Archive for category: Global Poverty

Key articles and information on global poverty.

BRICS Advance Plans for Development Bank

BRICS Advance Plans for Development Bank
The BRICS countries met in Durban, South Africa last week to finalize plans for the establishment of a New Development Bank that would be led by the quickly developing countries. While the negotiations were not finalized and a plan wasn’t cemented, officials claim that progress is being made.

The BRICS are a group of large, quickly industrializing countries; Brazil, Russia, India, China and South Africa. Early last year they made the announcement that they would consider creating a separate development bank run by the leaders of the developing world for the developing world.

While South Africa’s Minister of Finance stated that the negotiations had been completed the day before the meeting, they apparently were not. However, they say that progress was made and that the New Development Bank will be established soon and that they are pleased with the rapid materialization of a concept that only came into their discussions one year ago.

One of the issues remaining is where the central bank will be built, as each country would obviously like to have such a large institution and the profit and recognition that would come along with it. In response to significant pressure from activist groups and student and humanitarian groups, representatives of the five countries made statements condemning the abuse of humanitarian rights in Syria and pleaded that aid workers and organizations be allowed to freely access the region to provide help for those suffering.

– Kevin Sullivan

Source: Voice of America
Photo: Post

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New Vaccine Aimed at Preventing Endemic

New Vaccine Aimed at Preventing Endemic
Throughout many developing nations, foot and mouth disease is considered an endemic in livestock; especially in Asia, Africa, and parts of South America. Previously, the only vaccines for foot and mouth disease were very fragile and had to be created inexpensive labs with the proper equipment, and needed to be kept refrigerated in order to stay “alive,” preventing possibilities of any long-distance transportation.

Now, researchers have created a synthetic version of the foot and mouth vaccine that does not require refrigeration, making it much more accessible to rural areas where the disease is common. The new vaccine can be transported and even created in developing countries since it can withstand varying temperatures.

Within the last few years, the UK, South Korea, and Japan were all victims of an outbreak of the virus that had originated in Asia. The foot and mouth outbreak in the UK cost the country an estimated 8 billion pounds.

The researchers’ goal of having the foot and mouth vaccine distributed globally in order to stop the virus at the source instead of waiting for an outbreak will now be much more practical with this synthetic version. Scientists say that the new version could be widely available within 6 to 8 years. Researchers are also working on synthetic vaccines for diseases that affect human populations, including polio and human hand, foot, and mouth disease.

– Christina Kindlon

Source: Guardian

The Unequal Reality

The Unequal RealityThe next global development agenda has been set. The President of Indonesia, Susilo Bambang Yudhoyono, hosted the meeting to determine such an agenda; he also served as the co-chairman to the UN High-Level Panel for the post-2015 plan with an emphasis on eradicating extreme poverty. Despite the general success of the UN Millennium Development Goals which includes pulling people out of poverty since the 1990s, an increasing number of children are attending schools, and much fewer children are dying due to curable causes: “political will and commitment can bring about real change.”

The issue is that the majority of these successes are happening on the surface, on the “aggregate” levels as opposed to on the extremely low levels. A report done by Save the Children evinces the hidden inequality behind improvements arguing that only wealthier parts have been directly affected by these successes. For example, rich women in Indonesia now have a skilled attendant; however, between 2007 and 2010, children in poorer households continued to experience severe malnutrition despite overall nutrition improvements.

“Aggregate targets” are dictating such unequal distribution of improvement vs. worsening because governments are naturally choosing to aid and invest in what is easier to help; “this means that those close to the poverty line experience improvements while the very poorest are left behind.” Children are the most vulnerable group affected by such inequality because they are dependent on others for development and growth. Therefore, price increases affect their meal intakes, health budget cuts could cause deaths, and low-quality schools have the potential of keeping these children in poverty. In order to fight off inequality, there is a need for quality services such as availability and equal access to schools and health facilities to all kinds of people.

