Information and stories about poverty reduction.

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How Collaborative Efforts Can Address Global Poverty

Collaborative EffortsGlobal poverty remains one of the most pressing challenges humanity is facing. Despite significant advancements in technology, economics and social systems, a considerable portion of the world’s population still lives in extreme poverty. Addressing this complex issue requires a multifaceted approach that goes beyond traditional methods. One promising approach is the power of collaborative efforts. By bringing together governments, NGOs, businesses and individuals, there is a good chance of working out a comprehensive fabric of solutions to resolve global poverty.

The Interwoven Nature of Global Poverty

Global poverty is a multi-dimensional challenge that transcends geographical and cultural boundaries. It encompasses economic hardship and social, political and environmental factors. The intricate interplay of these elements calls for a coordinated response and collaborative efforts that can address the root causes rather than just the symptoms.

The Role of Collaborative Efforts

Collaboration offers a unique advantage in tackling global poverty. It leverages the diverse strengths of different stakeholders and encourages holistic solutions. Governments can provide policy frameworks, resources and infrastructure. Non-governmental organizations (NGOs) can bring grassroots knowledge, community engagement and targeted interventions. Businesses can contribute by investing in sustainable development, job creation and responsible practices. Lastly, individuals can also play a vital role through activism, philanthropy and consumer choices.

Case Studies in Collaborative Success

The United Nations Sustainable Development Goals (SDGs): A prime example of global collaboration, the SDGs outline 17 goals aimed at addressing various aspects of poverty, including education, health, gender equality and clean water. Governments, NGOs, businesses and individuals worldwide are working collectively to achieve these goals by 2030.

  • Microfinance and Social Enterprises – Collaborative efforts between financial institutions, NGOs and local communities have led to the development of microfinance initiatives and social enterprises. These empower individuals in poverty by providing access to credit, training and resources to start small businesses and improve their livelihoods.
  • Public-Private Partnerships – Collaborations between governments and businesses have been successful in developing essential infrastructure in underserved regions. This includes initiatives for clean energy, health care and education, which directly impact poverty reduction.
  • Challenges and Considerations – Collaborative efforts are not without challenges. Differences in priorities, communication barriers and unequal power dynamics can hinder progress. It is crucial to establish transparent communication channels, clear objectives and equitable distribution of resources to ensure that collaborative initiatives yield meaningful results.

Looking Ahead

Global poverty is a serious challenge, but it is not insurmountable. Collaborative efforts hold the potential to work out the required solutions. By harnessing the collective strength of governments, NGOs, businesses and individuals, there is hope for mending the gaps in the social fabric, uplifting disadvantaged communities and creating a world where every individual has the opportunity to thrive.

– Sudipta Barua Munmun
Photo: Pexels

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The Benefits of Impact Investing in Education for Poverty Alleviation

Investing in EducationImpact investing is an investment strategy employed by individuals, companies or organizations seeking both financial returns and a positive social or environmental impact. This approach, when applied to education, could yield substantial benefits for individuals and developing countries alike. Education has the potential to enhance various facets of an economy, including health, empowerment and employment, as highlighted by EHL Insights. For instance, research suggests that achieving universal education, where every child acquires basic literacy skills, could reduce the number of individuals living in poverty by an estimated 170 million.

Reducing the Funding Gap

The private sector can significantly assist governments in developing countries in closing the funding gap and providing access to quality education for all children in these nations. This support is crucial as many developing countries face challenges in securing the financial resources required for universal basic education of high quality.

According to LEK Consulting, developing countries will need an expenditure of $3 trillion on education to provide “universal access to education” by 2030, which aligns with the sustainable development goals (SDG). This is more than double the 2020 expenditure of $1.2 trillion. The benefits of impact investing in education from the private sector can potentially fill in the gaps where government funding is absent or limited – improving issues of low access to education and low learning outcomes, both of which have implications for poverty alleviation in developing countries.

Impact Investing Improves Access to Education

Hewlett-Packard (HP) launched HP School Cloud, an open learning platform, in 2018 to help improve access to education via a $20 million investment. HP school clouds allow access to educational materials such as e-textbooks and thousands of lessons in STEM subjects like science and math without the need for the internet, allowing equitable access to education worldwide, particularly helping the most marginalized in society. The resources are aligned with an international curriculum standard set by UNESCO and OECD to name a few, with the aim of improving education for 100 million people by 2025. HP School Cloud is an important tool for accessing education. Ron Coughlin, President of Personal Systems Business at HP, states, “HP School Cloud ensures today’s aspiring students develop the skills for the jobs of tomorrow.”

