Information and stories about economy.

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Exploring the Economic Impact of Renewable Energy in Mali

Renewable Energy in Mali
Many citizens in Mali, a Sub-Saharan desert country in Africa with a population of almost 24.5 million, struggle to afford energy, and simmer in poverty. In 2022, poverty rates hit 19.1%, meaning almost 20% of their population makes less than $2.15 a day. With their growing impoverishment, their government has decided to take initiative and implement renewable energy in Mali. Not only does renewable energy create a cheaper alternative for those who cannot otherwise afford it, but it also creates jobs for those who need them. A staggering 52% of the population has access to electricity, less than 5%  have access to clean cooking, and as of 2023, the unemployment rate sits at 3.01%.

What is Renewable Energy?

In general terms, renewable energy is harnessed power that is derived from a continuously and naturally replenishable source, and is often a carbon-free source. Renewable energy sources include: 

  • Hydropower
  • Wind Power
  • Biomass
  • Solar Energy

All of these create a form of electricity.

Today, electricity greatly enhances people’s lives, which they use for everything from evening illumination to laundry, food preparation, factory operation and even things like international communication. It is essential for raising living standards, promoting economic growth and reducing poverty.

How Does Renewable Energy Affect Mali?

Currently in Mali, the average lifespan is only 59 years. On average, 97 newborns out of 1,000 pass away before they turn five. About 80% of Malians lack proper sanitation, and many do not have access to safe drinking water. The population is growing at a pace of 3.2% each year, and 47% of Malians are under the age of 15.

In 2006, Mali’s government implemented the National Energy Policy, which is supported by its five main objectives:

  • Improving access to energy
  • The rational use of existing energy sources
  • The efficient use of existing natural resources to produce energy
  • Sustainable use of biomass resources through the conservation and protection of forests
  • Strengthening government capacity and streamlining administrative procedures within the energy sector

These objectives aid in getting more electricity access across the continent, and also has the potential to create employment opportunities across the globe. According to the International Renewable Energy Agency (IRENA), transitioning to renewable energy in Mali is expected to “create 40 million additional jobs in the energy sector by 2050, with 18 million more jobs globally in renewables alone.”

Actions That Mali is Taking

Mali already has many jobs created for its citizens from these renewable energy projects. For example, in 2019, “ECREEE supported the Government of Mali in 2015 to develop a BOOT model tender for the development of grid-connected renewable energy projects.” From this BOOT (Build, Own, Operate, Transfer) model, a whopping 450 jobs emerged in Mali across the duration of the project.

The imminent arrival of these jobs can provide skills to allow workers to obtain future employment once it becomes available. However, in order for this initiative to work, there are several things being prioritized starting at early ages. With aid and funding from the U.S. Agency for International Development (USAID), the Education Development Center (EDC) has been able to provide a lot of help to the youthful Malians through the PAJE-Nièta— the Mali Out-of-School Youth project. These are the main pursuits of the project:

  • Give young people access to basic education, training in entrepreneurship and technical instruction in the service and agro-pastoral sectors
  • Teach volunteers to conduct business and basic education classes and to support program participants as they pursue entrepreneurship
  • Teach young people how to use Stepping Stone, an app that the EDC created, to access basic education lessons on mobile devices
  • Teach young people to start internal lending and savings organizations to support social and corporate loans
  • Boost the current youth associations’ organizational capabilities to oversee and carry out project operations

Looking Ahead

In order to produce employees for future jobs, once renewable energy projects reach completion, creating skilled workers from the inexperienced youth is key to furthering the continent’s progression. Renewable projects in Mali will likely develop the country’s economy, improving the conditions its citizens live in.

– Taylor Naquin

Taylor is based in Gilbert, AZ , USA and focuses on Global Health for The Borgen Project.

Photo: Flickr

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Poverty in Jamaica: The World Bank Renovates Kingston’s Waterfront

Poverty in jamaicaOn October 18, 2024, Jamaica’s government and the World Bank announced a $12 million investment to renovate Kingston’s Waterfront. The project aims to boost tourism, improve job accessibility and reduce poverty in Jamaica. This development is promising for Jamaica, where poverty in the area has made it challenging for many residents to sustain themselves.

The revitalized Waterfront has the potential to invigorate the local economy. Nigel Clarke, former Jamaica’s Minister of Finance and Public Service, commented: “This government is creating public spaces to serve the Jamaican people. This will revitalize downtown Kingston.”

