Archive for category: Economy

Information and stories about economy.

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5 Countries in Southeast Asia Supporting American Exports

American ExportsThroughout the past several decades, nations in Southeast Asia have seen significant declines in extreme poverty rates. As poverty has fallen and these nations have developed economically, the Association of Southeast Asian Nations has become the United States’ fourth-largest trading partner. While the United States does rely heavily on this region for imports, trade with ASEAN also supports American exports and bolsters nearly 346,000 American jobs. The following five countries in Southeast Asia are critical trading partners and demonstrate the economic benefits that can coincide with a decrease in extreme poverty:

1. Malaysia

Malaysia has been extremely successful in reducing poverty throughout the past several decades. According to the United Nations, “… in 1970, 49.3% of Malaysian households were below the poverty line.” As of 2015, the figure had fallen to 0.4%. As poverty has fallen, Malaysia has also grown economically, developing profitable manufacturing, petroleum and natural gas industries.

As the country has reduced poverty and developed economically, it has become an important trading partner to the United States. The United States imports electrical machinery, tropical oils and rubber from Malaysia. It also exports soybeans, cotton and aircraft to the nation. In total, the trade between the two nations totals around $57.8 billion each year and supports nearly 73,000 American jobs.

2. Thailand

Thailand is another country that has seen impressive levels of poverty reduction in recent decades. According to The World Bank, poverty rates fell from around 65% in 1988 to under 10% in 2018. The nation has also evolved economically, developing large automotive and tourism industries as poverty rates have fallen.

Trade between the United States and Thailand has steadily grown, totaling $48.9 billion in 2018. When analyzing imports, the United States relied on Thailand for machinery, rice and precious metals. In terms of exports, the United States provided the nation with electrical machinery, mineral fuels and soybeans. In total, the exports to the nation supported nearly 72,000 American jobs. Additionally, exports to Thailand have been increasing in recent years, growing nearly 14.5% from 2017 to 2018.

3. Vietnam

Vietnam is perhaps one of the most astounding examples of poverty reduction and economic development. The World Bank reports that “the poverty headcount in Vietnam fell from nearly 60% to 20.7% in the past 20 years.” As it has done so, the nation developed one of the most rapidly growing middle classes in Southeast Asia, became a center for foreign investment and developed key industries in electronics, footwear and textiles.

While the United States has come to heavily rely on Vietnamese imports, Vietnam is also a rapidly growing market for American exports. In fact, American exports of goods to Vietnam increased by 246.9%, and American exports of services to the nation increased 110% since 2008. According to the Office of the United States Trade Representative, “U.S. exports of Goods and Services to Vietnam supported an estimated 54,000 American jobs in 2015.”

4. Indonesia

Though the nation still has significant progress to make, Indonesia is another nation that has seen a reduction in extreme poverty rates. Since 1990, the nation has managed to half its poverty rate and make significant economic advancements. Currently the largest economy in Southeast Asia, the nation has developed notable industries in petroleum, natural gas, textiles and mining.

Trade with the nation totaled around $32.9 billion in 2019. While the United States imported apparel and footwear from the nation, it also exported soybeans, aircraft and fuels to Indonesia. In total, American exports to Indonesia are growing, increasing 19.1% from 2017 to 2018 and supporting nearly 56,000 American jobs.

5. Philippines

While poverty is still an issue in the Philippines, it has seen significant declines in recent years. According to the World Bank, poverty fell from 26.6% to 21.6% from 2006 to 2015. The nation has also made significant improvements in developing industries outside of agriculture. While agriculture composed nearly one-third of the nation’s GDP in the 1970s, it currently represents 9.3%, split between an emerging industrial and service sector.

Trade with the nation currently provides $29.6 billion each year, and exports to the Philippines grew 3% from 2017 to 2018. Mainly, the Philippines relies on American exports for electrical machinery, soybean meal, and wheat. Overall, exports to the Philippines support an estimated 58,000 American jobs.

Affecting nearly one in five American jobs, international trade is a critical part of the American economy. As demonstrated by Southeast Asia, a reduction in global poverty rates not only contributes to global economic development but also supports the export industry and American jobs.

– Michael Messina
Photo: Pexels

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The Secret Village of Jamaica: Jamaica Deaf Village

Secret Village of JamaicaJamaica remains one of the largest islands in the Caribbean. However, many recognize it for more than its vibrant culture. The island has incurred great debt over the years and is constantly subject to mother nature’s unpredictability. Jamaica has a constant threat of hurricanes, high debt and an overall poorly structured economy. Therefore, many Jamaicans find themselves living under the international poverty line. Any person living below this line will face a number of obstacles. However, a disabled person living in poverty faces unique challenges. People with disabilities have a greater job opportunity in the U.S. In many other parts of the world, society has isolated them.