Education is still the primary way for people to escape cyclical poverty in developing countries. Therefore, impact investing can help to improve access to education and help promote a better future by increasing employment status, generational wealth and income and wealth creation. The World Bank states that globally for every year of schooling, there is a “9% increase in hourly earnings.” This increase in earnings in turn contributes to the economic growth of a country. No country with adult literacy rates below 40% achieves rapid growth, demonstrating the importance of access to education for poverty alleviation.

Impact Investing Improves Learning Outcomes

The Union Bank of Switzerland (UBS) Optimus Foundation created the first Development Impact Bond (DIB) in education, Educate Girls DIB, in 2015 to increase the enrolment of marginalized girls and progress and improve literacy and numeracy among children who attended school, in the Indian State of Rajasthan. The DIB lasted three years until 2018. At the end of the program, the learning outcomes of enrollees “grew 79% more than their peers in other schools,” according to the Educate Girls Foundation. That is equivalent to an additional year of education.

Children need foundational knowledge that they learn in school to help them develop as individuals and thrive when they join the workforce. Improving low learning outcomes, particularly for women, can help build prosperous and healthy families. The benefits of impact investing in education in developing countries are likely to reduce children’s malnutrition by 50%, reduce the chances of children dying before the age of 5 and reduce their chances of turning to prostitution as a source of income, consequently reducing levels of HIV infection within a country.

Impact investing in education can help reduce poverty within developing countries by providing large amounts of funding in places where government resources are spread thin. Education is important for reducing poverty. Education increases economic growth and individual earnings, which benefit families and wider society. Furthermore, investing in education, particularly for women, leads to better health outcomes creating a healthier society.

– Kishan Patel
Photo: Flickr

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Tourism Boosts Lebanon’s Economy Amid Summer Revival

Lebanon's Economy
Lebanon’s economy experienced a remarkable upswing this summer, thanks to the revival of tourism in the country. The tourism sector has emerged and has always been a pivotal player, breathing new life into the nation’s financial prospects and increasing the potential for poverty reduction in Lebanon.

Increased Tourism in Lebanon

Efforts to implement security measures in the region have cultivated a modest sense of confidence among travelers, drawing a heightened influx of international visitors to Lebanon. Expert estimates and statements from tourism authorities substantiate the sector’s expansion, resulting in amplified tourism receipts and economic advantages.

Local businesses, encompassing hotels, restaurants and transportation services, flourish by attending to the increasing count of tourists exploring Lebanon’s rich cultural heritage, historical landmarks and breathtaking natural landscapes. This influx of visitors has also resulted in job creation, further contributing to economic growth and poverty reduction among locals. This is significant considering a report by Human Rights Watch in 2022 that 36% of people in Lebanon lived in extreme poverty.

Insights from Jean Abboud, president of the Association of Travel & Tourist Agents in Lebanon, reveal that Beirut’s International Airport has witnessed a notable surge in travelers. This trend has remained consistent since the end of June, with passenger numbers averaging between 15,000 and 18,000 individuals daily. Particularly noteworthy is the peak occurring on June 25, when the airport’s terminals bustled with 20,000 passengers in a single day.

This surge in passenger traffic paints a vivid picture of Beirut reclaiming its popularity and appeal on the global travel stage. The numbers indicate a renewed preference for Beirut as a favored entry point, reigniting the city’s role as a hub of international connections. By facilitating the smooth movement of people across borders, Beirut’s airport takes on a pivotal role in revitalizing the local tourism and travel sector. This sector holds immense significance for the nation’s economy and cultural exchanges.

How Tourism is Boosting Lebanon’s Economic State

In 2022, Walid Nassar, serving as the minister of tourism in a caretaker capacity, presented data revealing that Lebanon welcomed more than 1.72 million visitors during the previous summer, contributing a significant $5 billion through their collective expenditures. At a conference held in Dubai in May, Nassar projected that the upcoming year would see an even more substantial influx of tourists, primarily during the summer season, with an estimated minimum of 2.2 million visitors. Nassar’s estimations suggest this surge in visitor numbers will play a key role in generating revenue of at least $9 billion for the nation, thereby contributing to poverty reduction in the country.

Tourism’s resurgence has not only bolstered Lebanon’s economy but also extended economic opportunities to various regions, reducing disparities and promoting inclusivity. By attracting visitors to lesser-known areas, local communities benefit from the increased economic activity. To maintain the momentum, it is crucial to prioritize sustainable practices and the preservation of Lebanon’s cultural heritage. This ensures the long-term growth and stability of the tourism industry.