The Timeline for Waterfront Renovations

Phases one and two of the Kingston Waterfront Improvement Project, known as KIWI, will run from 2024 to 2030. The project’s first phase will fund the creation of a multi-use park along Kingston’s waterfront. It will feature recreational amenities like bike paths, playgrounds, sports fields, street furniture and landscaped areas.

The second phase will “focus on the park’s construction, small-scale infrastructure works and urban upgrading.” The total amount that the budget covers for both phases is approximately $40 million. This large sum will work to reestablish Jamaica’s economy by its inherent benefit to the community. This could benefit around 700,000 Jamaicans by providing them with new job opportunities in the tourism sector, retail or small business booths in downtown Jamaica.

Kingston’s Waterfront Statistics and Employment Rate

In September 2022, Jamaica’s economic enrichment statistics from tourism indicate how urbanization of Kingston’s waterfront has the potential to further fortify its economy. Tourism keeps Jamaica involved in foreign commerce, building its independent value. Statistically, tourism in Jamaica directly employs 175,000 Jamaicans and indirectly employs around 354,000.

Professor Lloyd Webber highlighted tourism’s necessity in Jamaica by saying that consistent efforts must be made toward the Jamaican economy to maintain Jamaica’s status as a tourism hotspot. The Kingston Waterfront would do just that, building jobs, a more bustling economy and community cohesion, which would mitigate crime rates inherently.

Long-Term Jobs Create Long-Term Solutions for Islanders

While Jamaica is known as a bustling island nation, it faces significant socioeconomic challenges, including poverty and crime. According to the World Bank, approximately 17% of Jamaica’s population lives in poverty, with low-quality jobs leaving many Jamaicans vulnerable to economic shocks.

According to Graeme Young, “a Research Fellow at the University of Glasgow,” the lack of sustainable jobs makes it difficult for Jamaicans to afford nutritious food. Young argued that government policies fail to address the root issue: supply and demand. Young also highlighted Kingston’s primary challenges: low sales and insufficient customers.

Therefore, the renovation of Kingston’s Waterfront presents an opportunity to rebuild the economy, creating a vibrant, safe environment that benefits tourists and locals alike, whilst reducing poverty in Jamaica.

– Madeline Star Heintz

Madeline is based in Los Angeles, CA, USA and focuses on Business and Good News for The Borgen Project.

Photo: Pexels

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Poverty in Southeastern Turkey: A Brighter Future

A Brighter Future for the Southeastern Regions of TurkeyThe southeastern regions of Turkey face significant challenges as the poorest part of the country, struggling with underdevelopment and ethnic tensions. Recent developments, however, provide hope for a revitalized future in this historically rich area. The government plans to invest $14 billion in the region, a move aimed at reducing poverty and creating economic opportunities. Coupled with the normalization of relations with post-Assad Syria and Kurdish groups, this could transform the area and stimulate growth. This investment focuses on developing agricultural infrastructure to bolster the regional economy. Officials expect the initiative to create more than 500,000 jobs, offering a much-needed boost to local livelihoods.

Poverty in Southeastern Turkey and the GAP Project

Southeastern Anatolia ranks among Turkey’s regions with the lowest average income. Despite limited research on poverty in the region, existing studies indicate that conditions have seen little improvement since the early 2000s. The $14 billion investment aims to partially fund the Southeastern Anatolia Project (GAP) with the hopes it can continue its construction of needed infrastructure.

The GAP project was launched in the 70s as a region-wide investment project to provide the energy and water infrastructure to support an economic boom. However, throughout its history, the project continues to falter in its aims of revitalization. With renewed government support, the region now has a chance to attract further investment and drive sustainable development.

Insights from Mardin

The city of Mardin illustrates many of the challenges facing southeastern Turkey. This ancient city, which dates back to the Neo-Assyrian period, highlights the region’s rich history and its socioeconomic struggles. Mardin suffers from one of the country’s highest relative at-risk-of-poverty rates at 14.4%.

In 2021, Dr. Nurdan Atalay conducted ethnographic research in Mardin, revealing how top-down financialization and investment strategies exacerbate economic inequality and limit employment opportunities for women. In her book chapter, she noted, “…the women in this neighborhood have very limited opportunities to change their position in society… The impending economic crisis has the potential to worsen their situation.”

