Information and stories about poverty reduction.

 World Bank Report
A World Bank report released in October 2022 states worriedly that the progress toward achieving the U.N. Sustainable Development Goal of ending extreme global poverty by 2030 is off track. The report, “Poverty and Shared Prosperity 2022: Correcting Course,”states that around 7% of the world will still earn under $2.15 per day, the new extreme poverty standard. However, the World Bank has stated that this prediction may not come to fruition. The report lays out policies that could accelerate the decline in global poverty.

A 30-year Progress

In the past 30 years, the decline in global poverty has been nothing short of astounding. While nearly 1.6 billion of the world’s population lived in extreme poverty in 1990, the number is now only 8%. This 30-year period of unprecedented growth saw countries invest in social welfare programs. These social safety nets protect nearly 2.5 billion people and account for 36% of the reduction in global poverty as the World Bank stated.

The slowdown in the 30-year global poverty reduction progress has caused some concerns. From 1990 to 2015, the yearly poverty reduction rate generally remained above one percentage point, according to ODI. Today, the rate is now consistently under half a percentage point. Additionally, the fight against poverty has not had even distribution, with 700 million people in sub-Saharan Africa living in extreme poverty. Although the current definition is less than $2.15 a day, nearly half of the world lives with less than $5.50 a day which is an appallingly low amount. The COVID-19 pandemic appears to have worsened global poverty, at least in the short term. More than 70 million people lived in extreme poverty in 2020 alone, the largest single-year leap since 1990.

Takeaways From the World Bank Report

According to the World Bank report, the high inflation, shutdowns in COVID-19 economic programs and conflicts such as the war in Ukraine have slowed poverty reduction to a halt. Hence, although extreme poverty slightly decreased from 2020 to 2022, progress may stagnate. Given this new information, the World Bank report concludes that eliminating extreme poverty by 2030 is highly unlikely. For instance, many lower-income countries expect to see extreme poverty rates increase over the next few years. To achieve the goal of ending poverty, regions such as sub-Saharan Africa should develop at eight times the historical pace. As the report summarizes, ending extreme poverty by 2030 is already an ambitious goal and “recent setbacks have put this target nearly out of reach.”

The World Bank report is not all doom and gloom. With the exception of the Middle East and North Africa, the trend in extreme poverty is still one of decline. Most countries are exiting from their pandemic stupor and returning to normalcy. An earlier World Bank report stated that by 2023, the world economy would behave as it had prior to the pandemic. Growth may not be as high as in the rebound year of 2021 when the global economy’s GDP rose by 5.5%, but it will still increase by 3.2%.

Policy Changes

In addition, the World Bank report suggests a series of policy changes that could help steer extreme poverty reduction in the right direction. Even amid fears of a global recession and short-term crises, the World Bank has stressed the need to focus on long-term growth, including investments in education and health. They also have highlighted fiscal policy, manipulations of the money supply to change inflation and interest rates, as a tool to protect poor citizens. Borrowing for pandemic relief has been an effective way of preventing economic collapse, but doing this in the long term could lead to a strain on the budget, according to another 2022 World Bank report.

Continuing the Fight

The admission that one of the most important U.N. Sustainable Development Goals will not be achieved demonstrates how impactful the COVID-19 pandemic was, not just in the short term, but for ongoing projects since before the millennium began. At the same time, the World Bank report is a reminder that plans for the elimination of extreme poverty are always in flux, needing constant reworking to be effective and realistic. The 2030 goal may be out of reach, but the fact it was possible is a positive testament to successes in the fight against poverty.

– Samuel Bowles
Photo: Flickr

Fiscal policy
In developing nations, as well as nations recovering from a crisis such as the COVID-19 pandemic,
fiscal policy is an instrumental tool in revitalizing the economy and alleviating poverty levels. The policies are more than simply “good” or “bad” economics as they are key indicators of a nation’s true political priorities.