Looking Ahead

Lebanon’s economy experienced a much-needed boost, thanks to the revival of tourism during the summer months. The increased number of visitors has had a positive impact on various sectors, leading to economic growth and job creation. However, sustaining this growth requires continued investments in tourism infrastructure and the promotion of sustainable practices. As Lebanon embraces this summer revival, it has the potential to create a more stable and prosperous future for its citizens and communities, further solidifying its position as a favored destination on the global tourism map.

– Kassem Choukini
Photo: Wikipedia Commons

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How African Tourism Reduces Poverty

African tourism reduces poverty
While seeing the beautiful wildlife and environment of Africa, tourists can also boost the economy and aid the country in its fight against poverty. Tourists can do this by simply continuing to visit the country, as it has been shown not only that African tourism reduces poverty in its Sub-Saharan countries, but also helps to build roads and schools and overall enhances the communities in the area.

Each year, millions of people visit Africa to experience both its culture and its beauty. Because of this, countries in Africa have created a thriving hotel and travel industry, creating numerous jobs and boosting the economy as a whole. Many of the more common tourist spots, like the islands Seychelles and Cape Verde, had an average of 16% of all employees in the countries working jobs directly linked to tourism, and this does not include all of the restaurants, shops, etc. that tourists frequently visit.

The Sub-Saharan districts of Africa have seen such rapid growth in their economies as a result of tourism that nonprofit organizations have been created to support this tourism. The Fair Train in Tourism South Africa organization was created to promote tourism in all of the Sub-Saharan countries but focused most specifically on South Africa. The nonprofit researches ways for tourists to sustainably visit the country and ensures that tourists practice fair purchasing, fair treatment to locals and respect the culture and environment that they are visiting. This nonprofit and the Fair Trade in Tourism organization as a whole also support the countries in various ways, like pushing for fair wages and working conditions within the tourism industry and ensuring that the businesses are run ethically and safely.

The tourism industry has become such an integral part of the economy in these Sub-Saharan regions that their governments are actively including the tourism industry in their government plans for the future. A meeting of UNCTAD, or the United Nations Conference Trade and Development, determined that 49 countries in Africa have created plans to boost the tourism industry even further.

How Has African Tourism Economically Reduced Poverty?

The main way African tourism reduces poverty is through creating jobs. The government’s plans to expand the industry will further the number of jobs that are available and increase the overall flow of money coming from foreign places into the country. This money can then be funneled into things like furthering education, building better road systems, creating cleaner water systems, etc. The jobs that the industry creates are also easy to learn and, mostly, do not require a higher education. Therefore, African tourism reduces poverty specifically among individuals who were not able to pursue their education and may otherwise be unable to find a well-paying job. Many of the people holding these jobs are also women, who make up more than 60% of employees within hotels and travel industries.

Despite the recent hit that the industry took as a result of the COVID-19 pandemic, the industry is expected to return to its previous success which was most recently observed in 2019. Specifically, Morocco, the most traveled country in the Sub-Saharan region of Africa, has seen a huge improvement in its economy due to the jobs that African tourism has brought in. In 2019, it was estimated that about 5% of employment was due to the tourism industry. The entirety of Sub-Saharan Africa has seen more than $30 billion as a result of the tourism industry in 2019 alone, and the numbers should only rise as they have almost continuously done over the past decade.

What Good Has Come from Tourism Thus Far?

So far, citizens in the Sub-Saharan regions of the continent have seen enhanced roads, advanced internet access and higher-quality waste disposal. Because the goal of the tourism industry is to provide a good experience for travelers so that they will return again, businesses focus on creating a comfortable environment for travelers. This comfort expands beyond the various hotels and tourist spots to also be experienced by locals.

Furthermore, because of the tourism industry and the money it brings in, the government has also built up communities and has been able to fund public organizations that help the local people. More than 700 community projects have been put in place throughout the Sub-Saharan region that have provided housing and improved both schools and medical clinics, and the effect is only continuing to spread.

– Allison Groves
Photo: Flickr

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Sustainable Development Goals (SDGs) and Poverty Reduction in South Africa

Poverty Reduction in South AfricaIn 2015, all United Nations (U.N.) members adopted the 2030 Agenda for Sustainable Development, which outlines 17 Goals in an urgent call to action by all states. The primary focus was on poverty reduction, sustainability, hygiene education and quality education. In 2019, the South African government finalized the U.N.’s Sustainable Development Cooperation Framework for 2020-25, which includes a multidisciplinary approach to tackling poverty in South Africa through consultation with civil society, academia, the private sector and others.

No Poverty

Goal 1, No Poverty, is a priority for many nations because of its pressing nature. Goal 1 includes eradicating all extreme poverty, to ensure people are living on at least $1.25, the benchmark, per day. In South Africa, there has been concern, as elsewhere in the continent, that the COVID-19 pandemic has pushed more people into poverty and has created more inequality between the rich and the poor.