Mardin also accommodates a large population of refugees who fled Syria’s civil war and the 2023 earthquakes. More than 88,000 Syrian refugees live in the city, contending with the trauma of displacement and the strain on local resources. Reports detail the economic burden that border cities faced during the Syrian conflict. With the end of Assad’s rule, many refugees now look toward a hopeful future and the possibility of returning home.

The Potential of Tourism

Neighboring political progress isn’t the only cause for optimism in southeastern Turkey. The tourism industry holds immense potential to reduce poverty in the region. This area, rich in historical monuments and natural beauty, stands poised for economic growth if supported by infrastructure and investment.

The 1982 Tourism Incentives Act excluded southeastern Turkey, denying the region the development needed for a thriving tourism sector. Despite this, cities like Mardin actively seek to expand their tourism potential. Research indicates that Mardin’s residents support tourism growth, which promises to benefit both urban and rural communities.

In 2023, Mardin welcomed nearly 650,000 tourists, reflecting the industry’s growing role in the local economy. By fostering tourism, southeastern Turkey can unlock new opportunities for sustainable development and cultural preservation.

A New Chapter for Southeastern Turkey

With the government’s $14 billion investment and the prospect of peace in Syria, poverty in southeastern Turkey faces a turning point. The region’s lack of infrastructure has long created a cycle of poverty and underdevelopment. This new funding and strategic focus could break that cycle, paving the way for meaningful progress and prosperity.

– Charley Dennis

Charley is based in London, UK and focuses on Good News for The Borgen Project.

Photo: Flickr

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The Intersection of Disability and Poverty in Portugal

Disability and Poverty in PortugalIn Portugal, the intersection of disability and poverty is a pressing issue. Despite progress in disability rights and social support, many individuals with disabilities continue to face economic hardships. This challenge is not only about physical impairments but also the systemic barriers that contribute to persistent poverty.

The Reality of Disability in Portugal

Portugal has implemented laws like the “Basic Law on the Rights of Persons with Disabilities” (Law 38/2004). This legislation underscores the country’s commitment to protecting the rights of individuals with disabilities and fostering their active participation in society.However, the reality for many individuals with disabilities remains one of exclusion, especially in rural areas where services and infrastructure are limited.

Challenges are exacerbated by geographical isolation and a lack of targeted support, leaving many unable to benefit from these legal advancements fully. According to a report, more than 10% of Portugal’s population lives with a disability. Yet, many still struggle to access education, employment and health care. This persistent inaccessibility not only hinders personal development but also perpetuates a cycle of economic disadvantage, marginalization and social exclusion.

Disability and Economic Struggles

A key factor in the poverty faced by persons with disabilities is the lack of accessible employment opportunities. According to data from EU-SILC, the employment rate for people with disabilities in Portugal is about 58.4% compared to 77.4% for people without disabilities. Discrimination and inadequate workplace accommodations often hinder job prospects. Furthermore, the lack of accessible transport and facilities adds to the difficulty. Moreover, public services, including health care and transportation, can be inaccessible in many parts of the country.

Portugal lacks a national personal assistance scheme, leaving many individuals with disabilities reliant on family members or institutional care. This makes many of them report difficulty in accessing public transportation, especially in rural and less-developed regions. This lack of access further isolates individuals living with disabilities from society, making it even harder to engage in education, employment or social life.

Moving Toward Inclusion

Breaking the cycle of disability and poverty in Portugal requires a comprehensive approach that includes greater investment in inclusive education, better access to public spaces and increased employment opportunities for people with disabilities. The Convention on the Rights of Persons with Disabilities (CRPD) emphasizes that people with disabilities should have the right to choose where and with whom they live, free from mandatory institutionalization.

Integrating individuals with disabilities into the workforce holds immense potential for economic growth. This is a benefit acknowledged by the Portuguese government as part of its commitment to inclusivity under the 2030 Agenda for Sustainable Development. The success of these top-down-oriented strategies is crucial, not only for Portugal but for Europe as a whole, in addressing and reducing poverty effectively via political and administrative change.

– Lambros Andrikopoulos

Lambros is based in Birmingham, UK and focuses on Global Health for The Borgen Project.