– Leen Abdallah

Source: South China Morning Post

Emily Oster’s Ted Talk on AIDS in Africa

Emily Oster
Emily Oster, a University of Chicago economist, uses the dismal science to rethink conventional wisdom, from her Harvard doctoral thesis that took on famed economist Amartya Sen to her recent work debunking assumptions on HIV prevalence in Africa.

Emily Oster re-examines the stats on AIDS in Africa from an economic perspective and reaches a stunning conclusion: Everything we know about the spread of HIV on the continent is wrong.

She brought up an opinion that more exports means more AIDS and that effect is really big, by testing new data and information about prevalence over time. The data that Emily Oster offers suggests that if you double export volume, it will lead to a quadrupling of the new HIV infection. And this has important implications both for forecasting and for policy. From a forecasting perspective, if we know where trade is likely to change, we can actually think about which areas are likely to be heavily infected with HIV and we can go and try to deploy pre-emptive preventive measures there. Likewise, as we are developing policies to try to encourage exports, if we know there is this externality, we can think about what the right kinds of policies are.
But it also tells us that even though poverty is linked to AIDS in the sense that Africa is poor and they have a lot of AIDS, it is not necessarily the case that impoving poverty in the very short run is going to lead a decline in HIV prevalence.

And she also questioned the HIV prevention case in Uganda, the only country in Sub-Saharan Africa with successful prevention. It is true that there was a decline in prevalence in Uganda in 1990s and they had an education campaign for it. But there was actually something else that happened in Uganda in that period. Their exports went down a lot in the early 1990s and actually that decline lines up really closely to HIV infections at that time, according to Emily Oster.

– Caiqing Jin (Kelly)

Source:Ted Talk
Photo:Flickr

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Disabilities are Key in Tackling Global Poverty

Poverty_Disabled
The UN’s Millennium Development Goals (MDGs) laid out a number of goals in tackling global poverty by 2015 but left a glaring omission in the equation to aid the world’s poor: serving those who are disabled.

Nearly 70% of the world’s disabled population resides in developing countries, and the World Health Organization (WHO) estimates that 575 million of those disabled live below the poverty threshold. Preventable diseases, such as polio and measles, that are not treated properly in poor and developing countries leave a high number of the population with lifelong disabilities.

Other conditions, such as civil war, lack of health care, and malnutrition also contribute to the problem. In developing nations, a disability is “often seen as a curse, the result of bad luck or witchcraft.” Because of this, disabled individuals and even their families are often shunned from the social community and are left without means to support themselves, and lack access to education and healthcare. In the worst cases, disabled people are left to die.

Although the MDGs include many aid programs with worthy recipients, the disabled population is completely left out although they are some of those who suffer the most. This crucial omission means that this large demographic is left out of specific aid programs. For example, many school-aged children have benefited from MDG education initiatives – but what about the 61 million children who still lack access to education, a majority of whom are disabled?

The UN has somewhat recognized this with the United Nations Convention on the Rights of Persons with Disabilities in 2008. It will be most important for development leaders, when evaluating post-2015 development goals, to include disabled people throughout the developing world in their plans and programs.

– Christina Kindlon

Source: The Guardian

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Foreign Aid Creates Jobs in the US

Foreign_Aid_Job_Creation_USAID
There are many disputing ideas on whether or not America should continue to invest in foreign aid, especially while in the throes of an economic recession. While spending US funds to support countries and people that most citizens will probably never visit or meet may seem counter-intuitive, foreign aid will be a factor in pulling America out of its recession. Lifting developing countries out of poverty creates more customers to buy American products, which in turn creates jobs in America.

Foreign aid job creation is not merely speculation. Currently almost half of US exports go to developing countries and this number can be expected to increase as these new, developing markets continue to open. This will greatly improve the US economy since one in five American jobs, like cell phone chips and food production, are export-based. American businesses recognize the opportunity to grow by alleviating world poverty. In 2012, over 50 US corporations delivered a letter to Congress in support of continuing funding for foreign investment. These corporations included Google, Cisco, Coca Cola, Johnson & Johnson and Caterpillar.