In Jamaica, there are laws that affect the daily lives of disabled islanders, especially those who are deaf. The deaf community in Jamaica cannot drive or work due to their lack of hearing ability. As a result, they spend their lives separated from the rest of their island nation. The Jamaican Deaf Village (JDV) is a small village in Mandeville, Jamaica where the deaf can easily live, work and communicate with each other. Mandeville is a small town in the mountains near the center of Jamaica. In this village, deaf people find a way to work and participate in the diminutive economy.

How the Village Began

This secret village in Jamaica established in 1958. Reverend Willis Etheridge and his wife visited the island and saw the unique struggles faced by the deaf community. The couple founded the Caribbean Christian Center for the Deaf (CCCD). In 1984, the organization took 100 acres of land and began the physical construction of the JDV. During the village’s early years, there was a church, factory and some small houses for the residents. The island of Jamaica is proud of its religious culture (mainly Christian). So, this church for the deaf was an important step for them. The factory was meant to provide employment specifically for deaf islanders so they could support their own families while also participating in the Jamaican economy.

After several years of planning, development and outreach, the first deaf residents moved into the village on July 15, 2002. Only a short time after that, workers produced the factory’s first product. This was the first step to creating a self-sufficient village.

How JDV Operates Today

The Jamaican Deaf Village in Mandeville has grown exponentially since its conception. Today, the village has farms, houses, apartments, a recreational center and a kitchen house. The kitchen house is a large kitchen and dining area where the residents will all gather together for their meals.

Each resident in the village takes on a specific role in order to create this self-sufficient community. Many women work in the kitchen house where they cook, clean dishes and do laundry. Another part of the kitchen house is the art room. This small room contains a number of paintings, sculptures, jewelry and various other art pieces created by JDV members. These pieces are popular souvenirs for visitors and another way for deaf Jamaicans to participate in the local economy.

The farm in JDV is a critical aspect of the village. Those who take on farming roles tend to livestock and crops daily. Their livestock consists mostly of cattle, goats and sheep. The crops produced in the village are a range of tropical fruits such as plantains, bananas, mangos and more.

Products from the farm are mainly used to feed the local residents. However, they can also sell their crops to the markets. Since the village is in the middle of the mountains, it takes several hours for residents to get into town. This creates another obstacle for the impoverished deaf. However, their small agricultural production plays a huge role in keeping them fed.

How the JDV Receives Funding

The key source of funding for this secret village in Jamaica is the factory. Over the years, they have manufactured a variety of products, but they started with furniture. The first object ever produced from this small factory was a wooden chair. The deaf is able to earn a living and partake in the Jamaican economy by manufacturing furniture and other objects. They build them in their home village and sell them to outside buyers.

This secret village of Jamaica also loves hosting visitors. The CCCD created a special program where visitors can come stay in the village for a period of time. While there, visitors help perform basic tasks. Visitors immerse themselves in the deaf culture and learn how each of the various roles of the village work. These roles range from farming to laying down cement for new buildings. Visitors from around the world can get a firsthand look at how these islanders keep themselves above the poverty line.

How the JDV is Essential for the Poor and Deaf

The key role of the JDV is providing the deaf community of Jamaica a life they would otherwise not have. About 19% of the Jamaican population in 2017 fell under the poverty line. This number has gradually decreased over the last three years. However, there is still a large number of Jamaicans who find themselves lacking basic necessities. The most common issues found among the impoverished population is a lack of food and clean, piped water. Jamaicans who suffer from a severe disability tend to find it even harder to gain access to these necessities. Disabled islanders are typically not allowed to work or even drive in most cases. This is especially difficult for the deaf as they can perform basic tasks but do not get utilized.

Many deaf Jamaicans will come to the United States just to get a degree or driver’s license. The Jamaican Deaf Village allows those with hearing disabilities to use their skills and create a life for themselves. This is an opportunity that would, otherwise, be denied.

The Jamaican Deaf Village plays an important role in the deaf community of Jamaica. However, it also contributes to the island’s overall economy. Over the years, the village has become a popular tourist destination. Just as most islands around the Caribbean do, Jamaica’s economy highly benefits from tourism. The village has become a hot spot for international visitors. In addition, the unique products created in the village create extra income.

This secret village in Jamaica provides a positive lifestyle for the deaf community they otherwise would not have. It also allows them to do their part to improve the island’s economy.

