Archive for category: Global Poverty

Key articles and information on global poverty.

Infrastructure in Ukraine Slowly Becoming Modernized

Ukraine has a history of attempts toward developing its infrastructure that have failed thus far. Infrastructure in Ukraine has great potential, but its development has been delayed for multiple reasons, including mismanagement during Soviet rule and periods of economic instability.

The local energy sector, in particular, is in a poor state. Earlier this year, radical politicians blockaded coal from the unrecognized People’s Republic of Donetsk region of Donbass from delivery to the rest of the country, exacerbating the issue of underdeveloped infrastructure in Ukraine. This threw the country into turmoil, as Ukraine does not have enough resources to serve its power plants without the coal, leading to a downward economic spiral and state of emergency.

Currently, Ukraine is working on modernizing its infrastructure with a focus on making it more energy-efficient. Konstantin Grigorishin, owner of Energy Standard Group and vast assets in the energy sector of Ukraine, stated in an interview with RealClearEnergy, “We should not reconstruct the old infrastructure but introduce complete modernization of the Ukrainian energy system in line with the latest industry trends.”

The World Bank ranks infrastructure in Ukraine at 80 out of 160 countries in its annual Logistics Performance Index. This is mediocre at best, and its transportation systems are out of date with respect to speed, safety, and efficiency. To remedy this issue, Ukraine came out with a plan, Ukraine’s Transport Strategy 2030, that focuses an updating all its internal transportation systems until it is on par with the rest of Europe.

Ukraine is strategically located between the E.U., Russia and the Black Sea, forming a critical point for maritime trade. Its position, and the Dnipro River linking its coast to the interior of the country, makes it uniquely capable of both international and regional trade. The only thing required to make this trade plan possible is a viable route along the Black Sea and the Dnipro River, and this is where issues arise.

Infrastructure in Ukraine requires an investment of at least $2 billion from private investors for maritime trade to be a viable option. To increase investments, the Ministry of Infrastructure intends to establish private-public partnerships (PPPs) with businesses. The Ministry signed a Memorandum of Understanding with the International Finance Corporation (IFC) on November 14, 2017, declaring their intention of mobilizing infrastructure development through PPPs.

The Minister of Infrastructure, Volodymyr Omelyan, has stressed the importance of these partnerships, stating, “Ukraine’s infrastructure needs are enormous. We need to crowd-in private investment to modernize the country’s infrastructure and upgrade it. IFC’s support and technical expertise will help ensure we are implementing the best possible solutions efficiently and transparently.”

Ukraine’s economy is relying on the success of these investments and the jobs they will create. With continued cooperation between the government and the PPPs, the country will steadily overcome its obstacles to infrastructure development.

– Kayla Rafkin

Photo: Flickr

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Reducing Poverty in Southwest China

Poverty in Southwest ChinaSouthwest China is comprised of the provinces of Sichuan, Yunnan and Guizhou, the Chongqing municipality and the Tibet Autonomous Region. While the Chinese government has been making great efforts to reduce poverty in southwest China, in 2016, about 20 million people remain below the poverty line. Tibet, Guizhou and Yunnan rank among the top six poverty rates in China.

Poverty in Southwest China results from several major factors: the development of transportation is relatively slow, communication and technology often fall behind and large areas of mountain and plateau restrict the growth of the economy and education in this region.

Conventional views are aimed at “treating poverty by education.” Hence, the government in impoverished areas tried to get rid of poverty with the aid of intellectual support provided by education. In spite of the severe hardships of financial budgeting, it still did their best to develop education and even at the cost of heavy debts. However, the data suggests that education levels in impoverished areas have not effectively changed the status of poverty even after a large amount of investment.

Nevertheless, there has been progress in the fight against poverty in Southwest China. The Tibet Poverty Alleviation Office announced that last year, 150,000 rural residents rose out of poverty in Tibet. In its thirteenth five-year plan, China aims to help Yunnan, Guizhou and Sichuan to release about one million people from poverty each year. The ultimate goal is to eradicate poverty in Southwest China by 2020.