In low and middle-income nations, foreign aid and debt relief are invaluable in uplifting their economies. On the other hand, the contributions cannot be fully effective without an effective fiscal system. According to the United Nations, a good fiscal policy centered around poverty reduction, reconstruction and growth will focus on raising the growth rate and fostering lasting economic stability. 

Rising Growth Rate

The International Monetary Fund (IMF) emphasizes that “economic growth is the single most important factor influencing poverty, citing a recent study of 80 countries that revealed that the income of the bottom one-fifth of the population increased in exact proportion with the overall growth of the economy as measured by per capita GDP. In countries recovering from crises, a rising growth rate is one of the most effective ways for an economy to bounce back.

Key Fiscal Policies that Can Promote Economic Growth

  • Shifting Government Spending Away from Subsidies: The World Bank categorizes subsidies as a short-term solution and has indicated that they are typically politically popular because the benefits distribute widely. On the other hand, the World Bank reported that “about half of spending on energy subsidies go to the richest 20%,” as they tend to consume more energy and receive more benefits, leaving the lower-income households with little to show.
  • Investment in Cash Transfers as an Alternative to Subsidies: There is increasing data showing that direct cash transfers are a better solution to important long-run investments within households, such as education. These transfers are more beneficial to the bottom 40% and can stimulate economic activity within communities, and indirectly increase government revenue in both the short and long-term through higher tax revenue. 
  • Implementing a Progressive Tax Structure: A progressive tax structure enables governments to increase welfare benefits, such as unemployment, food stamps and housing benefits to the poor. Tax revenue sources do not change rapidly and improved progressivity in personal income tax, corporate, property, health and carbon taxes offer feasible ways to raise revenue without worsening conditions for the poor. Furthermore, nations may consider indirect taxation, as some of the above methods may not be as effective due to the informality of work in certain economies. Progressive tax structures are most effective in upper-middle-income countries. 
  • Having a National Minimum Wage: National Minimum Wages directly benefit the lowest-paid workers in an economy and reduce wage inequality. A universal basic income (UBI), wherein all citizens receive a weekly benefit to ensure a minimum income guarantee may also be effective.

Economic Stability

Prioritizing spending with long-term impacts is vital in creating a self-sustaining economy that alleviates poverty. Good policies will vary in different country contexts while acting with the future in mind even in crises, despite the fact that the benefits will come to fruition later. Below are some fiscal concepts to stabilize a nation after a crisis and to better prepare for any future challenges. 

  • Debt management is essential to maintain the “fiscal space” for crisis recovery and stabilization. Regulatory reform for financial markets, debt transparency and the implementation of a common blueprint for debt relief and restructuring are useful tools for properly managing national debt. 
  • There are many elements that can equip countries with a strategic plan for an unknown future crisis. First, expanding the reach of automatic stabilizers, such as employment guarantee schemes in nations with a large informal sector, in case of crisis. Setting up adaptive cash transfer programs that can be scaled up when necessary is also a good preparatory measure. 
  • Research and improved data, particularly on the costs and ramifications of certain policy implementations, are essential to maximizing the effectiveness of these policies. Long-term evaluations and research can provide decent indications of long-term outcomes, which is important in deciding which policies are best for unique country circumstances. 
  • In developing economies, a focus on education and diversification of the economy from agriculture to manufacturing fosters a more independent and stable economy. Increased government spending on education cultivates a higher-skilled workforce, and a push towards manufacturing pushes economic development, though proper skills and infrastructure are necessary to accomplish this.

Looking Ahead

Fiscal policy shaped around economic growth and the reduction of inequality has the potential to make great strides toward minimizing poverty. There are limits to the types and degrees of these policies in each country. Therefore, other national policy reforms implemented in tandem with economic policies lead to the best outcome in stimulating growth. Regardless of fiscal policy, foreign aid and international cooperation are invaluable in reducing poverty levels in low-income nations and around the globe.