These corporations are aware of the huge potential payoffs of foreign investment. For example, the US has given Mexico $1.7 billion in aid over the past 45 years and now exports $16.3 billion in goods to their neighbor every year. The US has also seen its investment in Brazil offer an enormous return. America exports $35.4 billion annually to Brazil after giving $2.8 billion in aid from 1960-2005. Given that a majority of the United States’ top trading partners had previously accepted aid from the US, it is obvious that foreign aid is a good investment.

Foreign aid does not have to be strictly a question of moral obligation; it is also financially and developmentally smart. Many Congressmen are now referring to foreign aid as investment for this very reason. It may take many years until US citizens see the financial benefits of foreign investments but the eventually, revenues from these new markets will be well worth the wait. Foreign aid is less than 1% of United States’ budget and has the potential to create jobs to bring the US out of rough economic times. Contact your Congressional representatives and ask them to support funding for foreign aid.

– Mary Penn

Source: Orange County Register
Photo: Soda Head

Madagascar’s Millennium Village is Independent

Madagascar's Millennium Village is Independent
Madagascar’s Millennium Village, Sambaina, is functioning independently after five years of support and development from the UN Development Program and the Millennium Villages Project. With a donor investment of $400,000 per year, or just $50 per person per year, living conditions have improved dramatically.

The country of Madagascar has suffered in the last five years as a result of political upheaval. Following a coup in 2009, foreign aid to the country has remained frozen, and the government does not have sufficient funds for social programs or the salaries of civil servants. In the commune of Sambaina, where over 60 percent of the population was living in extreme poverty when the project began, residents say that their lives have improved.

Targeted investments in the areas of agriculture, education, sanitation, health care, infrastructure, technology, and local business have made a world of difference in Madagascar’s Millennium Village. Implementing the System of Rice Intensification (SRI) has helped farmers increase yields to the point of achieving food security for eleven months out of the year. Previously, their harvests only lasted three months. About 70 percent of Sambaina farmers now use the SRI method, and have seen sustainably increased rice production.

Pumps have ensured access to clean drinking water, while health education has encouraged people to maintain good hygiene and utilize the village’s health care facilities. Other investments include computers in classrooms, renovations in schools and infrastructure, and funding to start-up businesses.

Now that initial investments have been made in developing Sambaina’s basic necessities, the villagers will be responsible for maintaining them. To this end, committees have been established, which will collect contributions from residents to fund maintenance projects.

The success of Madagascar’s Millennium Village is undeniable. Even in a country with almost no economic growth and four years of political crisis, targeted investment and development assistance has nearly eliminated extreme poverty in Sambaina within just five years. The country of Madagascar has no hope of achieving the Millennium Development Goals by 2015. But Madagascar’s Millennium Village Project in Sambaina proves that foreign aid, when responsibly managed, is instrumental in improving the lives of the world’s poor.

– Kat Henrichs

Source: IRIN

A Gift from Madrid to Reduce Poverty

A Gift from Madrid to Reduce PovertyLast month, 400 International MBA students from the IE Business School in Madrid went to Pakistan to work on the “LettuceBee Kids” project, a “social enterprise aiming to provide a self-sufficient mechanism of survival to street children.” The IE Business program challenges its International MBA class by exposing students to extreme poverty-stricken areas and countries where they get to participate first-hand in poverty projects. Within the program, the Change in Action (CIA) module was formed in 2008 as a part of the International MBA agenda to fight global problems.

It was challenging to take a diverse group of 400 of the top students in the program from Madrid to reduce poverty in Pakistan, having them brainstorm sustainable solutions for street children in Islamabad in just five days while they did not know much about the country in the first place. Professor Todd Lombardo brought to the table the design thinking concept – which is composed of six stages: understand, observe, synthesize, ideate, prototype, and test – to help the students come up with innovative solutions.

The author of the article, Saad Khan, urges “elite institutions” to get their students to be involved in similar projects and programs. Exposure to extreme poverty not only creates awareness among those who are not directly affected by it, but it allows for an acknowledgment of the costs of capitalism, the lack of business models which are value-based, and extreme disparities in income between the haves and have-nots. Additionally, Khan believes that foreign policies should be tweaked to better address problems of poorer nations, which in turn would help prevent and tackle terrorism.

