Archive for category: Economy

Information and stories about economy.

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How Communal Living Benefits the Rural Poor in India

How Communal Living Benefits the Rural Poor in IndiaA single woman, a resident of Kambam near the Tamil Nadu-Kerala border, spoke about her family and friends organizing fundraisers. The funds went into assembling more than 1,000 grocery bags for low-income families living in the town. It is quite common for local communities in different parts of the nation to look after the rural poor in India.

India, while known for its overpopulated cities, is also prominently known for its vast rural landscape. Numerous small towns and villages where community living is the backbone still continue to exist. Kambam is one such town. On speaking to more locals in the region, there seemed to be several unofficial and low-key groups. These groups consistently reached out to the needy living in their area.

The Rural Poor in India

According to a recent SBI Research report, rural poverty has recorded a significant reduction. The report stated that in FY24, rural poverty accounted for about 4.86%, falling from 25% in 2011-12. This represents a notable reduction in rural poverty.

Taking a broader view of impoverished people in rural areas of the country brings several aspects to light. Similar to their surroundings, they more often tend to live as groups rather than individuals.

Secondly, experts state that there exists a notable disparity between homelessness in rural and urban areas. A recent census shows that 52% of India’s homeless live in urban areas, while 47% live in rural regions. Most of this population, however, lives in very inadequate and substandard housing situations. Nevertheless, studies show that they are less likely to be stranded on the streets like their urban counterparts.

On the other hand, access to health care and other basic facilities is often more difficult to reach in rural areas in India. These individuals, particularly those residing in remote parts, also face difficulties claiming the benefits of governmental schemes that can aid them in improving their lifestyles.

The Impact of Communal Living on the Rural Poor

India, similar to other Asian countries, exhibits a community-based lifestyle. This cultural approach has positive effects on people living below the poverty line. As mentioned earlier, casual conversations with locals in South India indicated the existence of several community outreach groups. 

One group of young women hosts a cooking-based group. Members gather for a day of cooking, chatting and working together. They cook large meals, pack them and distribute them to areas where low-income residents live. These women report a sense of fulfillment through such outreach activities and say it provides a break from their routine. 

Within the Muslim community in Kambam, following the rule of obligatory charity (“Zakath”), residents contribute regularly. Volunteers collect these funds and use them to help people who require health care assistance. This support can also extend to education and livelihood assistance.

These observations highlight the outcomes of communal living for people experiencing poverty. Studies also suggest that people living in rural India often approach the poor as members of their community.

As a result, individuals may help those who do not have access to basic life needs. For instance, it is common for a rural shopkeeper to give excess vegetables to a struggling person in the neighborhood.

Communities and Government Programs

In the last few decades, rural poverty has notably reduced. Several factors have contributed to this. While communal living and similar practices often provide short-term assistance, government schemes have focused on long-term solutions.

The central government’s housing schemes have contributed to reductions in homelessness. A research paper observes the difference between 2001 and 2011, showing a 28% decline in homelessness between the two decades.

In February 2025, the central government announced a new set of schemes focused on empowering rural communities. These initiatives aim to increase housing, employment, infrastructure and poverty alleviation efforts in rural areas.

Apart from governmental schemes and NGOs, projects often partner with local communities to enhance outreach and productivity. One such project was PURA (Providing Urban Amenities to Rural Areas). This large program began in 2001, with former President A. P. J. Abdul Kalam playing an integral role.

The project involved governments working with businesses and local communities to implement long-term solutions in rural areas. Although there were challenges, private-sector PURA initiatives reported more effective results. These outcomes ranged across housing, transport, education and employment.

Urban Versus Rural Poverty in India

Multiple studies suggest that rural poverty reduction in India has occurred at higher rates than urban poverty. One report stated that of the 22% of people experiencing poverty in India, nearly 25% live in urban areas. When considering that 70% of the nation’s population lives in rural areas, this suggests a higher concentration of poverty in urban settings. Additionally, homelessness shows higher rates in urban compared with rural India. While multiple factors contribute to this difference, lifestyle may be one factor. Urban environments often involve more individualistic living conditions compared with rural communities.