– Carly Ryan Brister
Photo: Flickr

Poverty Reduction in South Sudan
South Sudan is considered the youngest nation in the world, officially gaining independence from Sudan on July 9, 2011, after a vote for independence was passed via referendum in January of that year. Data from the World Bank shows that the poverty rate in South Sudan was 82.3% as of 2016 – the highest poverty rate in the world. The World Bank also outlined some of the other issues South Sudan faces including severe flooding, food shortages a humanitarian crisis coupled with a vulnerable government built upon a shaky peace treaty. These issues make it extremely difficult for South Sudan to address the poverty crisis.

The Difficulty of Addressing Poverty Reduction in South Sudan

The most significant of the issues South Sudan faces is the state of its government. In 2013, a violent conflict broke out leading to atrocities committed against civilians. All sides in the conflict signed a peace deal in 2015 for a unity government but the deal collapsed in 2016, leading to more conflict. In 2018, that deal became revitalized when President Salva Kiir and the leader of the Sudan People’s Liberation Army (SPLA/IO), Riek Machar, came to an agreement. Machar became vice president under the new government and the agreement was set to expire in February 2023. However, the parties who signed the peace agreement agreed to extend it to February 2025 in order to address peace reforms.

That front requires more work due to the injustices committed against South Sudan’s people by the military and rebel forces. For example, a U.N. peacekeeping mission in 2021 documented the killings of 440 civilians and the rapes of 64 women and girls in Tombuura by the SPLA/IO. None of the perpetrators were held accountable.

U.N. Special Representative for South Sudan Nicholas Haysom expressed the need for South Sudan’s government to address violence and uphold justice. In a speech to the U.N. Security Council, Haysom addressed the extension to the peace agreement and stated that it is a roadmap that should serve as a  waypoint, not an endpoint. The reforms that the South Sudanese government makes should serve as a means to generate long-lasting stability. They should not serve as a means to an end. It requires measures to prevent setbacks or gains from reservation. Haysom also reaffirmed the importance of international assistance, which will lead to poverty reduction and governmental stability in South Sudan.

Addressing Poverty

While the outlook for South Sudan may seem grim, there are solutions to poverty that various charities are implementing through foreign aid. The World Food Programme (WFP) is one example of an organization working to bring peace to feuding groups in South Sudan by addressing food insecurity. In an article about the Malual Mok and Thony communities, the WFP demonstrates its poverty reduction and peacekeeping efforts. Both the Malual Mok and Thony live in an agricultural area called Majak-Kot. The communities previously considered each other enemies, but a series of agricultural projects from the WFP helped to foster a sense of community between them. Instead of fighting over the land and competing to grow food, both communities peacefully coexist and grow food together for mutual benefit.

Moreover, nonprofit charities are also working towards poverty reduction in South Sudan. Many South Sudanese refugees founded charities dedicated to poverty reduction in South Sudan. One example is Helping Hands for South Sudan. Gabriel Akim Nyok, one of the “Lost Boys and Girls of Sudan,” a group of thousands of orphaned children who became refugees to escape from the civil war, founded this charity. After staying in the U.S. for five years, Nyok returned to Sudan in 2011 to visit the South Sudanese refugee camps. In doing so, he became determined to give the children the same opportunity for education that he received. Nyok and his charity have helped put South Sudanese refugee children through school each year. Helping Hands uses donations to put children through school and pay for their education and works directly with South Sudanese communities to improve schools and education.

– Matthew Wikfors
Photo: Flickr

Poverty Reduction in Latvia
The COVID-19 pandemic and the Russian invasion of Ukraine in 2022 have presented challenges to poverty reduction in Latvia. Due to these factors, Latvia suffered from a high unemployment rate in 2020 and an increasing inflation rate in 2022. Because of this, growth in the Latvian economy has slowed, prompting the government and organizations to take action to ensure Latvia is still on track to meet the 2030 U.N. Sustainable Development Goals (SDGs).

The Impacts of the Pandemic

Prior to the COVID-19 pandemic, the unemployment rate in Latvia had significantly lowered, standing at 6.3% in 2019, the lowest percentage visible over a decade. After the onset of the pandemic, the unemployment rate increased to 8.1% in 2020. Women faced the disproportionate impacts of unemployment at the onset of the pandemic. In 2020, Latvia’s GDP saw contracted by 3.9% but expanded by 4.5% in 2021, according to the World Bank. The World Bank reports that the number of people in Latvia living under the national poverty line stood at 21.6% in 2019 but increased rapidly to 23.4% by 2020.