It is well recognized that improving transportation is a prerequisite for gaining wealth. As part of the thirteenth five-year plan, the city of Chongqing will see the investment of $60 billion toward constructing the transport hub in southwest China. Besides dozens of new projects in other southwest provinces, local governments have also been installing new solar street lamps and water heaters, upgrading roads, houses and cultural activity rooms. Such measures create conditions for the acceleration of economic developments in rural, remote areas in Southwest China.

A further measure is reinforcing vocational education in poor counties and paying more attention to the economic growth and education of ethnic minorities. In the Yunnan province, a project was launched by the World Bank and provincial government in 2012, which was oriented to improve the quality and relevance of technical and vocational education and training, in order to produce skills matching the demand of labor markets.

Nine vocational schools were implemented, where 6,000 teachers and school managers were trained. As a result, more than 24,000 students benefited from training in crucial economic sectors, 80 percent of whom were from poor, rural areas and about 30 percent of whom belonged to ethnic minorities.

In order to achieve the comprehensive alleviation of poverty in Southwest China by 2020, governments and international organizations are working hard with specific, feasible and staged plans toward this goal.

– Xin Gao

                                                   

Technology Boosts Credit Access in Brazil for Small Business

Technology Boosts Credit Access in Brazil for Small BusinessBrazil’s commercial sector is overwhelmingly populated by small businesses. According to a report by SEBRAE, a small business agency of the Brazilian federal government, microenterprises and small businesses, defined as those with less than $1 million in annual revenues, make up 99 percent of the country’s 7 million commercial ventures.

Small businesses have driven tremendous growth in the Brazilian economy in the 21st century, raising millions of Brazilians out of poverty, but these businesses still face numerous difficulties in their daily operations. For example, credit access in Brazil has historically been expensive and difficult to obtain. This poses a challenge for small businesses and sole proprietors wishing to borrow modest amounts to cover inventory or to invest in new ventures.

Among the 20 largest world economies, Brazil has had the highest interest rates for commercial lending in recent decades, and banking fees are similarly high. Brazil’s financial system is highly concentrated, with a few large banks handling the vast majority of assets and transactions.

In recent years, however, new players have entered the market for consumer and small business finance in Brazil. Financial technology (FinTech) firms are making inroads into the largely untapped market for credit access in Brazil and giving many small businesses in the large South American nation new opportunities for growth. A 2017 report by Goldman Sachs noted that the unusually high-interest rates and bank fees in Brazil increase the incentives for upstart financial companies to compete with large established banks. Because of the unusual concentration of banking in just a few small firms, FinTech stands to have a much larger impact by increasing credit access in Brazil than it does in other nations where the financial system is already more diverse.

By September 2017, Brazil had the largest number of operating FinTech startup companies in Latin America, topping even strong growth in Mexico, the region’s next most populous country. NuBank, Brazil’s most visible new financial technology company, has received more than 10 million applications in the past three years for new credit accounts. NuBank offers small business loans as well as personal credit in Brazil and the firm has recently seen growth as fast as 10 percent per month.

Some of the circumstances fueling these changes have been readily apparent on the streets of Rio de Janeiro and other large Brazilian cities for years. In the busiest urban blocks there, dozens of young people chat with each other using Internet-connected smartphones, and strangers exchanging information for the first time often offer a WhatsApp account or Facebook handle instead of a traditional phone number. FinTech firms are taking advantage of this phenomenon by developing a strong mobile presence and enthusiastically engaging with mobile and internet commerce.

Small enterprise is everywhere in Brazil’s large cities as well. Sidewalk kiosks and small local businesses make up the vast majority of retail establishments on every block of Rio’s densely packed downtown and its historical and beachfront neighborhoods. The scene is similar in Salvador and São Paulo, Brazil’s largest and third-largest cities, respectively.

Small business is an essential element to developing the economic potential of Brazil, the world’s sixth most populous country. Expanding employment and commercial opportunities can raise the standard of living for millions of low-income citizens who have not yet been fully helped by Brazil’s robust economic growth in the past few decades. With millions of Brazilians employed by these ubiquitous small businesses and the access to personal capital expanding at a rapid rate, the FinTech revolution in Latin America’s largest economy promises to be a winning story for economic development and poverty reduction for years to come.