– Brittany Carter
Photo: Good Free Photos

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Ecotourism: Leading Economic Development in Island Nations

Economic Development in Developing Island Nations
Island nations such as Fiji and Tonga are isolated paradises largely cut off from global markets. As tourism increases through the year however, these countries’ economies thrive. While ecotourism in developing island nations increases employment rates and the development of other important sectors, it has to be done with the land and its people in mind.

What is Ecotourism?

Ecotourism in developing island nations is an economic development tool that involves bringing local communities and travelers together in an environmentally friendly way. The main benefits include the preservation of native lands, increases in local employment rates and increased funds for continued conservation. If not kept in check however, ecotourism has the potential to exploit an island’s natural resources and populations, so it must be implemented in the most sustainable way possible. Once nations see improvements in their tourism industry, they can easily become vulnerable to large corporations wanting to create new—and potentially damaging—markets there.

Why Tourism is Important to Developing Island Nations

The World Bank has identified 11 Pacific Islands (PIC 11) that will benefit immensely from increased tourism. These islands are: Papua New Guinea (PNG), Solomon Islands, Vanuatu, Fiji, Tonga, Samoa, Kiribati, Palau, Marshall Islands (RMI), Federated States of Micronesia (FSM) and Tuvalu. These countries received over 1.3 million visitors in 2014 and are renowned for their beautiful landscapes, diverse cultures and incredible natural resources. Of this group, countries with the highest tourism rates also have the highest employment rates. The industry employs 15% of the population in Tonga, 18% in Samoa, 50% in Palau.

The Caribbean is one of the most popular tourist destinations, with many of its nations’ economies heavily or completely reliant on tourism industries. The World Bank has started initiatives within the region to establish “blue economies” that take both economic development and environmental effects into consideration. Since 2010, the region’s GDP has increased alongside the growth of island tourism. Unfortunately, these changes have come with an increase in plastic marine debris and the destruction of coral reefs. The main focus of these “blue economies” is to establish a balance between the ocean and the economy so everyone benefits.

Ecotourism Efforts to Support

There are many organizations working to make ecotourism in developing island nations a reality. Ecotourism Belize hires local workers in the Toledo District as guides for tours through the Belizean jungle. They also have a group of bird specialists and traditional healers hired. All employees are of Mayan descent so they are able to give honest representation of ancient Mayan culture and convey how it has been passed down through generations. All of Ecotourism Belize’s profits fund conservation efforts within the Maya Golden Landscape.

In 2017, Palau became the first country to require an “Eco-Pledge” by visitors upon entering. Over the past several years it has seen tourist rates grow seven times larger than the region’s native population. Home to beautiful natural ecosystems, Palau knew it had to mitigate the rise in the destruction of its land due to increased tourism. The country’s government found this destruction was due to a lack of education. By introducing visitors to a localized way of thinking about the environment, the government has taken an important first step towards successful ecotourism.

Keeping Things Balanced

Ecotourism in developing island nations has the potential to help eradicate poverty in these regions. Done correctly, it allows locals to hold onto their culture while protecting their resources and ecosystems at the same time.

– Stephanie Russo
Photo: Flickr

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Africa Struggles with Lack of Tourism Revenue

lack of tourism
As a result of the COVID-19 pandemic, international travel has been at a standstill, affecting many developing countries in Africa that rely heavily on the funds that tourism generates. The aftermath of the lack of tourism has resulted in the loss of jobs for locals, decreased funding for conservation and a plummet in economic stability.

Effects on Tourism Revenue

The pandemic has affected people worldwide, especially in impoverished African countries where the tourism industry has flourished, becoming the second-fastest growing tourism industry in the world, noted in 2019. Conservation, safari and other nature-based tourism activities closely relate to each other, creating a large industry for Africa to economically capitalize and grow upon. With the ban on international travel, though, the country has not been able to yield the same amount of tourism profits as in 2018, when it brought in $194.2 billion.

Projections determine that profits will not be nearly as high in 2020 as they were in 2018. In 12 months, predictions are that Africa will lose over $30-$50 million in tourism revenue due to cancelations and rescheduling of international travel. The effect of the COVID-19 pandemic is detrimental to Africa in 2020 as the U.N. estimated the people have lost 2 million jobs, directly affecting funding for businesses.

Loss of jobs and businesses, directly linked to lack of tourism and COVID-19, has changed the estimates on the poverty line in 2020. While projections determined that poverty in 2020 would decrease to 7.8%, loss of work and an increase in COVID-19 cases has now estimated that the poverty rate will increase from 8.2% in 2019 to 8.6% in 2020.