Photo: Pexels

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Hunger in Guinea-Bissau

Hunger in Guinea-BissauGuinea-Bissau is a small West African country on the Atlantic Ocean coast, with a population of approximately 2 million. Despite its abundant natural resources, Guinea-Bissau faces significant challenges. Years of political instability and other factors have led to increased hunger and poverty in Guinea-Bissau. 

Facts and Figures

  1. In 2023, GDP grew by 0.1%, reaching an overall growth rate of 4.3%.
  2. The poverty rate, defined as living on $3.65 a day, has worsened and now stands at 65% in the country. 
  3. According to the Global Hunger Index, Guinea-Bissau ranks 114th out of 127 countries facing a severe hunger crisis. 
  4. The prevalence of undernourishment in the population has increased over the past decade, rising from 34.8% to 37.9%. 
  5. The percentage of children under 5 suffering from stunting has grown from 26.4% in 2012 to 27.7% in 2019 and 72 out of 1000 die before their fifth birthdays. 
  6. Guinea-Bissau is one of the five countries with the highest maternal mortality rate, which is 725 per 100,000 live births.

Underlying Issues

  • Political: Guinea-Bissau gained independence in 1974 but faced challenges such as military coups, political unrest and weak governance. Additionally, widespread drug smuggling has worsened corruption and undermined the government. These issues significantly contribute to the country’s weak economy, hunger and poverty.
  • Weak infrastructure: The country has underdeveloped infrastructure, including poorly maintained roads, limited electricity supply and inadequate health care facilities. Weak governments and corruption have further hindered infrastructure development.
  • Over-dependence: Guinea-Bissau relies almost entirely on cashew nuts for its export revenues, which account for 95% of its total exports. This heavy dependence makes the economy highly vulnerable to price fluctuations. Additionally, the lack of diversification in agriculture and exports worsens issues such as poverty, food insecurity and hunger in Guinea-Bissau.
  • Extreme weather: Guinea-Bissau is among the top five countries most affected by extreme weather, experiencing problems such as rising sea levels, erratic rainfall, prolonged droughts and flooding. These environmental issues have negatively impacted biodiversity, fishing and agriculture. As a result, the country is facing rising poverty levels, increased food insecurity and heightened hunger. 

Development Programs

International organizations are working with the government to reduce poverty and hunger in the country.

  • Food security- The WFP provides cash assistance to families needing immediate support and school meals to prevent malnutrition and stunting in children. UNICEF and the World Bank have partnered to launch a Scale Up Nutrition program. The initiative targets reducing stunting and malnutrition while improving maternal and child health.
  • Agriculture Development- Organizations like the Food and Agriculture Organization and the World Food Program assist farmers by supplying seeds, fertilizers and training. The FAO is also collaborating with the government to develop drought-resistant crops. The aim is to build resilience and mitigate impending climate impacts.

Towards A Sustainable Future

Guinea-Bissau faces daunting challenges, including high poverty rates, food insecurity and the impacts of political instability and weather events. However, through collaborative efforts between the government and international organizations and a focus on sustainable development, agricultural resilience and the promotion of food security, Guinea-Bissau can work towards a future where all citizens have access to basic needs and opportunities. Continued commitment and investment from the international community in these areas will be crucial to breaking the cycle of poverty and hunger in Guinea-Bissau. 

– Maria Waleed

Maria is based in Yokohama, Kanagawa, Japan and focuses on Good News and Global Health for The Borgen Project.

Photo: Wikimedia Commons

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Microfinance in Egypt: A Tool to Ease Poverty

Microfinance in EgyptMicrofinance in Egypt has been used to promote financial inclusion and empower low-income individuals, particularly women. It does so by providing them with access to small loans and financial services, allowing them to satisfy their household’s needs independently. This has been supported by both government initiatives and NGOs, helping to stimulate entrepreneurship and improve livelihoods in impoverished communities in Egypt.

The Aim of Microfinance Loans

Among other things, microfinance in Egypt aims to extend loans and other financial services to women who need more collateral to access traditional banking services. The microfinance institution covers around 82% of Egyptian poor and low-income households. It not only empowers entrepreneurs and small businesses but stimulates local economies by promoting self-sufficiency and reducing poverty.

Crucially, microfinance loans have a positive effect on the household incomes of women borrowers. While women make up nearly half of Egypt’s population, they make up less than a quarter of the country’s total labour force, many of whom work in the informal sector. As a result of working for the informal sector, women often cannot access financial services, which is an issue that the use of microfinance loans could tackle.