Looking Ahead

Global poverty can take many forms and requires diverse responses. Rural poverty in India highlights the need for strategies that combine government initiatives with community participation. In recent decades, government programs and community-based efforts have contributed to reducing poverty in rural areas. These approaches continue to support rural communities by improving access to services and economic opportunities.

– Shafika Fathima

Shafika is based in Chennai, Tamilnadu, India and focuses on Good News and Global Health for The Borgen Project.

Photo: Flickr

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Spark Microgrants: Building Durable Livelihoods in Africa

spark micrograntSpark Microgrants is an organization working in Africa that provides cash grants and development support to small villages in order to encourage long-term economic growth. Through its two key pillars, durable livelihoods and collective agency, Spark Microgrants has helped more than 1,300 villages develop durable livelihoods in Africa. What started as a small initiative in Rwanda in 2010 has now reached more than 1 million people in Rwanda, Malawi, Uganda, Ghana, and Burundi.

The Three-Phase Method

Spark Microgrant’s method is particular, as it wants to avoid imposing its practices and ideas on the citizens of the villages, so it adopted a village-driven process. This means that the organization puts the decision-making for the projects in the hands of those who will be using it, allowing them to build on pre-existing indigenous practices.

In fact, the first phase of the development project requires the village to identify its local assets, so that the economic growth that follows stems from pre-existing resources and not external, unsustainable support. Then, through six months of village planning meetings open to all village members, they must develop a vision or plan for how to utilise these resources in their favour, and then must decide on a method through which to achieve this vision. Opening these meetings to the entire village is an essential component of this phase, as it shifts the power in the village from a small group of male elites to women and men of all ages and socio-economic status.

For the second phase of development, the village receives the first half of its microgrant to invest in its chosen project. Not only does this allow them to test the success of their chosen project before they receive the second half, but it also allows the village to begin a savings program. Both of these are crucial to the success of the program because they ensure that the village can become self-reliant and will be able to prosper long after Spark Microgrants stops supporting them.

For the final phase, Spark Microgrant monitors the success of the program for two years to ensure that the chosen investments are prosperous. Additionally, they ensure that the benefits of the program are experienced by all members of the village, allowing all members to emerge from extreme poverty and stay out of it for the foreseeable future.

Current Impact

In the last 15 years, Spark Microgrants has had immense success in building durable livelihoods in Africa. By partnering with other local organizations, it has been able to expand its expertise of the region’s indigenous practices and widen its impact. It uses its two key pillars to quantify its success thus far. For “collective agency,” it tracks growth in citizen engagement in the project, specifically in village meetings. This is invaluable to the program, as it fosters a deep trust in the collective action of the village. In fact, they have seen a 215% increase in women’s civic engagement, proving that the open village meetings have succeeded in encouraging all village members to participate, creating more diverse governing bodies.

For the second pillar of “durable livelihoods,” Spark Microgrants tracks economic factors such as growth in assets, savings, and food security. It reports a 249% increase in median household asset values in the villages they have worked with as well as an 160% increase in household savings. Whilst this data clearly demonstrates the charity’s success, the most impressive … is that each village has seemed to use its revenues and success to launch its own similar programs in other villages. This is significant because it creates an impact multiplier, essentially doubling Spark’s impact for every village it works with.

Spark Microgrant’s efforts in building durable livelihoods in Africa are not only immense in results and statistics, but they also encourage self-reliance and sustainable long-term impact. Its flexible systems allow its models to be adaptable and unique to each village, creating lasting change and breaking generational poverty.

– Vittoria Cortese

Vittoria is based in Washington DC, USA and focuses on Good News for The Borgen Project.