Poaching on the Rise

Anti-poaching laws went into effect in 2013 to abolish wildlife crimes in an effort to help the wildlife remain. The loss of funding and lack of tourism has affected many industries but poaching specifically has continued to be an ethical issue that Africa’s wildlife conservation and implementation of anti-poaching laws continue to battle.

With tourism on the decline during the pandemic, wildlife conservation efforts and parks have become drastically underfunded and unsupervised, with the termination of income and jobs for many residents. Lack of supervision within the parks has allowed for poachers to find loopholes and become inconspicuous as supervision in the parks decreases due to employment cuts.

With approximately 2 million residents out of work, it was not unexpected for Africa’s wildlife to become the cheapest option for food. In fact, estimates determine that 49 million people will fall below the poverty line due to COVID-19’s effect on employment opportunities.

Solutions and Partners

Though conservationists have a potentially destructive crisis at hand, many organizations will continue to use reserved funds in hopes of donations from private sectors and the assistance of other organizations. Conservation NGO African Parks commits 100% of its donations to 17 other parks who are partnered with the organization. However, due to the decrease in tourism, the park has lost 10% of its budget.

The World Health Organization has set forth the Global Humanitarian Response Plan, which has raised $7.6 billion as of April from funding inside and outside of Global Health Outreach base funding. This funding will allow for the Humanitarian Response Plan to assist not only Africa but 53 other struggling countries, regions and continents globally. In January 2020, the Global Humanitarian Response Plan sent “300 metric tons of humanitarian and medical cargo to 89 countries.” It will continue to assist with meals, water and medical supplies.

Severe food insecurity is not a new issue for residents in African regions: nearly 27.4% of the population was already severely food insecure in 2016. Urban areas will be heavily affected by these shortages. The World Food Program (WFP) is assessing the situation for food shortages. Knowing that many children receive food at school, WFP says it is working to provide “take-home rations” to assist with food insecurity. Furthermore, WFP positively stated that as of April 16, 2020, food assistance and movement remain normal for the time being and it is continuing to deliver food throughout South Africa.

– Allison Lloyd
Photo: Pexels

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How Delivery Apps Aided China During COVID-19

delivery appsWhen China was at the peak of its COVID-19 outbreak, unexpected lockdowns affected well over 700 million people. Hundreds of thousands of these people grew anxious and engaged in panic buying, leaving essential stores depleted. Many people suffered from a lack of necessary supplies as a result. However, within days, supplies from all around the world began flowing into China. In order to comply with lockdown measures, many people turned to digital delivery apps to continue receiving their basic necessities.

Efficient Delivery

Despite its new uses during the pandemic, delivery technology is not a new concept in China. In fact, China has one of the most efficient delivery systems in the world. While other globally renowned companies, such as the U.S.-based e-commerce platform Amazon, pride themselves on rapid, two-day delivery, China’s home delivery apps can be at your door within minutes.

These digital delivery platforms, better known as wai mai xiao ge (which directly translates to “takeaway lad”), have flourished throughout the country. Whether users need to order takeout, groceries or even a portable phone charger, these delivery apps can do it within minutes. Though these platforms were originally seen as a convenient method to receive goods, they soon turned into a vital lifeline after China enacted stay-at-home measures during the COVID-19 pandemic.

Creating Jobs

Besides aiding those at home in need of essential goods, wai mai platforms have also greatly benefitted the deliverers themselves. Meituan Waimai, one of the most prominent on-demand delivery companies in China, created over 336,000 jobs for wai mai drivers as the coronavirus surged. These new jobs were vital opportunities for those who lost their primary source of income during the crisis.

Zhang Shuai, a 24-year-old delivery driver from Zhengzhou in Henan province, works in Shanghai, one of the largest and wealthiest cities in China. Shuai signed up to work with Meituan Waimai when COVID-19 cases began to grow because it was too difficult to find any other job. However, his delivery job with Meituan Waimai now provides him with $1,400 per month, a wage that is higher than the average urban salary in Shanghai.

Many workers from remote, rural villages also use these jobs with delivery apps as an opportunity to move to more urbanized cities and establish a less regimented life for themselves. While living in the village, many people from rural China worked in factories that often required a specialized skill set and a peer who could provide a recommendation for them. However, the same workers can get hired as a deliverer in a metropolitan city soon after verifying their identity and credentials. Once hired, they can receive better pay than what factory work would provide.