Prioritizing Financial Inclusion

As part of Egypt’s Vision 2030, the national Egyptian government seeks to prioritize women’s financial inclusion and economic empowerment. Already, the Central Bank has begun initiatives to allow female owners of micro, small and medium enterprises (MSMEs) to be part of the formal financial system, according to the Economist Impact. This is important as the Central Bank’s policies indirectly impact the microlending system where its initiatives to enhance digital financial services and financial inclusion can heighten access to microloans for impoverished communities.

The International Monetary Fund (IMF) calculates that increasing the female labor force participation rate to the male level and increasing employment opportunities could increase Egypt’s GDP by 34%, the Economist Impact reports.

Further Developments

Additionally, to support the government’s efforts, HSBC Bank Egypt and Reefy Microfinance Enterprise Services signed a deal earlier this year to provide 150 million Egyptian pounds to micro businesses in Egypt, with one-third of that figure going towards female-led enterprises. On top of this, HSBC has pledged it will provide between $750 billion and $1 trillion dollars by 2030, to support sustainable financing, the Economist Impact reports.

Despite the significant improvements for some, a large number of old clients who have not seen an improvement in household income following the scheme, remain.

Moreover, there are operational risks such as fraud prevention and technology dependency. The risks of fraud are high considering the digital nature of many interactions whereby the implementation of robust fraud detection systems is crucial. Moreover, technology dependency appears to be another operational risk as “the increasing reliance on technology for loan disbursement and collection processes creates risks related to cybersecurity and system reliability,” according to Andersen. Other potential issues include market saturation or funding and liquidity management. Market saturation means that many “entities are competing for the same customer base,” a current example being Valu.

Overall, microfinance in Egypt offers a promising future for financial inclusion and economic empowerment, bar the potential for certain risks. By providing access to small loans and financial services, Microfinance enables individuals to meet their household needs, stimulate entrepreneurship and enhance livelihoods in underprivileged communities. The support from both government initiatives and NGOs has been extremely helpful in facilitating this process, aligning with Egypt’s Vision 2030.

– Amani Almasri

Amani is based in Durham, UK and focuses on Good News and Technology for The Borgen Project.

Photo: Unsplash

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The Recent Poverty Spike in Argentina

poverty in argentinaBetween 2021 and 2022, it was fair to say that poverty in Argentina was heading towards a positive reform. Of course, it is important to consider the effect that the COVID-19 pandemic will have on reducing poverty numbers, but in 2021 poverty in Argentina sat at 11.4%, a 4% decrease from 2020, and in 2022 it decreased even further to sit at 10.9%.

Poverty Spike in Argentina

Argentina is now grappling with an alarming surge in poverty, which has risen to levels not seen in over 20 years. As of mid-2024, more than 50% of the population is living below the poverty line, with 27 million people affected. The poverty spike in Argentina correlates to current economic instabilities. President Javier Milei has established particular austerity measures recently, primarily implementing a significant reduction in spending, that exists as a major factor in the South American nation’s monetary issues.

Milei, a staunch libertarian, came into power in late 2023 and proposed methods aimed at stabilizing an otherwise fluctuating economy. He focuses on three main areas: cutting funding to social assistance programs; layoffs in the public sector and freezing public investment. In the end; however, each inadvertently ended up doing more bad than good. For example, the government’s layoffs in the public sector have led to thousands losing their jobs, thus exacerbating unemployment, according to The Guardian.

Inflation and Purchasing Power

A spike in poverty like this is often the result of years of build-up, and for Argentina, it can be seen through its long-lasting fight with inflation. Annual inflation in Argentina sits at one of the highest on the globe at over 230%, The Guardian reports.

Such rampant inflation has drastically eroded purchasing power, leaving necessities like food out of reach for many. The cost of staple goods has soared, making daily survival a challenge for millions. A further damning scenario occurred in May 2024, with subway fares in Buenos Aires tripling, rising from 125 pesos (14 cents) to 574 pesos (64 cents).

Unsurprisingly, all of the recent living difficulties have been met with protests in response. In June 2024, anti-government protestors clashed with police forces in Buenos Aires in retaliation to the Argentine Senate passing Milei’s reforms. In spite of all this, Milei’s government has defended the situation, deferring away from the negative effects of his policies, instead “celebrat[ing] the fact that his administration had managed to lower spending to a level below tax income for the first time since 2008.”