The World Bank estimates that poverty in South Africa was 63% in 2022, based on the upper-middle-income country poverty line. Severe electricity shortages caused by ‘power rationing’ by the government of up to nine hours per day have also impacted and halted the economy since many sectors such as IT, water and service delivery cannot function. Alongside this, South Africa’s history of Apartheid still lingers today through inequality and poverty. For example, the 2020 multidimensional poverty report by UNICEF revealed that Black children were almost seven times more likely to live in poverty.

Taking Action

The South African government has taken some steps toward poverty reduction in South Africa. In 2012, the government adopted Vision 2030, a National Development Plan (NDP) aiming to eliminate poverty and reduce inequality by 2030. In the NDP, 74% of the SDG targets are directly addressed, showing a good alignment of the plan in tackling poverty in South Africa.

Focus areas of the National Development Plan included poverty reduction in South Africa, alongside the creation of employment and sustainability. The government administered financial assistance to around 17 million people, including grants to pensions, child support, disability and more, within the NDP. Despite these attempts, poverty continues to persist.

The Intervention of Charity Organizations

Charities have also been extremely important in realizing and helping to implement the SDGs. The Borgen Project spoke with Iris Salemi, an International Intern for the charity Where Rainbows Meet, who spent a month working in South Africa and witnessing first-hand the impact of poverty. Where Rainbows Meet provides weekly computer, sewing, gardening and business lessons, alongside CV and child education workshops to increase the employability of young people in the Vrygrond area in Cape Town. Daily power cuts have hindered the ability of charities such as Where Rainbows Meet to carry out crucial work that impacts poverty reduction in South Africa. For example, charities cannot provide computers during power cuts, the kitchen is out of use and the education programs cannot happen without electrical power. For Iris, charities need more government support in order to fight unemployment in a community-based manner.

Other charities also operate and work to reduce poverty in South Africa with the SDGs in mind. These include Nkosi’s Haven, which supports HIV-infected mothers and children through residential and holistic care and provides education to affected communities. For example, it developed Nkosi’s Haven Village, a 2.5-acre plot of land south of Johannesburg that accommodates 22 mothers and 121 children. Operation Hunger also operates in the country and provides food parcels all over South Africa for the most vulnerable. While these are just a few examples, they show the meaningful and crucial ongoing work to address poverty-related issues in South Africa in line with the SDGs.

The Interlinkage of the SDGs

The connection and overlapping of the SDGs are extremely important in addressing multidimensional poverty. For example, quality education (Goal 4) is linked to reducing poverty (Goal 1), as is decent work (Goal 8) and reduced inequalities (Goal 10). Salemi outlined this during her work in the Vrygrond community, saying that “tackling youth education is, as I see it, the most effective way to fight poverty”.

In South Africa, the 2020 multidimensional poverty report revealed that, as of 2021, 50% of individuals aged 15 to 24 were without employment. In her research, Salemi discovered that many individuals grappled with issues related to self-confidence, belief in their abilities and a lack of understanding about what constitutes success. For instance, some young learners struggled to discern the value of education, while others found themselves drawn into negative influences such as gangs. Additional factors contributing to this predicament encompass subpar educational opportunities and skill development, insufficient career guidance within educational institutions and the financial burdens associated with job-seeking, particularly for those residing in rural regions.

Where Rainbows Meet set up workshops in order to help more young people realize their ambitions and see their own value. With better work opportunities and quality education, there is hope for achieving poverty reduction. The role of the government and the work local charities do are consequently imperative in helping South Africa achieve the SDGs.

Taytin’s Experience

The interlinkage of the SDGs is shown in the case of Taytin, whom Iris met during her internship. Coming from a family engaged in drugs and gangs, Taytin’s only option to avoid engagement in this was the street, where he, his brother and father spent all of Taytin’s childhood. Taytin went to Where Rainbows Meet and is now a computer teacher at the charity, and Iris states, “he has helped so many kids and so many adults find a brighter path.” This personal story allows one to observe the importance of achieving the SDGs, all of which influence each other.

Looking Ahead

The pursuit of the U.N.’s 2030 Agenda for Sustainable Development is a complex and urgent task. Exacerbated by the pandemic, its historical inequalities and electricity shortages, South Africa faces challenges in reducing poverty. Charities have made meaningful and impactful strides toward addressing poverty-related issues, in line with the SDGs. In addressing poverty and implementing the framework necessary for its alleviation, South Africa can work toward meeting many of the other SDGs simultaneously, as underscored by the work of charities in the country.