The Future of Meituan Waimai

As the pandemic continues, home delivery systems also continue to grow with it. Prior to the COVID-19 outbreak, Meituan Waimai was a $46 billion business. However, within the last few months, it has reached a record high at $100 billion amid the virus and is projected to continue growing from there, providing more job opportunities as it does so.

– Heather Law
Photo: Pexels

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Nintendo Fights Poverty One Console at a Time

Nintendo Fights PovertyAs citizens around the world were encouraged to socially distance and stay at home amid the initial spread of COVID-19, two things soared in popularity: household supplies, such as cleaning wipes and toilet paper, and one of Nintendo’s newest console releases. The Nintendo Switch has kept millions of people occupied while transitioning into a completely new- and for many, less busy- lifestyle. What may be the most fascinating aspect of this spike in product demand is that the purchasers of the Nintendo Switch have not only found a new pastime, but also contributed to the fight against global poverty from their very own couches.

Nintendo Fights Global Poverty

Nintendo’s headquarters are located in Kyoto, Japan, but the company has bases in almost forty other countries. However, benefits are not exclusively reserved for countries that house Nintendo stores. The company’s popularity, success and reach are also advantageous for other countries that are exporters of some of the necessary raw materials needed to make Nintendo Switches, such as various metals, fossil fuels, chemicals and plastics. Being an exporter of materials in high demand means that a country can earn high profits. Not only do these exporting countries see such an increase in profits, but they can also use the opportunity to lower the unemployment rate, as they will require more workers to accommodate rising global demand.

As its popularity spreads, Nintendo is expanding and creating more jobs across the globe. Despite Nintendo’s classification as a gaming company, expansion means that diverse positions in management, computer science, janitorial services, marketing and more will need to be filled as new regions, branches and stores are opened. And put simply, when more people earn wages, poverty can be reduced.

Nintendo Empowers Women

As Nintendo fights poverty by creating jobs in everything from metal transportation to software engineering, it has also developed a corporate promise to empower women. In 2016, the company set a goal to increase the percentage of women recruited or promoted by 5% throughout the following five years. Female employees have praised Nintendo for its active support on issues ranging from parental leave to paying for courses in professional female empowerment. Women make up approximately 70% of the globally impoverished due to pay gaps, being held primarily responsible for child-rearing and a smaller likelihood of being educated, and Nintendo’s efforts are slowly but surely lowering their global poverty rate.

Poverty in the United States

United States chapters of Nintendo fight poverty by donating annually to charities. These charities include the Boys & Girls Club of Bellevue, for which Nintendo holds drives to collect school supplies for low-income families and support chapters in low-income areas, the YWCA Family Village, where it sponsors a Thanksgiving dinner drive, and the Nintendo Annual Golf Tournament, from which proceeds are donated to a different charity every year. It also supports employees’ interests through its dollar-for-dollar gift-matching program to any certified organization of the employee’s choice.

As medical professionals continue to encourage people to stay at home, boredom is bound to ensue, and it may lead to an increase in sales for Nintendo consoles and games. For every product sold, dozens of Nintendo employees benefit; the truck drivers transporting materials, the project manager in Thailand overseeing electrical equipment exports, the factory worker making the consoles, the cleaning crews coming in after dark, and countless more. The interconnectedness of global industry ensures that one purchase can have effects in places customers have never even seen; those who have done nothing over quarantine but play on their Nintendo Switches can rest assured, then, that their impact is much larger than they think.

– Becca Blanke
Photo: Needpix

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The Impact of COVID-19 on Nigeria’s Economy

Nigeria's Economy
Nigeria, home to Africa’s largest economy, is facing consequences from the surge of COVID-19. After experiencing a recession in 2014, the country was finally seeing progress in its oil exports, resulting in overall financial recovery. That is until the pandemic hit. Nigeria is struggling to reignite its economy as the damages of the novel coronavirus persist. The country’s dependency on oil exports, along with the inevitable effects of a country-wide lockdown, are two reasons for Nigeria’s economic downturn. However, steps are being taken to boost Nigeria’s economy. This article articulates both the economic impact of COVID-19 in Nigeria and recent motions toward recovery.

COVID-19: The Numbers in Nigeria

According to the World Health Organization, Nigeria has seen over 38,000 cases of the coronavirus and over 800 deaths. In a country of around 214 million, the fatality rate is about 2% or 418,000 Nigerians. What does this mean for their economy?

Despite a recession from 2014 to 2016, The World Bank asserts that Nigeria’s economy may be headed toward the worst financial state the country has seen in four decades. Nigeria is extremely dependent on oil, which represents more than 80% of the country’s exports. With international travel halted due to COVID-19, the country has recorded an 18-year low on fuel prices, at $22 per barrel. According to economics experts, the Nigerian revenue flow will decrease to 1.1 trillion Naira (about $3 billion). That is about a 4.4 trillion Naira decline from the beginning of 2020.