Photo: Flickr

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A Race for Economic Stability at the Bahrain Grand Prix

Bahrain Grand PrixWhen the lights go out at the Bahrain Grand Prix, the world watches. Billions of global viewers tune in, and Formula 1 has transformed Bahrain into more than just a recognizable name in international sport. Beyond the roar of engines and celebrity spotlights, however, the Grand Prix has delivered more than media attention; it has strengthened the country’s economic stability. Since hosting its first race in 2004, Bahrain has generated an estimated $1.3 billion in economic impact from the Grand Prix.

During its first decade, a single race weekend generates hundreds of millions of dollars in tourism revenue, filling hotels, restaurants and transport services. Each year, race week creates around 3,000 jobs across sectors such as hospitality, logistics and event management.

This is alongside permanent positions in logistics, catering and circuit management. For a country of 1.4 million people, whose dependency is on volatile oil revenues, these numbers matter to ensure a future of economic stability. 

A Balanced Perspective

Despite this macroeconomic growth, poverty remains a pressing issue. According to ESCWA, one in 13 Bahrainis (7.5%) live below the poverty line or approximately 54,000 citizens. The spending of the poorest 10% of families is 10 times lower than that of the richest 10%.

These figures also highlight deep inequality. However, Formula 1’s arrival has delivered tangible, though often short-term, solutions. One of the country’s most lucrative sporting and entertainment events now serves as a strategic tool in Bahrain’s poverty-reduction efforts. The Bahrain International Circuit has driven development in Sakhir, attracting new hotels, entertainment venues and real estate investment. These projects create employment beyond race week and help diversify the economy away from oil dependence.

However, important caveats remain. To ensure that global events like Formula 1 translate economic gains into inclusive growth, policymakers must link revenues directly to community programs, invest in workforce training and create targeted employment pathways for vulnerable job seekers.

Across the world, governments increasingly pair sporting mega-events with community development frameworks. Bahrain, with its global visibility and financial inflows, holds the platform to do the same. Before COVID-19, global extreme poverty fell below 10%, down from more than 35% in 1990. Although recent crises reversed some of those gains, history shows that sustained and intentional policy choices can drive real progress.

Looking Ahead

Bahrain’s story reflects a broader truth: economic branding alone does not eliminate poverty, but economic growth paired with inclusive financial strategies can drive meaningful change.

With sustained investment in fair employment expansion and responsible global partnerships, Bahrain can turn Formula 1’s global spotlight into long-term opportunity. When the checkered flag falls, the real race becomes the pursuit of inclusive economic stability and growth – and that race continues.

– Demetra Mykoniatis

Demetra is based in the United Kingdom and focuses on Good News for The Borgen Project.

Photo: Wikimedia Commons

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Kosovo’s Diaspora Fueling Economic Growth & Poverty Reduction

Kosovo's DiasporaA small state in the Balkans, Kosovo has a complex history and is a relatively new political entity. The nation was part of Yugoslavia as an autonomous province for decades. However, with the collapse of Yugoslavia in 1991, ethnic groups across the region declared independence, such as Slovenia and Croatia. 

Comprising a majority of ethnic Albanians, Kosovo declared its own independence on February 17, 2008. Today, Kosovo has defied economic expectations in many areas, largely due to its diaspora population across Europe and the world. About 800,000 Kosovars living abroad contribute a significant share of the country’s GDP through remittances.

Despite these economic successes, poverty remains a persistent problem. With poor educational performance, informal businesses, low salaries and high unemployment, Kosovo still has several institutional problems. While the rate of poverty has been declining over the past years, as of 2022, it still hovered around 25% or about one in four individuals. Along with several other factors, Kosovo’s far-reaching diaspora could help reduce these numbers.

Kosovo’s Diaspora Bonds

Over the past half-decade, Kosovo’s Ministry of Finance has issued bonds open to all nationals, particularly those living abroad. In 2021, for example, the government issued €20 million (about $23.6 million), with a guaranteed 100% return on investment and tax exemption. What this means, basically, is that the Central Bank of Kosovo offered to borrow about $23.6 million from Kosovar investors to fund infrastructure and government expenses. 

On the flip side, the Central Bank promises to repay its investors double the amount they invested. Nonetheless, by borrowing millions from its diaspora, Kosovo is better able to support important areas of the economy and education, thereby alleviating poverty and job insecurity.