– Rosie Lyons
Photo: Flickr

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Poverty Reduction Progress Worldwide

Poverty Reduction WorldwideYearly, the United Nations’ Global Multidimensional Poverty Index (MPI) provides necessary insight into the state of poverty worldwide. The three dimensions of the MPI are health, education and nutrition, taking into account various statistics and information related to each factor. The MPI provides insight into what is contributing to multidimensional poverty in various countries as well as which countries are facing the worst poverty crises. However, 2023’s MPI also revealed some important and encouraging information regarding poverty reduction worldwide. While 1.1 billion people still live in poverty, over the course of the last 15 years, 25 countries have halved their levels of multidimensional poverty. 

Where Poverty Is Declining

While poverty reduction has been seen in countries throughout the globe, many of the most successful countries have been located in Asia. In India, 415 million people have exited poverty over the last 15 years, equating to just more than 6% of the world’s population. In China, 69 million have exited poverty, and in Indonesia, another 8 million people have exited poverty. Additionally, Cambodia has slashed the number of people living in poverty in half over the last seven years.

And yet, while many have left poverty in these countries, an overwhelming majority of the world’s poor live in Asia or Sub-Saharan Africa. In fact, according to the U.N., roughly five out of every six persons living in poverty are from those two regions of the world. However, that also means that these countries can look towards their neighbors for examples of how to implement successful policies aimed at poverty reduction worldwide. Each successful country has implemented programs aimed at the various dimensions of the U.N.’s Global Multidimensional Poverty Index.

India

India experienced a dramatic decrease in a variety of dimensions of poverty over the past 15 years. Notably, the lack of access to electricity fell from 29% of the population to just 2%. Child mortality was also slashed in half, from 4% to 2%. India has increased access to health care for millions of people over these years, much of it through the Ayushman Bharat National Health Protection Scheme.

Through the Ayushman Bharat, India aims to improve health care access for many poor, rural and urban families. According to the Indian Government, the program is intended to cover nearly 500 million people, giving them access to better health coverage. This will allow many more families, and hundreds of millions of children, the opportunity to live longer, healthier lives. Additionally, it will help to decrease child mortality, one of the key indicators of multidimensional poverty.

Cambodia

Cambodia has had particular success reducing poverty, dropping from 47.8% to 13.55% in seven years from 2007 to 2014 as a result of economic growth. As a result, life expectancy has increased by nine years, and the percentage of kids completing primary school jumped from 50% to 90%. 

The World Bank has done extensive work modernizing the Cambodian economy, as well as improving agriculture to address food insecurity now and in the future. Much of that has been done by investing in Cambodia’s agricultural productivity and making sure it is sustainable in the future. This will allow Cambodians continued access to staple crops such as rice and will boost a significant portion of the economy. 

What This Means 

The U.N.’s MPI in 2023 indicates that the actions the world is taking to reduce poverty are working, but there is still a long way to go. For every country that has slashed poverty like Cambodia, there is another country that is dealing with factors that are increasing poverty. While countries can turn to the examples provided for successful ways to deal with poverty, each situation is different, and developed countries could play a vital role in the effort to reduce worldwide.

– John Rooney
Photo: Flickr

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Disability and Poverty in Puerto Rico

Disability and Poverty in Puerto RicoAccording to the U.S. National Council on Disability (NCD), nearly one in six citizens in Puerto Rico have a disability. This equates to 22% of the population. People with disabilities (PWD) are twice as likely to live in poverty. With a national poverty rate of 44%, PWD in Puerto Rico face tremendous disadvantages, warranting a necessary examination into implementable solutions.

The Price of Poverty

There are six categorizations for disabilities: hearing, visual, cognitive, ambulatory, self-care and independent living.

According to the 2017 Disability Status Report on Puerto Rico, individuals with cognitive disabilities have the most prevalent poverty rate of 58.2%. However, despite having the lowest poverty rate for PWD, visual disabilities still result in a 52.2% rate. While the poverty rate has decreased slightly, dropping to just below 50% in 2022, there is still a concerning link between disability and poverty in Puerto Rico.

Explanations for the levels of poverty in Puerto Rico

First, there are minimal job opportunities available for PWD in Puerto Rico. In 2022, the National Council on Disability noted that only about 23.7% of Puerto Ricans with disabilities play an active role in the workforce. This is a significant contrast to the 36% of PWD in the U.S.

Second, disability accommodations are costly. The NCD found that “the cost of specialized [durable medical equipment] was 11% to 58% higher in Puerto Rico versus the [U.S.].” As of the 2021 U.S. Census Bureau, Puerto Rico’s annual income per capita is approximately $14,000, making it a massive financial burden to pay for expensive equipment like electric wheelchairs.