The National Bureau of Statistics states that 42% of almost 2,000 citizens interviewed were out of work as a result of the pandemic. Out of all households interviewed, the poorest households saw the highest share of unemployment, at a jarring 45%. Moreover, 79% of reported households saw a decrease in their income as of March 2020.

Oil exports are not the only thing hurting Nigeria’s economy. Prices of common goods, like bread and water, increased shortly after a lockdown was enforced on March 30. A single loaf of bread increased from N350 to N450 (around ¢90 to $1.16). Pure, clean household water in Nigeria normally costs about N100, but since the pandemic, the price has doubled. As the consumption of goods, investments and net exports decrease, Nigeria’s economy is facing a harmful downturn.

The Good News

There remain reasons to be hopeful for Nigeria’s economy. Early in the pandemic, the National Orientation Agency (NOA) performed contact tracing calls to prevent the spread of COVID-19. These calls were made to people deemed “passengers of interest,” or those who had been traveling in recent weeks. Not only did these calls help slow the spread of the virus by enforcing self-isolation, but they also created a sense of comfort. The calls aided monitoring symptoms and provided psychological encouragement during an unprecedented time.

Nigeria’s government has also worked to help people financially impacted by COVID-19. The Central Bank of Nigeria (CBN) set out a 50 billion Naira ($139 million) stimulus package for Nigerian households and small to medium-sized businesses. Moreover, interest rates on CBN interventions decreased from 9% to 5% in an effort to aid Nigeria’s Economy.

UNICEF has also contributed to helping Nigeria throughout the COVID-19 pandemic. In collaboration with the Nigeria Center for Disease Control (NCDC), UNICEF is ensuring that all mothers with children under the age of two are able to safely breastfeed their babies, making sure they follow health guidelines.

With children out of school due to the pandemic, the National Agency for Food and Drug Administration and Control (NAFDAC) has provided training to mothers to screen their children for malnutrition. Many students depend on school lunches and considering the rate of job loss in Nigeria, this is a necessary step to ensure that all children are taken care of.

The pandemic has affected Nigeria’s economy and citizens to a grave extent. With oil exports reported at an 18-year low and job losses mounting, COVID-19 has destroyed whatever sense of progress Nigeria experienced since its last recession. With the support of the U.S International Affairs Budget, and with further foreign aid, Nigeria can hope for drastic changes in their job rates and oil exports.

– Anna Hoban
Photo: Flickr

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The Causes of Poverty in Kiribati

The Sources of Poverty in Kiribati
Kiribati is an archipelago comprising 32 coral atolls and one raised coral island located along the equator in the Pacific Ocean. The total landmass of the islands is slightly greater than New York City, but the islands stretch out across an area almost as large as the country of India with a population of approximately 112,000. The main island of South Tarawa accounts for roughly half the nation’s population, with a population density similar to that of Hong Kong and Tokyo. English is the country’s official language, but the popular dialect of I-Kiribati (a.k.a. Gilbertese) is commonly spoken. As of 1999, Kiribati is a member of the U.N. Today, poverty in Kiribati is prevalent, although unlike many other nations, the causes of poverty in Kiribati are slightly harder to define.

Subsistence Living

Many I-Kiribati lack access to fundamental services like water, sanitation, quality housing and other basic needs. The World Bank classifies Kiribati as “extremely deprived” although exact poverty estimates are hard to calculate because a significant portion (likely the majority) of the islanders practice a subsistence lifestyle, foregoing a role in the formal economy. This is especially true in the outer islands where people rely on fishing and agriculture to ensure their survival. The situation is precarious; however, as there is a widespread lack of arable land, droughts are common. Also, commercial overfishing has greatly reduced the bounty of fish Kiribati has been blessed with. Still, the people of the Kiribati islands find a way to overcome the mounting challenges confronting their lifestyle.

Underdeveloped Formal Economy

When it comes to the formal wage economy (which employs less than one-fifth of all potential workers), the densely packed island of South Tarawa is the home for over half of all jobs. A staggering amount of Kiribati’s income comes from fishing licenses sold to foreign vessels who want to fish tuna in Kiribati’s waters, but this income is highly unstable. A limited number of flights and poor national infrastructure inhibit its small tourism industry. The private sector economy lags far behind its public counterpart. Lack of a diversified economy is one of the causes of poverty in Kiribati.