How Local Governments Are Attracting Investment

After years of decentralization in Kosovo, attracting local investment to municipalities has become more difficult. Though these municipalities rely heavily on government grants, many are adapting their structures to support expatriate investors. The cities of Suhareka and Suva Reka, for example, have established a Directorate for Diaspora, which is dedicated to aiding Kosovo’s diaspora. 

This administration organizes relevant investment events and facilitates business registration and tax easements, to name only a few of the many services provided.

Real Estate Investment

Real estate makes up the largest share of diaspora investment in the Balkan country, accounting for about 70% of total investments from abroad. Investment in housing and apartments has sparked debate over the true economic impact. Some believe that investment in tourism and industrial development offers greater growth opportunities.

On the other hand, real estate investment increases employment opportunities, which in turn partially fuels the economy. With more jobs, more money circulates, benefiting everyone. Additionally, an IE University study found that a “rise of small investors increases the price-to-income ratio,” often leading to higher real estate prices. These higher prices, therefore, often indicate higher GDP per capita in the region.

In summary, it is unclear how much the Kosovan economy will benefit from these large real estate investments by Kosovo’s diaspora. Whatever the case, expatriate investors are pouring millions of dollars into the nation, ultimately growing the economy, even if by small increments.

How Is Poverty Affected?

The Kosovo diaspora offers potential economic benefits, including through government bonds, local municipal initiatives and independent real estate investment. This potential growth, however, could prompt shifts in the country’s poverty levels. Individuals are pushed above the poverty threshold as the economy grows and new jobs are created. 

While the influence of Kosovar foreign nationals is several steps removed from directly impacting poverty, their investment efforts spark a small chain reaction that eventually has the capacity to combat poverty.

– Ben Anderson

Ben is based in Madrid, Spain and focuses on Business and Politics for The Borgen Project.

Photo: Unsplash

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The Rajpura–Mohali Rail Link & Regional Economic Access

The Rajpura–Mohali Rail LinkIndia has approved a new railway corridor from Rajpura to Mohali; the Rajpura–Mohali rail link is intended to greatly enhance travel throughout southern Punjab and the surrounding area around Chandigarh. This will improve travel to job locations, education, health care and other marketplaces. Improving the availability of these services may be particularly important for marginalized groups that rely on affordable public transportation. The rail link reflects India’s broader push to leverage infrastructure investment to expand opportunities for socioeconomic mobility.

Effective Regional Development

India’s rail network already serves as one of the largest public transportation systems in the world, carrying more than eight billion passengers annually. This development project to create a Rajpura–Mohali rail link will provide fast, affordable rail access, reduce commuting costs for low-income households and connect rural populations to urban job markets. The availability of reliable, affordable access to employment opportunities also enables workers to support themselves and their families while contributing to their communities by paying taxes and supporting local businesses.

Rail infrastructure is an important factor in reducing poverty, as it provides reliable access to employment opportunities through safe, affordable transportation. Reliable access to employment opportunities is essential to economic mobility; therefore, workers must be able to travel to their employment centers safely and affordably. Beginning with reasonably priced public transportation such as buses and trains, access to reliable employment allows workers to utilize employment opportunities they would not have had otherwise due to a lack of transportation.

Access to reliable employment opportunities also provides workers with the ability to increase their earning potential, which could provide them with a better quality of life through better living conditions, greater food security and better access to other necessities of life.

The Indian Government’s Infrastructure Development Strategy

Punjab is witnessing a significant increase in urbanization, primarily around Chandigarh. However, many rural and smaller towns are constrained by limited connectivity, hindering access to economic opportunities. The improved Rajpura–Mohali rail link may allow travelers to reach their destinations faster and rely less on expensive personal transportation.

In its pursuit to develop India, the Government of India views infrastructure as a key to long-term development. As part of this, it has committed, through the National Infrastructure Pipeline, to invest billions of rupees in transportation, energy and urban development to fuel long-term growth. Improved rail systems can create jobs during construction and support long-term employment by increasing mobility.