In the mainland U.S., citizens can qualify for supplemental income and financial assistance if they have a disability and/or fall below the annual income threshold. Despite being a U.S. territory, Puerto Ricans are not entitled to these same benefits.

For example, the Supplemental Nutrition Assistance Program, formerly colloquially known as “food stamps,” is not available in Puerto Rico. Instead, the territory is allocated a block grant, which has not been adjusted for inflation or unforeseeable disasters.

In addition, an April 2022 U.S. Supreme Court decision officially excluded Puerto Ricans from the federal Supplemental Security Income program (SSI). SSI provides direct financial assistance to low-income U.S. citizens with disabilities. This vote further entrenches the exclusion and marginalization of Puerto Ricans with disabilities.

Progress Toward Equality

In lieu of SSI, the government allocates funds to the Aid to the Aged, Blind, and Disabled (AABD) program. AABD’s supplemental assistance aims to meet the basic, daily needs of PWD in Puerto Rico. To receive this aid, individuals have to endure a “physical or mental impairment that will likely not improve and which prevents them from performing their previous job or any other paid work” and own less than $2,000 in total assets.

The Division of Human Development and Disability (DHDD) also provides early diagnosis and intervention services to aid children with disabilities throughout their development. One example of DHDD projects is the Early Hearing Detection and Intervention (EHDI) programs. EDHIs work to examine a child’s risk for hearing loss and ensure an appropriate diagnosis and accommodations are put in place.

While these services show a commitment to aiding PWDs in Puerto Rico, assistance programs such as the AABD are limited. The funding is meager and split between adult assistance, foster care and adoption assistance. Instead of the $750 for an SSI recipient, AABD participants only receive $75. Therefore, more comprehensive efforts are necessary to alleviate the impact of disability and poverty in Puerto Rico.

Despite challenges, there are gradual improvements in living conditions for Puerto Ricans with disabilities. Overall, the ongoing efforts of both the U.S. and Puerto Rico hold the potential to reduce poverty and enhance the quality of life for Puerto Ricans.

– Katrina Girod 
Photo: Pixabay

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2023 Named the “Year of the African Continental Free Trade Area”

Year of the African Continental Free Trade Area

In 2023, the Assembly of Heads of State and Government of the African Union (the AU Assembly) adopted the “Acceleration of AfCFTA Implementation” as the theme of the year. By making 2023 the Year of the African Continental Free Trade Area (AfCFTA), the AU hopes to make major breakthroughs in its implementation by increasing the political commitment of member states and the different stakeholders and improving their collaboration.

The AfCFTA Alleviating Poverty

The Year of the African Continental Free Trade Area, one of the major projects outlined in Agenda 2063 of the AU, is set to greatly contribute to the alleviation of poverty in Africa. By eradicating barriers to trade and expanding commerce within the continent, the program has the creation of a unique African market as its goal. It aims to achieve development in a sustainable and inclusive manner and to ensure food security and the development of the agricultural and industrial sectors.

With 55 member states of the AU and an expected 2050 population of 2.5 billion, the AfCFTA is also set to be the world’s largest free trade zone since the World Trade Organisation was formed, and per the World Bank estimates, it will increase the continent’s income by $450 billion by 2035.

All of this will have a major impact on poverty in Africa. The program should enable around 30 million people to leave extreme poverty. Another 68 million will be able to escape moderate poverty. By creating employment and enhancing sustainable development, the AfCFTA will significantly improve the African population’s average quality of life. 

The AfCFTA Roadmap

  1. May 2019 marked the AfCFTA Agreement entering into effect, and its implementation has progressed ever since. As of March 2023, 46 countries have ratified the agreement. Before the start of the 2023 Year of the AfCFTA, eight countries had met the minimum requirements for trade and participated in the program’s Guided Trade Initiative, an important start in the implementation of the AfCFTA. However, the project has still been limited by a need for foreign direct investment and by infrastructure issues. Furthermore, negotiations were complicated by competing interests between individual governments and the continent-wide project. 

However, 2023 being the Year of the AfCFTA has had non-negligible advantages. In July 2023, the AU’s Mid-Year Coordination Meeting remarked that the negotiations on the “strengthening of infrastructure through the corridor approach”, which had been stalling before, were now completed. The AfCFTA implementation has thus been accelerated and is on the right path to one day generate significant income and jobs for the continent, thus benefiting millions of people in poverty and the world economy. 

A Focus on Women and Youth 

The AfCFTA project also aims to guarantee socio-economic inclusiveness across the continent by facilitating women’s and youth’s access to cross-border trade. With Africa’s population being the youngest in the world (people under the age of 30 make up 70% of the overall population), and women being major participants of cross-border activities in Africa, their involvement in the development of the AfCFTA is essential. However, social inequalities in Africa impede women’s participation in the economy, thus pushing them into the informal sector.  Like young people, women are disproportionately impacted by financial and systematic obstacles and lack of employment. 