NGOs Helping

There are efforts underway, working to address the challenging circumstances in Argentina, with several organizations actively working to alleviate the impacts of poverty and inflation. NGOs are playing a key role in supporting vulnerable populations by providing essential resources and services. For instance, organizations like the Red Cross are distributing food, offering shelter and facilitating access to health care.

Additionally, programs such as Project Noemi focus on promoting job training and small business development are helping individuals gain economic stability, contributing to longer-term solutions for affected communities.

Overall, the surge in poverty in Argentina is a stark reminder of the fragile balance between economic reforms and social equity. While the Milei administration’s austerity measures may have been established with positive intentions, aimed at stabilizing Argentina’s finances, their immediate impact has plunged millions into hardship. Navigating a path out of this crisis will require not only bold economic decisions but also a commitment to social justice and inclusion.

– Joe Lockett

Joe is based in the Wirral, UK and focuses on Business and Politics for The Borgen Project.

Photo: Unsplash

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Strengthening Education in Brazil

Strengthening the Education System in BrazilBrazil, South America’s largest country with a population of 216.4 million, shows mixed results in education. Student performance declined in the latest Programme for International Student Assessment (PISA), conducted by the Organization for Economic Cooperation and Development (OECD). Despite this, illiteracy rates dropped from 6.1% in 2019 to 5.6% in 2022, indicating some improvement in basic education. The country is experiencing increased outbound student mobility, driven by rising tertiary enrollments. Projections suggest Brazil will rank among the top five nations globally for total tertiary enrollments by 2035 despite an aging population. To address these ongoing challenges, the OECD and other organizations are collaborating to enhance Brazil’s education system.

Brazil’s Education System and Socioeconomic Progress

Education in Brazil is a guaranteed social right under the Federal Constitution, providing free public access at all levels. The education system is divided into basic and higher education. Basic education encompasses early childhood, primary and lower secondary and upper secondary education. Compulsory education begins at age 4 with pre-school and continues for 14 years through the end of upper secondary education. Historically, Brazil’s economic growth has benefited from favorable demographics and robust commodity prices. This growth, coupled with specific policies, has significantly improved living standards. Between 2003 and 2014, these efforts lifted more than 29 million people out of poverty, reduced child mortality by 73% from 1990 to 2011 and broadened access to basic education.

OECD’s 5 Steps to Strengthen Brazil’s Education System

  1. Impact of COVID-19 on Brazil’s Educational Funding. COVID-19 significantly affected Brazil’s economy, resulting in reduced education spending. The OECD criticizes the rigidity of this funding, which merely satisfies spending requirements without addressing effectiveness. The organization recommends a more flexible, outcome-focused approach to funding. According to the OECD, increased investment in education would substantially improve the quality of education that students receive.
  2. Enhancing the Teaching Profession in Brazil. To enhance Brazil’s education system, the OECD recommends upgrading the teaching profession. This upgrade should include better salaries, career progression and working conditions for teachers. The organization also suggests that new teachers pass a licensing test and receive induction support during their early years to ensure they have adequate training.
  3. Improving Teacher Effectiveness and Student Outcomes. Boosting student outcomes involves enhancing teachers’ effectiveness in the classroom. This could include proper teacher training and skill improvements in areas such as classroom management. Providing incentives, such as promotions and performance-based payments, can also motivate teachers.
  4. Creating a Positive School Environment. There is a need for improvement in handling bullying and harassment on school grounds, with appropriate punishments for offenders. Schools should strive to create a positive environment for both students and teachers to improve well-being and learning outcomes, reducing the risk of dropouts.
  5. Supporting Disadvantaged Students and Preventing Dropouts. Disadvantaged students should receive continuous support from early childhood education until they complete their education. To address dropouts, teachers should focus on supporting the weakest and least motivated students, possibly through individual teaching and tutoring. Students at risk should also receive additional funding and support to remain in education.

Looking Ahead

Brazil’s commitment to advancing its education system reflects the country’s efforts to prepare for future socioeconomic challenges. Prioritizing innovation, equity and effective resource allocation can potentially address long-standing disparities in education. By fostering collaborative partnerships and emphasizing strategic improvements in education, Brazil aims to create opportunities for all students, supporting both national development and individual growth.

– Indira Smith

Indira is based in Manchester and focuses on Global Health for The Borgen Project.