Research from the World Bank shows that infrastructure investment can boost productivity and reduce poverty when it improves access to markets and services. In regions where public transit remains the primary mode of travel for lower-income communities, expanding rail access can help narrow economic gaps.

Socioeconomic Mobility

Low-income households often spend a larger share of their income on transportation. Expanded rail access can reduce commuting costs and open up more job opportunities. Better connectivity also helps women access education and employment.

Students can commute safely to universities in Chandigarh, rural residents can reach specialized health care facilities and small businesses can move goods more efficiently. Transportation access is directly tied to economic participation. When people can move safely and affordably, they can earn better wages, improve health outcomes and invest in education.

Final Thoughts

The Rajpura–Mohali railway corridor shows how targeted rail development can reduce long-term geographic inequality in Punjab. The project will connect new urban centers with their surrounding areas. As construction moves forward, the corridor highlights a broader point: strategic infrastructure development is more than a physical building project. It can also be a powerful tool for reducing poverty.

– Julia Lavelle

Julia is based in New York, USA and focuses on Good News and Technology for The Borgen Project.

Photo: Pexels

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How Remittances to Mexico Are Helping Its Population

Remittances to MexicoAs families talk over FaceTime with their loved ones thousands of miles away, Mexican migrants continue to support their families living in Mexico. The decision to leave Mexico for a better life is an important and impactful decision for millions of Mexican families. With more Mexicans living abroad, remittances to Mexico have increased and helped millions of Mexican families.

What Are Remittances?

Remittances are money transfers that Mexican nationals living abroad send back to their families living in Mexico. For the last decade, “remesas” (remittances in Spanish) have been a fundamental source of income for families with family members working abroad. Families across Mexico have used these money transfers to afford necessities and foster development in their communities.

Remittances’ Impact in Mexico

Mexico has a long history of using remittances as a major source of income for its citizens. For years, Mexico has been the second-largest recipient of remittances globally, just behind India. In 2023 alone, Mexico received 7.5% of global remittances, representing $63.3 billion distributed to millions of Mexicans across the country.

Remittances to Mexico account for roughly 4.5% of its total GDP. To put into perspective, remittances account for more of Mexico’s GDP than Foreign Direct Investment (FDI), tourism and manufacturing. Furthermore, remittances are transferred directly to the population, allowing families to spend this money on what they need. Many families use this money to pay rent, afford weekly groceries, or other daily expenses. Others save this money for future expenses, pay for their children’s education, or invest in their home.

In 2024 alone, remittances helped more than 1.1 million people escape multidimensional poverty across all of Mexico. Without remittances, the number of people living in poverty would increase from 38.5 million to 39.9 million.

Remittances to Mexico not only have short-term benefits for families, but they also have long-term positive impacts on the overall economy. Remittances increase the purchasing power of millions of Mexicans, which in turn increases the consumption of products that benefit local businesses. They are also used to send the younger generations to school, which can have positive impacts in the future as education levels increase nationwide.

Government Involvement

The Mexican government has recognized the positive impact of remittances across the country and has taken steps over the last year to protect these money transfers, helping millions of Mexicans.

In July of 2025, the Mexican government introduced the “FINABIEN” card and “FINABIEN” app, an electronic card that allows migrants to send money back to Mexico more safely and reliably. This new system will facilitate money transfers for migrants living abroad, decreasing the cost of sending money to their families.

Living abroad can be a difficult experience, with families having to talk online to stay in contact with their loved ones. However, living abroad has positive benefits for migrants and their families through remittances. Remittances have allowed millions of families in Mexico to improve their lifestyle and invest in their future, contributing to Mexico’s long-term development.

– Rodrigo Salgado

Rodrigo is based in Boulder, CO, USA and focuses on Good News and Politics for The Borgen Project.