– Paul Robertson

Photo: Flickr

Transport Infrastructure in Bosnia and Herzegovina


The infrastructure in Bosnia and Herzegovina has been recovering from the destruction brought by the Bosnian War in 1995 ever since its end. The two main ways of travel, the motorway and the railway, have been and still are the priorities of Bosnia and Herzegovina when reconstructing and rehabilitating after the war. There have been several projects set forth to create safe and business-boosting infrastructure in Bosnia and Herzegovina.

Motorway Transport

Many roadways have been constructed parallel to railways to improve travel times. Corridor Vc is one of the most popular and best ways to travel from big cities like Sarajevo, Zenica and Mostar to the E.U. Recently, there has been a motorway built to lessen the amount of time it takes to travel between these cities.

“It used to take double or even triple the time…when you travel to the north to visit friends and family, it is very convenient” a woman stopping at the toll station told the European Bank for Reconstruction and Development (EBRD).

Between the years of 2007-2011, a Road Infrastructure and Safety Project was put in place to improve traffic conditions, increase road safety and modernize road maintenance procedures. A total of 30 million U.S. dollars were used to finance the rehabilitation of the roadways.

When the Road Infrastructure and Safety Project came to an end in 2011, 61km out of the 241km of road projected to be done had been rehabilitated. Road safety had progressed and the Republika Srpska, a road safety agency, was created to monitor roadway safety. Lastly, a maintenance contract was signed in March 2010 with the Federation of Bosnia and Herzegovina to assist in modernizing road maintenance procedures.

Railway Transport

Since the mountains of Bosnia and Herzegovina are rich with resources like metal, steel and aluminum, it is vital to have proper and heavy duty railways for transportation of these resources. The EBRD contributed 101 million Euros in the early 2000s to build new tracks, reconstruct tunnels and install new signaling systems for the railways.

After the initial contribution, the construction of a better railway boosted business in the country. Heavy industry organizations, such as iron and steel manufacturers, were located along the route and access to their markets became easier.

Based on the Railways of the Federation website, there are 14 core activities that are done to ensure the best railway infrastructure. Included is the organization and management of railway traffic, safety of both passenger and cargo transport, routine maintenance of signaling, telecommunication and contact networks and development of railway regulations.

Also included on the website are tips for passenger and freight traffic for resident travelers and transporters. The traffic indicators let a passenger know what they should expect when taking a train to a different city. For a transporter, there are diagrams that show the tons of goods being transported along the Bosnia and Herzegovina railway.

Transport infrastructure in Bosnia and Herzegovina has been improving each year. Overall, the country has been able to create faster transportation and more efficient means to transport goods in order to increase business.

– Brianna Summ

Photo: Flickr

Infrastructure in Kyrgyzstan

The territory of modern-day Kyrgyzstan was once an important stop on the ancient silk road when brave traders needed to pass through the Tian Shan mountains. Today, many of the routes through the mountain passes remain the same.

Kyrgyzstan is a recovering ex-soviet state with infrastructure dating back to its occupation. Landlocked within the mountain range without many natural resources, international trade is difficult. The country uses the resources it does have to its benefit, the government is on good terms with many of its neighbors and as long as the current government does not follow the suit of former leaders, Kyrgyzstan is set to grow. However, infrastructure in Kyrgyzstan must improve along with its economy.

Traveling throughout Kyrgyzstan, although a challenge, is not impossible. Most travel takes place between its northern and southern regions; in the north, Bishkek, the capital city of Kyrgyzstan is the main destination and in the south, it is Osh, home to one of the oldest bazaars in the world. The capital is home to the nation’s only international airport but because air services do not match the safety specifications of many nations there is not a high demand for international air travel. It is in Bishkek where the main train line runs across the northern border to Kazakhstan.

The railways are the major trade lines in and out of Kyrgyzstan. Many of the roads in the country are not open all year round due to the winter conditions in the mountains. But because 14.9 percent of the economy and 48 percent of the workforce is based on agriculture, the roads are essential since they are the only way for the people to get their goods to a trade hub. The majority of the manufactured goods come from urban industrialized areas. The steep frozen mountains are a blessing and a curse to infrastructure in Kyrgyzstan. The blessing is that 79.4 percent of electricity produced in Kyrgyzstan is hydro-electric. The many rivers and streams that run down from the mountaintops are a perfect environment for generating electricity, cutting down the country’s need to import natural gas and petroleum.