Among its objectives, the AfCFTA wishes to address this situation by including a Protocol on Women and Youth in Trade in the Agreement on the AfCFTA. 

Discussions on the Protocol, which had already been held in 26 countries before the start of the Year of the AfCFTA, have been a forum for African women in trade to shape their participation in the project and address the challenges they face today. The Protocol aims to find solutions to abolish the structural obstacles that women and youth face in trade, such as significant trade tariffs, or gender-based violence.

The inclusion of women and youth in the implementation of this program is paramount to the sound development of the trade area and the African economy. It is also essential to ensure that this important part of the African population is lifted out of poverty and can access better welfare. 

The Road Ahead

Despite the progress made in the 2023 Year of the AfCFTA, there is still work ahead to ensure its full implementation. Notably, the project is still in need of investment and hampered by infrastructure issues. However, the AU has made impressive strides toward the trade area’s full development in the past years and in 2023 alone, which shows its eagerness to succeed in this endeavor. If the AU achieves the full implementation of the program, it could mean unprecedented benefits for both the African and world economies. The potential for poverty alleviation it holds would be revolutionary for the African population.

– Kenza Oulammou
Photo: Unsplash

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The IFAD’s Plans for Eradicating Rural Poverty in Eritrea

Rural Poverty in EritreaEritrea, a small country in East Africa, had a staggering poverty rate of 38.9% in 2019, which is expected to decrease by only 13% by 2043. Affecting mostly rural communities, this situation is partly due to the young nation’s recent independence from Ethiopia in 1993, which led to recurrent wars, in conjunction with famine and drought. The heavy reliance on subsistence agriculture is one factor responsible for rural poverty in Eritrea. Despite the government’s efforts to address rural poverty, a shortage of resources and poorly implemented poverty alleviation programs have hindered progress. 

In 2006, the International Fund for Agricultural Development (IFAD), an agency within the United Nations that combats poverty through low-interest loans and grants, released a plan to tackle rural poverty in Eritrea. This plan was further improved and updated in 2020, aiming to create sustainable solutions by providing finance programs and projects that empower those living in poverty to overcome it.

IFAD’s 2006 Plan

The IFAD initially planned to eradicate rural poverty in Eritrea, focusing on various areas related to economic development and food security. The plan included developing export markets for livestock, fruit, vegetables and flowers, re-establishing port activities, strengthening public services for small-scale farmers to increase agricultural productivity, promoting a supportive private sector, attracting private sector investments, privatizing state-owned enterprises and developing a robust financial system. 

The strategy prioritized decentralization to improve access to services and emphasized gender equality as a crucial element in poverty reduction efforts, recognizing that households headed by women are the most vulnerable. Additionally, implementing programs that encourage wealthier households to provide loans and assistance during difficult times through asset and labor sharing has also contributed to the reduction of rural poverty in Eritrea.

Issues to Implementation

Although this plan appeared to present a solid push to eradicate rural poverty in Eritrea, many barriers hindered the application of these plans. Conflict deeply affected the country, exacerbating constraints on institutional capacity and human resources. This resulted in a scarcity of human capital to initiate and sustain new projects in these regions, despite the knowledge that these programs would offer relief. The eastern and western lowlands of Eritrea, in particular, faced severe rural poverty due to these conflicts, making social and economic improvement in these areas a top priority. Additionally, Eritrea grappled with challenges in natural resource management and lacked readily transferable technologies that could facilitate investments, management and maintenance implementation.

IFAD’s 2022 Improved Plan

The 2020-2025 plan for eradicating rural poverty in Eritrea aims to address these issues actively, maximizing the effectiveness of poverty reduction solutions. The Country’s Strategic Opportunities Programme will ensure that IFAD’s lending and non-lending support aligns with the government’s priorities, focusing on three strategic objectives: enhancing climate resilience, improving technology and infrastructure access for smallholder systems and building capacities for food security and sustainable livelihoods. These objectives are in line with IFAD’s Strategic Framework 2016-2025. 

To further alleviate rural poverty, the plan emphasizes various aspects in the agriculture and fishery sector, such as establishing a resource base, strengthening producers’ organizations, improving input delivery systems, enhancing intensification and value addition, developing institutional capacity and managing aquatic ecosystems. Additionally, IFAD’s investment portfolio in Eritrea will prioritize gender, youth, nutrition and employment opportunities for those most at risk.