Photo: Unsplash

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Elderly Poverty in Slovenia

Elderly Poverty in SloveniaElderly poverty in Slovenia is becoming an increasingly pressing issue, despite the country’s reputation for strong social protection systems. A significant number of older adults struggle to afford necessities such as food, housing and health care due to rising living costs, population aging and limited pensions.

Pensions and Income Insecurity Among Older Adults

Most older people in Slovenia rely on their pensions as their primary source of income. However, they frequently do not keep up with inflation and rising living costs. The Organization for Economic Cooperation and Development (OECD) reports that many workers in Slovenia have net pension replacement rates below the OECD average, leaving retirees vulnerable to income instability.

Women, who frequently have interrupted work histories and lower lifetime earnings, are disproportionately affected by lower pensions. After retirement, the likelihood of falling into poverty rises sharply. According to the Statistical Office of the Republic of Slovenia, older individuals in Slovenia are more likely than the general population to experience poverty or social exclusion.

Due to fixed incomes and limited access to informal support networks, older single-person households are more likely to face financial strain.

Rising Living Costs and Housing Pressure

Poverty among older adults in Slovenia has worsened due to rising housing and energy costs. Although many seniors live in privately owned homes, they often struggle to pay for utilities, maintenance and heating. Income poverty and material deprivation are closely linked.

Eurostat reports that a significant share of Slovenia’s population cannot keep their homes warm enough. Older people with limited incomes are also heavily burdened by health care costs. Despite Slovenia’s universal health care system, long-term care services and prescription drugs can be costly.

Generally, older people with lower incomes are more likely to delay or forgo medical treatment due to financial constraints, increasing health risks and deepening poverty.

Social Isolation and Hidden Poverty

In Slovenia, social isolation and poverty among older people are closely related. Reduced social engagement is common among older adults with low incomes, which can worsen mental health outcomes and increase vulnerability. According to a European Commission report, poverty and insufficient income support are closely linked to social exclusion among older populations.

Policies and Programs Addressing Elderly Poverty

Energy subsidies for low-income households, social assistance supplements and minimum pension schemes are some of the policies the Slovenian government has implemented to reduce elderly poverty. Although there are still gaps for those with limited pension entitlements, the European Commission claims that these social transfers play a significant role in reducing poverty risks among older adults.

Long-term investments in adequate pensions, affordable health care and targeted social support are necessary to address elderly poverty in Slovenia. Ensuring financial security and dignity in later life can be achieved by strengthening income protection and expanding support for vulnerable older adults. In addition to improving individual well-being, reducing elderly poverty supports broader initiatives to reduce inequality and promote inclusive economic development.

– Honey Regev

Honey is based in Edinburgh, Scotland and focuses on Business and New Markets for The Borgen Project.

Photo: Pexels

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Venezuelans in Poverty: Life Under Maduro

Venezuelans in Poverty: How Economic Collapse Shaped Life Under MaduroAt the turn of the New Year, the seizure of Nicolas Maduro by the United States (U.S.) military in an operation conducted in Caracas dominated the headlines. The move drew criticism from some who cited concerns about international law violations against a sovereign nation, as well as the fact that the executive branch of the U.S. directed the military action without prior congressional approval. Many in Venezuela, meanwhile, expressed support for the end of an administration widely blamed for declines in quality of life over the course of this century. Life for Venezuelans, particularly under the Maduro government, has been shaped by prolonged economic and humanitarian challenges.

A Population in Dire Need

Multiple sources highlight a longstanding humanitarian crisis in Venezuela. As of 2026, 7.9 million Venezuelans need humanitarian assistance. An additional 7.9 million Venezuelans have been forcibly displaced due to deteriorating economic conditions, a figure the United Nations High Commissioner for Refugees (UNHCR) describes as the “largest displacement situation in the recent history of the Americas.”

Furthermore, the United Nations Office for the Coordination of Humanitarian Affairs (OCHA) reports that 5.4 million people are projected to receive some form of international assistance, leaving 2.5 million Venezuelans, nearly 9% of the country’s population, without projected coverage. In addition, 56% of Venezuela’s population lives in extreme poverty.