With electricity comes the internet. Currently, around 1.9 million people in Kyrgyzstan use the internet. The number is set to grow over the next decade. With the help of the European Bank for Reconstruction and Development, Kyrgyzstan’s government is working to upgrade its domestic telecommunication systems. Much of the infrastructure in use is dated and left over from Soviet times.

The EBRD is not the only bank interested in improving the infrastructure of Kyrgyzstan. The Asian Development Bank has invested in Kyrgyzstan to help fight poverty and increase the country’s economic growth and sustainability. One way that the ADB is supporting the infrastructure of Kyrgyzstan is by allowing Kyrgyzstan’s entry into the Central Asian Regional Economic Cooperation Program. CAREC consists of 11 countries, their goal is economic growth in the region. The ADB is supporting the construction of three major transportation infrastructure projects in Kyrgyzstan. The projects are three of six corridors linking the CAREC countries to each other and the world. Europe, the Mediterranean Sea and Russia all have three major roads running through Kyrgyzstan.

In time, and with a stable government, infrastructure in Kyrgyzstan will improve and Kyrgyzstan will improve as a whole. Hopefully making access to its beautiful landscapes easier for everyone.

 – Nick DeMarco

Photo: Flickr

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The Importance of Improving Women’s Empowerment in Zambia

women's empowerment in zambia
Zambia is a nation directly above Zimbabwe that has made a concerted effort in the past year to stave off both gender-based violence and child marriage. The nation realizes that in order to enjoy a brighter future, it must educate all members of the household and strive for women’s empowerment in Zambia.

The female Vice President of Zambia, Inonge Wina, made a statement in August of this year wherein she commended the nation for making great strides in not only championing for women’s empowerment in Zambia, but also in taking practical steps in appointing women to positions of leadership.

“However, there is [still a] need to adopt laws in our country and policies that empower women and enhance their leadership roles and equitable participation in governance, politics and in the labor force,” she said.

In 2017, Zambian police recorded 55 gender-based violence (GBV) murder cases, an increase of nearly a quarter compared to 41 recorded in the same period in 2016. There was also a spike in cases of assault, with 1,644 cases recorded this year.

Independent advocacy groups such as the Non-Governmental Organizations Coordinating Council (NGOCC), have been pushing for the implementation of an anti-GBV fund to help survivors. NGOCC executive director Engwase Mwale has also advocated for the full implementation of the “anti-GBV law,” which includes constructing shelters for survivors in the districts.

In response to the increase in gender-based violence, Zambia’s Ministry of Gender launched a strategy aimed at aiding women who have experienced gender-based violence financially.

The Gender-Based Violence Survivors Income Generating Activities Tracking Strategy has already helped to empower 6,500 survivors by providing them with financial opportunities; evidence has shown poverty to be one of the causes spurring gender-based violence.

Lawmakers and government officials in Zambia point to a lack of education as one of the main reasons that gender-based crimes occur so frequently. At the moment, the law in Zambia describes a child as anyone under the age of 16, and allows anyone to marry at the age of 18.

Chief Cooma of the Tonga-speaking people in Zambia’s Choma district, capital of the southern province of Zambia, has taken a strong stance on early marriages. He has warned his subjects against doing so, saying he will not hesitate to have any perpetrator prosecuted by the full power of the law.

Esnart Siandavu of Sikaunzwe, Kazungula, says gender-based violence does not apply only to battery, but in the distribution of resources as well.

“I think gender-based violence is not only when a husband beats his wife. Like here, women are involved in farming while their husbands go drinking. Surprisingly, when it is time to sell the produce to the Food Reserve Agency or private buyers, it is the husbands who take a central role as if we do not know where the FRA depots are. I think it is a violation of our rights because we do not see the money after toiling for the whole farming season,” she said.

Even though women’s empowerment in Zambia is continuing to make strides through education, the patriarchal systems in place still make it difficult for women to take full control of their own financial situations.