Reliance on Imports

Most of the food and fuel consumed in Kiribati are imported from overseas. In 2004, a container vessel missed its scheduled food delivery date which caused a major food shortage on the islands. In past decades the population, especially younger people, is increasingly relying on cheaper imports of unhealthy and heavily processed foods. This has led to a rise in diabetes, heart disease and obesity. Kiribati has no domestic source of oil and thus relies on the international market. Direct foreign investment in Kiribati is very low, and in total, Kiribati’s imports are more than double the value of its exports. The causes of poverty in Kiribati can in large part be traced back to low food security and reliance on imports.

Education

The government of Kiribati provides free and compulsory primary education for students ages six to 13. Families living in rural areas incur travel expenses and all schoolchildren are subject to fees related to school uniforms and supplies. While this free education is certainly a positive, there is room for improvement in teacher training, curriculum and school facilities. Kiribati offers an additional five years of secondary education to students who place highly on national entrance exams. These schools are not free. Those who do not win access to these competitive schools receive the chance to continue with free secondary education for three more years. Nearly all secondary education schools are located on South Tarawa which requires prospective outer island students to move from their families and absorb a sizable financial hit. Around 80 percent of students do not continue on to secondary education after primary school.

Organizations Working for Change

Multiple organizations are working to help uplift locals and alleviate the causes of poverty in Kiribati. GAVI (Global Alliance for Vaccines and Immunizations) has been working in Kiribati for over a decade. It supplies vaccines to the islands and help local medical clinics administer these vaccines to the population. GAVI has committed more than $660,000. As of 2018, 95 percent of the islands have received coverage for critically important DTP3 vaccines (diphtheria-tetanus-pertussis).

Teachers are also working to improve the islands’ education system with the Kiribati Union of Teachers (KUT) performing outreach on three major islands. The KUT provides workshops for teachers, has set up a credit union and is attempting to provide social security to its members.

Lastly, the Kiribati branch of the Foundation for the South Pacific is working to address the most pressing concerns of food and water security. Working in partnership with The Outer Island Food and Water Project, it teaches local women and young people gardening techniques and cooking lessons. It also establishes local water points which greatly enhance water security. Thanks to this work, many villagers no longer have to travel long distances for fresh water and one local community has been able to sell extra vegetables for a profit.

Light at the End of the Tunnel

An underdeveloped economy, low food and water security, a developing health care system and an education system with much potential to be improved are among the causes of poverty in Kiribati. Despite these challenges, islanders continue to survive off their land and lead family and community-oriented lives. Organizations like GAVI, the KUT and the Foundation for the South Pacific have recognized the enormous opportunities in Kiribati and are contributing to positive change focused on improving the lives of the remarkable I-Kiribati.

– Spencer Jacobs
Photo: Pixabay

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4 Facts about Poverty in Turkmenistan

Poverty in Turkmenistan
Turkmenistan is a country in the Central Asian region with a population of more than 5.6 million and a coastline along the Caspian Sea between Kazakhstan to the north and Iran to the south. Prior to gaining independence in 1991, Turkmenistan was a Soviet republic.

The country is well-endowed with energy reserves including natural gas and oil, and its economy is highly dependent on energy production and exports. In addition, Turkmenistan is rich in cotton, another highly exported commodity. Although 48.2% of the country’s labor force works in agriculture, this sector represents only about 8% of its GDP. Turkmenistan, moreover, continues to grapple with substantial barriers to economic and political progress, subjecting many of its citizens to poverty and other sources of hardship. Here is some information about poverty in Turkmenistan.