– Leen Abdallah

Source: The Tribune

Social Enterprise Helping India’s Salt Harvesters

Social Enterprise Helping India's Salt Harvesters
Sabras, a social enterprise organization based in India, is using micro-lending to help the country’s poverty-stricken salt workers gain freedom from predatory lenders and non-cooperative banks.

In the state of Gujarat, where nearly 70% of India’s salt is sourced from, self-employed salt pan workers are subject to harsh physical conditions as well as predatory loans leading to little profit. Temperatures reach harsh highs in summer and lows during winter, causing adverse health effects for workers. Since the workers are self-employed, a majority of them need to borrow money from lenders who fix the price of the salt much lower than it normally would be, cutting profits for the salt pan workers down to nearly nothing, most often just 1% of the market value. Most of the banks in the country are not willing to lend to poor people, leaving the workers without options.

Rajesh Shah, the founder of Sabras, recognized these hardships and created an organization that is not only for the poor but mostly owned and operated by the poor as well, with workers holding nearly 74% of shares in the company. Before there was an alternative lender like Sabras, workers were forced to take out loans with interest rates as high as 48%. Sabras’ interest rates are just 12.5% with the ability to purchase advanced solar pumps that allow workers to increase output over the long run.

Sabras has already made a large impact as nearly 70,000 people are employed in the salt industry in Gujarat. Shah contends that the company’s 400 shareholders have seen a profit increase of 400% within the last two years since they used Sabras loans to purchase the solar pumps.

Looking ahead, Sabras hopes to begin including women in the salt industry’s processes in order to increase profits and improve the quality of life for them as well.

– Christina Kindlon

Source: The Guardian

Euvin Naidoo TED Talk on Investing in Africa

Euvin Naidoo TED Talk on Investing in Africa
As president of the South African Chamber of Commerce – America, Euvin Naidoo works with leading corporations and governments to strengthen trans-Atlantic economic ties. In his Ted Talk, Euvin Naidoo focused on “Africa: the next chapter”. To separate the rhetoric from the reality and the fact from the fiction; to go to the actual data and statistics that exist about the actual things happening in Africa that make this continent a realistic investment opportunity and an option for all around the world.

He stated that investing in Africa is a broad term. Africa is not a country; it is made up of 53 different countries. And every country in Africa has a unique value proposition. You can win money here, and you can also lose money here.

Starting the talk about an investment opportunity, as a banker, Euvin Naidoo mentioned some macro-factors. The first sign is that Inflation is coming down across Africa while reaching double-digit figures in many other countries; he called it “Z.E.N. cluster”.

Zambia from 2004 to 2006 has moved from 18 percent in inflation to 9 percent; Egypt from 16 percent to about 8.4 percent; Nigeria from 16 percent to 8 percent – all in single digits. More fascinating, you have other countries, like South Africa, Mauritius, Namibia, which are also in single digits. And this is just part of the story.

Then he gave specific examples from some countries to illustrate his research.

Instead of focusing on South Africa’s gold, minerals, and its first infrastructure, Euvin Naidoo mentioned other important aspects. South Africa was recently voted as the top destination for the top 1000 UK companies for offshore call-centers. They have the same language, timeline, et cetera. Other big names that had reached Africa were Bain Capital and KKR, the big companies of private equity. Bain Capital’s acquisition of Edcon, a large retailer, is testimony to the confidence these famous names are beginning to place in the economy in what is going to be a long-term play.

Nigeria is clearly a hot spot. The new report, issued by Goldman Sachs, highlighted that, by 2020, Nigeria is going to be among the top 10 economies in the world. And also, without any sovereign backing, Nigerian companies are raising capital offshore.

In the oil industry, Africa provides 18 percent of the U.S.’s oil supply, while the Middle East offers just 16 percent. So, Africa can be an important strategic partner to America.

Finally, Naidoo concluded with Africa’s important position in the world economy because of its investment potential.

– Caiqing Jin (Kelly)

source: Ted Talk
Photo: WhiteAfrica