– Sam Bramlett

Photo: Flickr

The Path to Improving and Strengthening Credit Access in Albania


Credit helps to improve financial status so that a person can buy homes, get credit cards, and build trust between financial institutions and the consumer. Despite the many benefits to having access to credit, Albania still seems to have a low credit market.

Credit access in Albania is low due mostly in part to a supply-demand mismatch. This means that the creditors in Albania don’t have the products that the people are interested in. As a result of this mismatch, the supplier tends to change their product or becomes forced to go out of business.

Part of the reason why the country’s credit access is in a supply-demand mismatch is because some parts of the country have easy access to credit and a reliable supplier, while poorer parts of Albania do not.

Individual Albanian people’s credit access seems threatened by the lack of borrower awareness and protections, as well as a lack of a functioning credit registry. Without these two things, a person is left vulnerable to financial debt and burden that can last years.

Credit awareness is important because it poses as a financial risk for those who cannot afford it. If one is not careful, they can end up with massive debt. Debt hinders the chances of acquring a house, car, or financing any other prosperous items.

According to the World Bank, while individual access may be threatened, cooperate business account for 74 percent of all credit in Albania and small businesses account for majority of the economic population. Though credit access usually reflects the economic stability of a country, Albania relies heavily on cooperations.

For cooperate companies, credit access is important because credit helps businesses receive the funding they need to succeed financially. According to Cardhub in 2015, the average business needs 12-18 months to improve its business credit score.

By improving credit access in Albania, financial status is sure to improve as a result. Albanian credit access can further smart banking and loaning so that the country can decrease their economic expenses.

– Seriah Sargenton

Photo: Flickr

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McGovern-Dole Food for Education Program in Jeopardy


In Tanzania, Africa, many children struggle just to get a meal. Tanzania has suffered from reoccurring droughts throughout the region that make farming difficult and food scarce. However, since 2002, the McGovern-Dole International Food for Education and Child Nutrition Program has provided school meals of rice and beans for more than 100,000 students a day throughout the country.

With the proper amount of food, the students have more energy and are able to focus on their schoolwork. School attendance rates have increased since the program was installed. The Food for Education program isn’t limited to Tanzania; it has also reached hundreds of thousands of students in Guatemala, Bolivia and Nicaragua. Overall, the program has reached 40 million students in 24 countries.

The McGovern-Dole Food for Education program does more than just provide school lunches. It also plants school gardens, teaches farming techniques, and involves parents in cooking and donating food in order to allow local communities to take responsibility for school meals.

Due to the severe droughts in Tanzania, prices for basic groceries have increased significantly. The droughts have also put a large strain on livestock because of the lack of water and pastures. Maize prices rose by 25 percent in a 12-month period beginning in 2016.

The McGovern-Dole Food for Education program doesn’t limit itself to improving the wellbeing of schoolchildren. It helps families of all stages by offering nutrition programs for pregnant and nursing women, infants and preschoolers. These programs are run by nonprofits and the United Nations World Food Program.

The U.S. budget proposal for the next year has zeroed out the funding for the McGovern-Dole Food for Education program. The meals these students need to thrive in school are now at risk of disappearing, although according to the U.S. Global Leadership Coalition, Congress seems to be leaning toward a rejection of the administration’s proposal.

– Chloe Turner

Photo: Flickr

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Humanitarian Aid to Mongolia During a Weather Crisis


For the past few years, Mongolia has experienced a detrimental cycle of harsh weather conditions that has been termed “dzud.” Winters are defined by temperatures at -40 degrees Celsius or below, and spring shortages of food and water lead to intense loss of livestock. To top matters off, droughts in the summer make everything from vegetation to livestock to families suffer.

Herders predict the loss of their livestock and quickly attempt to sell what they have in the market for profit. They do this in order to save up money for another expected rough winter. However, when many herders try to do the same thing at the same time, the market value of each animal decreases and farmers end up without enough money to survive.

USAID documents that on January 20, 2016, the government of Mongolia officially declared dzud conditions and announced that the country was in need of immediate assistance. Humanitarian aid to Mongolia was vital.