Photo: Flickr

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Poverty Reduction in Vietnam: Economic Growth and Challenges

Poverty Reduction in VietnamOver the last three decades, poverty reduction in Vietnam has experienced unprecedented success. The Doi Moi Reforms in 1986 have been a success story in what was once one of the poorest nations. This progress continues today. With the average distance of the poverty line shrinking, upward mobility is widespread and welfare programs and public investment continue to improve lives. Despite these successes, there are remaining challenges. There are still many people living in transient poverty, and some areas of multi-dimensional poverty require solutions. For instance, gender equality, ethnic, minorities and rural communities bear the brunt of Vietnam’s current challenges.

Economic Growth

Poverty reduction in Vietnam is largely attributed to the reforms of the 1980s. Key Changes were incentives to diversify agrarian production, opening trade to the global market and domestic investment which contributed to exports and job creation in urban areas, according to the UNDP report. The income these policies generated drove the improvement of domestic services and improved quality of living.

The 2022 World Bank report found that the Low and Middle low-income country poverty rate dropped from 16.8% to 5% in 2010-2020. In the same decade, the size of the middle class has tripled from 7.3 million people in 2010 to 22.6 million people in 2020. Health outcomes have also improved. Vietnam’s universal health index is higher than global averages at 73, and infant mortality rates fell from 32.6 per 100 births in 1993 to 16 in 2022.

In 2015, the government implemented a National Target Program to reduce deprivation in some remote rural areas and regions where incomes have not risen as fast as in other areas. They are continuing to develop them into 2025, according to the UNDP report. These programs include the New Rural Development program, which aims to improve critical services for rural communities, such as education, health, transport, water supply, security, communication and more.

The impact of Foreign direct investment (FDI) should not be ignored either. After joining the World Trade Organization in 2007, formal jobs with foreign-owned enterprises opened up in the manufacturing sector. There were 2 million more manufacturing jobs in 2020 than in 2018, and 1.9 million had formal work contracts. Showing a link between FDI and an increasing number of jobs with higher wages, according to the World Bank report.

Addressing Inequality and Ethnic Minorities

These are encouraging trends and the economic achievements are monumental. However, poverty is dynamic, and despite these successes, most households are still vulnerable to transient poverty. For the majority, their households can be driven below the poverty line by a sudden change in their conditions. Sixty percent of households are vulnerable to income poverty, especially in rural regions. For instance, during the COVID-19 Pandemic, 73.3% of Vietnamese lost income, UNDP reports.

Children without access to technology suffered the most significant learning losses during lockdowns. The poorest regions of Vietnam, which are usually remote and mountainous, are disproportionately home to ethnic minorities. While ethnic minorities represented 6%-13% of Vietnam’s population in 2020, they accounted for 21%-42% of the nation’s poor, according to the World Bank report. These disparities indicate that ethnic minorities benefit the least from Vietnam’s poverty reduction efforts and are most vulnerable to conditions of poverty.

The government has focused on tailored plans to support ethnic minorities with central funding through National Targeted Programs (NTPs) to test innovation on a local level. The 4M initiative, (meet-match-mentor-move) aims to enable ethnic minority women to break their isolation by introducing them to non-agricultural markets like e-commerce, social media and multi-stakeholder networks, UNDP reports. Knowing production and business methods, these women have expanded their markets and enterprises, benefiting around 13,000 women.

NTPs can support interaction among government bodies and communication between government agencies and local authorities to test new solutions to poverty reduction in remote areas. For instance, incorporating digital technologies at a grassroots level, as they did with the 4M initiative and digitizing poverty reduction services targeting remote communities to reduce administrative costs and service time.

Steps Going Forward

According to a survey of the NTP-National Rural Development, much of NTP spending was on socio-economic infrastructure, but targeted household programs may lift the remaining poor above the poverty line. The concentration of poverty among ethnic minorities in rural areas also calls for NTPs which target these communities directly, ensuring access to resources, investment and digitization.

While challenges remain, particularly for ethnic minorities and vulnerable communities facing climate risks, Vietnam’s commitment to poverty reduction offers hope for continued progress. Poverty reduction in Vietnam is one of the three NTPs in 2021-2025. By adjusting the multidimensional poverty line, 10 million more people are eligible for government social assistance. Aim for a 1.5% annual reduction in MDP International cooperation and an adaptive approach to policy will be essential to ensure that Vietnam can continue its journey toward a more equitable and sustainable future.

