Sustainable Development Goals and data from the 2016 Edition of World Development Indicators.

Sustainable Development Goal 1 is to “end poverty in all its forms everywhere” and has two specific poverty reduction targets. One target (SDG 1.1) talks of eradicating extreme poverty by 2030, building on a globally comparable notion of extreme poverty. Extreme poverty fell from 37 percent to 13 percent between 1990 and 2012; and based on national growth rates over the past 10 years, the global extreme poverty rate is estimated to be below 10 percent in 2015, a drop of more than two-thirds since 1990.

This post briefly explains how extreme poverty is measured and makes five main points:

  • A large number of people have moved out of poverty since 1990, and impressively, even though the world’s population grew by 2 billion, there are over a billion fewer poor people.
  • There are many countries with relatively low poverty rates that still have large numbers of the globally extreme poor living there (e.g. China, India).
  • At the same time, there are a large number of countries with stubbornly high poverty rates where relatively small numbers of the world’s extremely poor live (e.g Haiti, Uganda).
  • Since the SDGs focus on “no one left behind”, when looking at poverty across the world, both rates and numbers matter.
  • SDG target 1.2 aims to halve national poverty rates in all its dimensions between 2015 and 2030 – as it’s based on country-specific understanding of poverty (which often differ) it’s relevant for all countries, rich and poor alike.

Is it harder for children from poor families in rural China to attain education?

Yan Sun's picture
China has achieved unparalleled success in economic growth and poverty reduction since initiating market reform in 1978. But in recent decades, increasing inequality has become a central policy issue (Figure 1), and the goal of ‘harmonious development’ has become a focus of Chinese policy makers. It remains a challenge for China to share its prosperity more equitably.
 
Figure 1: Poverty and inequality in rural China

A fresh look at the global financial crisis and poverty trends in the EU

Doerte Doemeland's picture


When development practitioners such as ourselves think of poverty, the EU is not what comes to mind first. While it is true that average incomes are higher in Europe than in most regions of the world, it is also true that the 2008 global financial crisis had a huge impact on the welfare of the most vulnerable in many countries in the region.

“We love our daughters. But we need a son.”

Giorgia DeMarchi's picture

“We love our daughters. But we need a son.”

This refrain captures the common sentiment in Armenia, and is at the heart of the growing issue of sex imbalances in the country. Armenia today has one of the most imbalanced sex ratios at birth in the world, with 114 baby boys born for every 100 baby girls, above the natural rate of 105. We recently met with groups across Armenia to dig deeper into the root causes of sex preferences, with the hope of helping find an effective policy solution.
 
This issue has long affected countries like China, India and others in Asia, but it has emerged only recently in the South Caucasus. In Armenia, the ratio of boy births to girl births started increasing in the 1990s, when economic disruption and the desire to have smaller families, combined with the availability of sex detection technology, led many families to choose sex selection in the quest to have a son. The result? A generation of “missing girls,” as Amartya Sen first called this phenomenon.

Amid growing risks, will leaders protect the poor?

Sri Mulyani Indrawati's picture
© Ashraf Saad Allah AL-Saeed / World Bank


There is enough trouble out there to keep any policymaker up at night. Recent volatility has roiled Chinese and global stock markets, commodity prices have slumped, and security concerns are rising. All of this raises serious questions over the health of the global economy. This year could shape up to be risky, full of challenges and concerns for the fight against poverty.  
 
We ended 2015 with good news: For the first time in history, the number of extremely poor people dropped below 10% of the world’s population. The new Sustainable Development Goals and the Paris climate deal bring momentum to our effort to lift the remaining 700 million extremely poor people out of poverty while generating climate-smart economic growth.

On the road to middle class: A look back and a look ahead for Ghana

Vasco Molini's picture

 A look back and a look ahead for Ghana
 
I have vivid memories of my first trip to Ghana. It was in July 2006 and I was in the country to do a research on Ghanaian farmers. It was in Accra, where I watched my team, Italy, win the FIFA World Cup final against France. Other than being a lucky charm to me, I thought Accra was a nice and safe town but,I felt that it had the potential to grow.

When I came back seven years later, I was pleasantly surprised by the changes. The city was dotted with new buildings, new roads, and had a really buoyant atmosphere. Of course, Accra is not representative of the whole country, but according to a recent report that Pierella Paci and I presented in October, growth and poverty reduction have been widespread in the country. 
 
Now you may ask as to how Ghana was able to achieve this. In our report, Poverty Reduction in Ghana: Progress and Challenges, we show that sustained and inclusive growth in the last twenty years has allowed Ghana to more than halve its poverty rate, from 52.6% to 21.4% between 1991 and 2012.( Note: For comparing 1991 and 2012 poverty rates for both absolute and extreme poverty, the study used the 1999 poverty line. Official poverty rates use the new poverty line re-based in 2013.) The impact of rapid growth on poverty has been far stronger in Ghana than elsewhere in Sub-Saharan Africa. Indeed, until 2005 for every 1% increase in GDP in Ghana, the incidence of poverty fell by 2.5% — far above the Sub-Saharan average of 1.6%.


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