Fortunately, the response was rapid. With help from the Mongolian government, and the United Nations’ Central Emergency Response Fund (CERF) assessed the situation and determined which groups were most vulnerable.

The plan wasn’t designed to put a long-term solution into play that would save Mongolia’s economy, but rather provide the necessary tools and resources to prevent death among thousands during the brutal winter. Basically, CERF provided humanitarian aid to Mongolia in the form of multi-purpose cash assistance for people at risk that allowed them to purchase essentials. In total, the U.N. provided $2.4 million to Mongolia through CERF. These funds bought basic but necessary food items, reproductive health kits for women and food and care for livestock. As a result, approximately 19,076 people received assistance necessary to beat starvation and death.

Without this form of humanitarian aid to Mongolia, thousands could have died or lost loved ones. Aside from saving lives, CERF strengthened the ties between Mongolia and international agencies, both aid and governmental. When countries are in need of assistance, this example in Mongolia shows that the international community is capable of responding rapidly and effectively.

— Caysi Simpson

Photo: Flickr

Rising Tide: Five Development Projects in Djibouti

Rising Tide: Five Development Projects in Djibouti
Djibouti is a small country nestled next to landlocked Ethiopia on the Horn of Africa. It lies on the western bank of the strait between the Red Sea and the Gulf of Aden. Despite its advantageous position, Djibouti is a poor nation: 41 percent of the population is poor; 23 percent live in extreme poverty. Unemployment reaches as high as 39 percent. These dour figures, however, may be on the verge of changing. The government, in conjunction with international partners, has embarked on a bold program of economic revitalization. Here is a sample of five development programs in Djibouti which could bolster its economy.

Ethiopia-Djibouti Railway
Financed by a Chinese bank and staffed by Chinese nationals, this 466 mile long, $3.4 billion transportation corridor has cut down travel times between Djibouti’s Red Sea port and the Ethiopian capital, Addis Ababa, from three days by highway to a mere 12 hours. When first opened in late 2016, the electric trains only carried freight. It has since been opened to passenger traffic as well.

Ethiopia-Djibouti Water Pipeline
This 63-mile long pipeline runs from the Ethiopian town of Hadagalla into the interior of Djibouti, where it is expected to supply safe drinking water to 700,000 residents of Ali-Sabieh, Dikhil, Arta and Djibouti City itself. The Chinese firm CGC Overseas Construction Co. Ltd. laid the pipe itself with approximately $329 million in funding from the Chinese Import-Export Bank.

Renewable Energy
Several international firms have begun developing renewable energy plants in Djibouti. The Swiss-based firm Green Enesys is building a 300MW solar plant in the city of Grand Bara. Following its lead, Canadian corporation SkyPower reached a deal with the government of Djibouti to build a 200MW solar plant at a cost of $440 million. Solar is not the only game in town, either. Shanghai Electric is working on a 60MW wind farm as well.

Refined Petroleum Product Pipeline
In contrast to the renewable energy investments in Djibouti, a 342-mile long pipeline will form yet another link between Djibouti and Ethiopia. Scheduled for completion in 2018, the pipeline will connect the central Ethiopian city of Awash to ports in Djibouti and is expected to move 240,000 barrels of petroleum products per day. This pipeline, along with another planned to deliver liquefied natural gas, could help establish Djibouti as a major shipping hub for export goods from the African interior.

Djibouti City Multipurpose Port
Perhaps the centerpiece of the government’s plan for economic growth and most important of these five development projects in Djibouti, the multipurpose port under construction in Djibouti City may allow the country on the shore of the Bab-el-Mandeb Strait to develop into a major transshipment hub for its region. In large part financed by China, this modern port facility will ultimately cost $590 million and facilitate both the import of goods from around the world and the export of petroleum and natural gas products from Ethiopia.

While the ultimate effect of these five development projects in Djibouti remains to be seen, particularly in terms of new jobs and opportunities for the unemployed or impoverished, early economic indicators are favorable. In 2016, Djibouti’s economy grew by 6.5 percent; projections for 2017-2019 run as high as seven percent growth. This new growth, driven by foreign investment in major capital projects, may yet improve the lives of many in Djibouti.

— Joel Dishman

Photo: Flickr