Looking Ahead

The IFAD’s programs will actively contribute to reducing rural poverty in Eritrea by assisting local communities in becoming more commercial, competitive, resilient and sustainable. Sustainable development becomes achievable through the establishment of strong institutions and systems, effective policy and regulatory frameworks, enhanced production capacities and robust partnerships. Eritrea is progressing toward the goal of eliminating rural poverty, and with investments in plans like these, a poverty-free future appears to be within reach.

– Ada Rose Waga
Photo: Flickr

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Poverty Reduction in Tonga

Poverty Reduction in TongaThe Polynesian Kingdom of Tonga consists of 170 beautiful South Pacific islands that King Tupou VI and prime minister Siaosi Sovaleni rule as a monarchy. To the pride of its citizens, Tonga is the only Pacific island that was never colonized, even if it was a British protectorate for 65 years. Tonga’s economy struggles today because of heavy reliance on agriculture, lack of jobs and crippling natural disasters. 

Current Poverty and Risks

The U.N.’s first SDG (Sustainable Development Goal) is to erase extreme poverty. In Tonga, one in 10 adults live in extreme poverty, meaning their household income is low, and they lack five or more socially perceived necessities. These include two meals daily, two pairs of shoes and transportation. However, almost a quarter of Tongans live above the extreme poverty threshold but remain poor according to the multidimensional measure — they cannot participate in Tongan society due to insufficient resources. 

Agriculture takes up too many jobs. In 2021, 30% of Tonga’s employment was in agriculture. Still, most of the work only covers residents’ basic needs and does not help grow the economy. Though the country exports fish and produce to New Zealand, the U.S. and Japan, in 2021, these exports only accounted for 3% of the national GDP. 

Tourism also provides many jobs. In 2020, Tonga made $47 million in tourism revenue which accounted for 9.9% of a $484 million GDP. However, many of these jobs ended due to COVID-19 and natural disasters. Since non-agricultural or tourism jobs are hard to find, Tongans lack job opportunities. 

Jobs are easier to find elsewhere, so family members (especially husbands) commonly leave the island to be able to provide for their families. In 2021, this migration (e.g., remittance) accounted for 46% of Tonga’s GDP, an astronomical number. Since educated migrants come predominantly from wealthier families, there is a chance that remittance increases income inequality and causes GDP stagnation in Tonga.

Tonga is the third most at-risk country for natural disasters after Vanuatu and the Solomon Islands, two nearby disaster-prone Pacific island clusters. In the past three years, Tonga suffered over $200 million in damages from Cyclone Herald and the Hunga Ha’apai eruption. 

Permanent Aid for Poverty and Quality of Life

In 2018, the U.N. created a Pacific Strategy Plan to reach the 17 SDGs laid out at the New York Summit, the first of which aims to fix extreme poverty in the Pacific Islands. The U.N. Pacific Strategy Fund has about $17.7 million in the budget, $16 million of which came from New Zealand. The Plan’s goals are poverty reduction in Tonga and building greater resilience to extreme natural events.

In support of these efforts, the U.N. has provided equipment worth $55,000 to Tonga’s National Emergency Management Office (NEMO). This equipment will enhance the ability to alert citizens about natural disasters and promptly direct aid during crises. Over the last 12 years, the U.N. has introduced 16 permanent agencies to Tonga, including The International Labor Association, Population Fund, International Organization for Migration, U.N. Development Program and Capital Development Fund.

The CDF draws particular attention due to its role as a local transformative finance mechanism. It supports small businesses and offers private loans to projects that foster sustainable economic growth. This approach leads to a long-lasting increase in individual wealth by establishing a consistent income source, as opposed to providing mere temporary relief.

The UNDP currently works to provide HIV vaccines, rapid test kits, contraception and text message preventative information to women in Tonga. There is heavy misinformation about HIV. More than half of the population would not let HIV-positive children go to school, even though the disease is not transferable just by touch or sharing drinks.

Aid for Government Stability and Security

In Tonga, foreign aid funds most government services. Around 49% of the GDP is central government debt. In 2020, the IMF labeled the debt distress of Tonga as high. For comparison, Moldova was ranked low in risk despite 34.7% of its GDP coming from government debt. 

Using this same U.N. Pacific Strategy Fund, The U.N. liaises with the 14 governments in the Pacific and with regional bodies to promote organic, container and home farming to bolster food security, assist policy development for the economic development of outer islands, increase disaster preparedness and support decent work strategies. The organization sits in on government decisions and helps oversee the $17.7 million Pacific Strategy Plan. 

Though Tonga is at constant risk of natural disasters and has a mainly agricultural economy, consistent foreign aid promises to bring long-term growth and economic stability. Overall, there is much hope for poverty reduction in Tonga.

– Claire Duvillier
Photo: Flickr