4 Facts About Poverty in Turkmenistan

  1.  Turkmenistan has made significant progress when it comes to poverty reduction. In 1999, an estimated 58% of the population in Turkmenistan was living in poverty compared to 0.2% in 2012. GDP per capita witnessed a similar kind of improvement over the same period. In 1999, GDP per capita in Turkmenistan was only $1,800. That figure increased to $8,900 in 2012, and in 2017, it reached $18,200, earning the country a rank of 97th highest GDP per capita in the world.
  2. Reports have stated that Turkmenistan possesses the world’s fourth-largest reserves of natural gas. However, its heavy reliance on energy exports exposes its economy to sizeable vulnerabilities, including fluctuations in the energy prices. High energy prices in the last decade enabled sensible progress in the form of utility subsidies on the part of the Turkman government since 2014. However, the country’s GDP growth rate has declined to 10.3%, as a result of low energy prices, in 2014 from 14.7% in 2011. In 2015, its GDP growth rate further declined to 6.5%. These setbacks have resulted in cutbacks on government subsidies and infrastructure spending.
  3.  The country’s first political leader, Niyazov, died in 2006 and Berdimuhamedow, who continues to be president today, succeeded him. The reign of Niyazov led to the suppression of political dissent and tightly limited freedom of movement and travel. Moreover, in 2004 and 2005, Turkmenistan’s development experienced a significant hindrance when the government cut one year off of secondary school requirements, replaced 15,000 health care professionals with military conscripts and closed all regional hospitals. Political repression and limited civil freedoms continued under Berdimuhamedow. With a transparency index of 154 among 176 countries, corruption on all levels of government has also been a major obstacle to development in Turkmenistan, limiting its potential for foreign investment opportunities.
  4.  The state has heavily regulated Turkmenistan’s economy. In fact, the state controls an estimated 90% of agricultural production. People also report long waiting queues throughout grocery stores that the state owns or controls. Since Turkmenistan has subsidized food items like bread and considering that Turkmen farmers cannot grow unauthorized products, the country’s economy is far from efficient or self-sufficient. Government control over the foreign exchange rate, thus restricting the private sector’s ability to import the foodstuffs necessary to sustain the population, has further exacerbated this fact.

Looking Ahead

While official estimates for poverty in Turkmenistan are low, at 0.2%, there are several drawbacks that the country faces in regard to both its economy and its social and political standing. These range from the need to diversify its economic model from its heavy reliance on energy export revenues to the promotion of a more free business and investment climate. In the meantime, international cooperation and coordination ought to strive to ensure that the recent food shortages in Turkmenistan do not escalate into a full-fledged hunger crisis.

– Oumaima Jaayfer
Photo: Flickr

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Cryptocurrency in Africa: The Future of a Continent’s Economy

cryptocurrency in AfricaCryptocurrency in Africa has become increasingly popular over the last couple of years, as many people become more interested in the possible economic benefits that can come from the new technology. Cryptocurrency is entirely digital money that uses a decentralized system. As a result, there is not one entity with complete authority over the process. The whole system works over the internet allowing transactions to happen anywhere in the world with no government regulation. Bitcoin, created in 2009, is the leading cryptocurrency company in Africa. There are a variety of users, from individuals to small businesses, that use the technology for investments, banking and payment transfers across borders.

Why Cryptocurrency is So Popular in Africa

In April 2019, Google Trends data showed that Nigeria had the world’s most searches for Bitcoin. Also in 2019, South Africa has the highest volume of cryptocurrency ownership compared to internet users. It was found that 10.7% of internet users in South Africa owned Bitcoin compared to the worldwide average of 5.5%.

In 2020, despite the global economic uncertainties, COVID-19 brought by businesses closing and people not working, Bitcoin trading has continued to increase in Africa. In May 2020, Nigeria had the highest trading volume in one week at $7.2 million, its third-best P2P trading week. Kenya was second with another record week by trading $1.6 million. South Africa came in third exchanging $1.1 million in a week.

Cryptocurrency in Africa mainly gained wide popularity because of high inflation rates across the continent. In 2018, South Sudan saw rates of 83.5% compared to the previous year. Other countries like Nigeria, Ghana and Zimbabwe, who printed $100 trillion notes worth only $40 in 2015, also experienced double-digit inflation rates. These hyperinflation rates had many citizens doubting the economic services of their central banks and governments.

Benefits of Cryptocurrency

In an effort to protect their money from the economic turmoil in their country, Africans started transitioning to Bitcoin. Since companies like Bitcoin have no single domain, the money inside the company is not affected by a single country’s inflation rate, which allows the citizens of African countries to protect their money from a failing economy. As a result, trust for these cryptocurrency companies builds.

Cryptocurrency in African also gives its people the ability to make cross-border payments. Some African countries have a history of fraud which had caused problems with international money transfers. In Nigeria, PayPal banned citizens from receiving money from other nations because of the country’s problems with fraud. However, cryptocurrency allows these citizens to transfer and receive money from anywhere around the world without the high fees that other money transfer companies usually have.

Cryptocurrency companies are blockchain technology that stores public records in a decentralized system. This also makes it impossible to alter transactions and assets. Many African countries use this new technology, through companies like Bitcoin, to elevate their status. They also use this technology to continue pushing their economy up to a level playing field with other nations. In 2019, Kenya and Nigeria announced plans to work more closely with these companies. These countries hope that by regulating cryptocurrency companies and their technology, the governments can begin bringing its people out of immense poverty and start becoming a greater global power.

– George Hashemi 
Photo: Flickr