The Driving Factors

Venezuela’s humanitarian crisis is closely tied to prolonged economic hardship. The Council on Foreign Relations (CFR) identifies the country as a petrostate, meaning it depends heavily on fossil fuel income. Petrostates face the risk of “Dutch disease,” where over-reliance on oil revenue contributes to the deterioration of other sectors of the economy.

Despite having the world’s largest oil reserves, Venezuela experienced significant economic contraction. Time reports that the U.S. first imposed sanctions in 2017 in response to democratic backsliding, further impacting an already struggling economy. From 2013 to 2021, Venezuela’s economy shrank by 70%. Former finance minister Jorge Giordani stated that between 2008 and 2014, officials redistributed two-thirds of oil profits into the economy, while one-third “slipped through the cracks.”

Support Venezuelans: Current Needs

A poll by Gold Glove Consulting indicates that a majority of Venezuelans report optimism following Maduro’s removal. However, economic recovery remains uncertain. The U.S. appointed Delcy Rodriguez as interim president. Although she served in the Maduro administration, she has pledged cooperation with Washington, though not without caveats.

According to Al Jazeera, the Venezuelan government no longer controls its income streams. Funds are deposited into a Qatari account subject to U.S. veto power. Venezuela must submit monthly budget requests for the distribution of those funds. Al Jazeera also reports that experts have raised concerns regarding transparency in the allocation of these funds.

OCHA projects a funding requirement of $606 million for 2026 and reports a funding gap of $587.1 million, constituting coverage of 3.12%. Continued humanitarian funding remains central to supporting Venezuelans facing displacement and poverty.

Looking Ahead

While Venezuela continues to face significant economic and humanitarian challenges, coordinated international assistance and transparent management of resources could help stabilize conditions. Sustained humanitarian funding and targeted support for vulnerable communities remain essential to improving living standards and promoting long-term recovery for Venezuelans living in poverty.

– Luca Hanlon

Luca is based in Brooklyn, NY, USA and focuses on Good News and Politics for The Borgen Project.

Photo: Flickr

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Labor Market Reforms & Low-Income Workers in Vietnam

Low-Income Workers in VietnamOver the past two decades, Vietnam has made exceptional progress in reducing poverty. However, low-income workers remain vulnerable to economic shocks and to informal employment. To address these challenges, the government has implemented labor market reforms to improve wages and job security for millions of workers.

There are multiple contributors to poverty in Vietnam, with low wages and informal employment being the primary ones. Instability and limited access to benefits become inevitable for workers without contracts or social insurance, especially during economic downturns. By enhancing labor market policies, the nation aims to stabilize household incomes among low-income workers, particularly in manufacturing, agriculture and the informal sector.

The nation has increased its regional minimum wage as part of broader labor reforms and in 2022, the government approved a 6% increase. This initiative raised the earnings for millions of low-income workers. An increase in minimum wages helps workers cover basic living costs and reduces in-work poverty, especially for communities that depend entirely on wage labor.

Labor Code Reforms Strengthen Worker Protections

Vietnam’s updated Labor Code, which took effect in 2021, expanded worker protections by regulating working hours and improving the procedures against unfair dismissal. The reforms also improved collective bargaining rights and extended coverage to groups previously excluded from formal protections. Collectively, these initiatives are helping reduce labor vulnerability in Vietnam and ultimately improve working environments for low-income workers.

Access to social insurance is crucial for protecting workers from poverty caused by illness, unemployment or old age. Improved access to insurance can reduce financial insecurity and help workers recover more quickly from economic downturns without falling into poverty. That said, Vietnam has expanded social insurance coverage to include more low-income and informal workers, though inevitable gaps remain.

Challenges Remain for Informal Workers

Despite progress, informal employment remains widespread nationwide, especially among rural workers and migrants. Multiple factors continue to restrict the reach of labor reforms, including enforcement gaps and uneven compliance. Addressing these challenges is crucial and will require better and stronger enforcement and continued policy coordination to ensure that the reforms reach the most vulnerable populations.