– Jonathan King

Jonathan is based in London, UK and focuses on Global Health and Politics for The Borgen Project.

Photo: Pexels

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Green Jobs and Economic Growth in Low-Income Countries

Economic Growth in Low-Income CountriesA green economy could be defined by three characteristics: low-carbon, socially inclusive and resource-efficient. Focusing on renewable energy, sustainable agricultural practices and opening new horizons for eco-friendly industries, the green economy holds the potential to serve as a powerful tool for boosting economic growth in low-income countries. Using investments as a focal point, green economies target renewable energy such as solar power, wind power and hydrogen to grow employment and income as well as prevent loss of biodiversity. By integrating environmentally sustainable practices into these key sectors, nations that adopt a green economy could create jobs and mitigate long-term poverty.

Green Jobs as a Catalyst for Economic Opportunity

In many low-income countries, poverty as a result of unemployment is a widespread issue, particularly in rural areas. In this case, the green economy presents itself as an occasion to diversify job markets and offer employment opportunities in areas that have not yet been brought to mainstream industries. By expanding into sectors such as renewable energy, sustainable agriculture and waste management, green jobs create a stronger bond with the social sphere of communities instead of just an environment-based one.

The renewable energy sector alone could offer significant job creation potential as the installation, operation and maintenance of solar power systems, wind turbines and hydroelectric systems require skilled workers in both urban and rural communities. These jobs could provide stable income and improve the lives of many by reducing dependency on costly alternatives such as imported fossil fuel-based energy and thus, increasing energy affordability on a larger scale. In the past decade, employment in renewable energy has nearly doubled, reaching a whopping 13.7 million in 2022, an increase from a total of 7.3 million in 2012.

Sustainable Agriculture

For many low-income economies, agriculture is the backbone of society. Smallholder farmers produce at least one-third of the world’s food, yet many of them continue to face poverty due to escalating issues such as outdated farming practices, environmental degradation and poor yields. In Rwanda, projects such as Land Husbandry, Water Harvesting and Hillside Irrigation (LWH) have positively contributed to a wider socioeconomic understanding of the need for agroforestry projects. The LWH has improved crop yields and land degradation, leading to an increase in incomes for smallholder farmers. This has also significantly alleviated poverty concerns as well as strengthened food security in local areas.

Thus, for the agriculture sector, green jobs can provide solutions to these issues by creating and encouraging sustainable farming methods that raise productivity and prevent environmental degradation. Investing time and effort into methods such as organic farming, agroforestry and soil conservation as well as into training smallholder farmers the value of these practices is a step towards improving long-term land fertility and crop yields.

Boosting Local Economies

Increasing interest in eco-friendly industries offers another opportunity to reduce poverty in low-income countries as these industries focus on sustainable manufacturing and construction. Activities such as these are labor-intensive and difficult to outsource, meaning they create local job opportunities.

With the right training, green industries require a diverse range of skills that workers—from technicians and engineers to managers and urban planners—can develop to adapt to the demand for environmentally responsible products. An example of this is the World Bank’s Energy Efficiency Improvement in Commercial and Industrial Sectors (VEEIE) project based in Vietnam. This project works towards helping local factories to adopt energy-efficient technologies to reduce costs and increase productivity. This project contributes to the creation of green jobs that have employed local workers to carry out installation and maintenance-related services in this industry.

Economic Growth in Low-Income Countries

Green jobs have already shown considerable success in addressing unemployment-driven poverty. In Kenya, for example, solar energy projects such as the Green Mini-Grid Program have successfully used incoming investments to create jobs in rural areas. By employing local workers who are in charge of installing, operating and carrying out maintenance for the solar energy products, this initiative provides affordable access to energy as well as employment opportunities for those in need.

Green jobs have the potential to significantly contribute to economic growth in low-income countries by providing a wider range of economic opportunities at the local level. Sectors such as renewable energy, sustainable agriculture and eco-friendly industries hold the potential to contribute to long-term economic growth, job creation and providing relief for those that live under poverty. With the appropriate policies, training programs and investment in the green economy, low-income countries can stimulate local economies and play a central role in economic well-being, environmental preservation and poverty reduction.

– Mashal Aman

Mashal is based in Kyoto, Japan and focuses on Business and Technology for The Borgen Project.

Photo: Flickr