Labor market reforms have already played an effective role in supporting low-income workers and reducing poverty nationwide. However, continued investment in fair wages, worker protection and the expansion of social insurance could further enhance Vietnam’s economic resilience and promote inclusive growth.

– Hana Abulkheir

Hana is based in London, UK and focuses on Politics for The Borgen Project.

Photo: Unsplash

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How Tradedepot Is Driving Growth for Small Retailers in Nigeria

TradeDepotAcross Nigeria, small retailers power local economies, yet remain disconnected from efficient global supply chains. This gap drives high costs, inefficient logistics and lost income opportunities for informal businesses. TradeDepot offers a digital solution to this challenge, bridging global supply networks and small retailers in Nigeria.

The Gap Between Small Retailers and Reliable Supply Chains

Small retailers, including family-run shops, street vendors and kiosks, are the backbone of developing economies. Many operate out of homes and are run by women balancing entrepreneurship with domestic work. Together, these businesses account for up to 80% of employment in Africa, making them a powerful driver of income generation and poverty reduction.

Studies by TechnoServe show that targeted support for small retailers can increase incomes by more than 30%. Given the scale of informal retail across Africa, even minor improvements can create lasting economic and social impact. As the final link in the supply chain, small retailers are responsible for distributing essential goods within their communities.

Yet persistent gaps between informal retailers and major suppliers result in fragmented logistics, limited visibility and widespread inefficiency. In Nigeria alone, these systemic gaps generate more than $4 billion in annual losses across the consumer goods supply chain. Most existing supply-chain technologies prioritize large enterprises, leaving informal retailers underserved.

By directly connecting small retailers to reliable supply networks, platforms like TradeDepot enable business owners to save time, reduce costs and increase profits.

TradeDepot’s Digital Solution

African retailers face some of the highest product distribution costs globally and TradeDepot is working to change this reality in Nigeria. By establishing a direct digital channel between manufacturers and informal retailers, the platform streamlines procurement, logistics and inventory management in a single system. Through this platform, small retailers in Nigeria can place orders, track deliveries and manage inventory in real time.

Increased price transparency and access to supplier discounts reduce costs at the earliest stages of the supply chain, directly improving retailer margins. TradeDepot positions itself as the middleman between global brands seeking new markets and Nigerian retailers pursuing growth. As the company scales, it is extending its logistics and distribution expertise to support informal retail ecosystems across Africa.

Market Potential for Global Brands

Africa’s young and rapidly growing population presents major opportunities for global brands. Rising incomes and urbanization are driving demand for quality consumer goods. Yet, fragmented logistics continue to constrain efficient trade and prevent profits from staying within local economies.

TradeDepot’s model reframes poverty reduction through a business lens, shifting power within supply chains toward small retailers. Rather than charity, it provides entrepreneurs with the tools, data and market access required to drive sustainable business growth.

Improved Quality of Life for Small Retailers in Nigeria

TradeDepot’s platform is transforming daily business operations, giving small retailers in Nigeria greater autonomy, predictability and control. As many informal shops are home-based and women-led, these efficiencies have a powerful impact on female entrepreneurs. Women account for 85% of TradeDepot’s retail users and 65% of its distributor network.

Access to tools such as digital wallets and credit lines strengthens financial inclusion, increasing women’s purchasing power and business agency. In a survey of more than 200 customers, 90% reported improved quality of life after adopting TradeDepot’s platform. Retailers no longer need to close shops or travel long distances to source stock.

Instead, they can access consistent inventory at fair prices through nearby depots, improving product availability for communities while boosting retailer profits.

Final Thoughts

By connecting global brands with informal retailers, TradeDepot is driving growth for small retailers in Nigeria, unlocking Africa’s consumer market while navigating the continent’s complex distribution networks. The result is stronger small businesses, more resilient local economies and a scalable, market-driven approach to poverty reduction.

– Hope Jowharian

Hope is based in Paris, France and focuses on Business and New Markets for The Borgen Project.

Photo: Pexels