Growing Inflation Due to the Russia-Ukraine War

Another economic instability happened when the impacts of the Russia-Ukraine war touched international trade in Europe. In Latvia, inflation became an issue. As a result of the Russian invasion of Ukraine, “food, energy, and other raw material” costs have risen. Inflation in Latvia rose beyond 10%, the highest rate visible since 2008.

By March 2022, inflation in Latvia reached 11.5%. “Housing-related goods and services” rose by 14.5% on average while “transport-related goods and services increased by 22.9%, driven by a 43.3% increase in fuel prices,” according to the Central Statistical Bureau of Latvia.

The growing inflation rates are most harshly affecting impoverished families, but pensioners are most at risk of poverty amid the rising prices, with many unable to afford their heating bills.

Efforts Toward Poverty Reduction in Latvia

In May 2022 the Latvian government adopted the second Voluntary National Review (VNR), which “evaluates progress, challenges and presents new initiatives to accelerate the achievement” of the SDGs, according to the U.N. These SDGs include No Poverty (SDG 1) and Decent Work and Economic Growth (SDG 8).

In a 2022 report assessing Latvia’s SDG progress, Prime Minister Krišjānis Kariņš said that “We are helping those most in need and promoting equal opportunities for all in Latvia.” He explained further that the government is prioritizing housing and mobility initiatives to expand economic growth and promote decent work out of Riga, Latvia’s capital city. Furthermore, Latvia is “improving access to health care, including significantly increasing salaries for the lowest paid medical practitioners.” The government is also raising the minimum income threshold for individuals most vulnerable to poverty. During the COVID-19 pandemic, the Latvian government provided support to people and businesses impacted by economic stagnation and lockdowns.

The Latvian Platform for Development Cooperation (LAPAS) came about in 2004 to bring Latvian non-governmental organizations together in order to promote development in Latvia. LAPAS works toward the achievement of the U.N. SDGs through advocacy efforts, global education priorities, the promotion of local organizations and educating and updating the public on developmental issues via workshops, social media, lectures and more.

Through ongoing commitments toward achieving the U.N. SDGs, the Latvian government and organizations can reduce poverty in Latvia while igniting economic growth and improving the quality of life in Latvia overall.

– Olga Petrovska
Photo: Unsplash

Future of Poverty
The Bill & Melinda Gates Foundation recently released its annual Goalkeepers Report aimed at analyzing data relating to the U.N.’s Sustainable Development Goals (SDG) and insights on the future of poverty. The Bill & Melinda Gates Foundation is a nonprofit with the goals of fighting poverty, disease and inequalities around the world. Bill and Melinda Gates formed it in 1994. As philanthropists, they made it their Foundation’s mission to use their resources to fulfill the U.N.’s SDGs which also aligns with the work of their Foundation.

The SDGs

 The SDGs are 17 economic, social or environmental goals that the U.N. implemented to protect the planet, achieve prosperity and end poverty. The 2022 Goalkeepers Report is ambitious and complex, in that the expectations of enduring a pandemic and multiple wars were non-existent while setting the SDGs. However, the report stated that the magnitude of these events may have had ill effects on the data but a positive one on the actual reality of working towards those goals. The report also stated that there are two things no data point can prove: crisis and innovation.

Major Takeaways and Analyses from the 2022 Goalkeepers Report

Going back to the effects of the pandemic and conflicts such as the Ukraine-Russia war, it is not unusual for these events to negatively affect the data. The pandemic left 114 million people unemployed in 2020, meaning 114 million people lost stable livelihoods. Not only the pandemic left people without jobs, but it also caused severe disruptions in the supply chain due to border closures, a lack of workforce and financial instability. Panic buying and deficiency in stocks were major consequences of the inadequate supply chain, making goods less and less accessible.

Another disruption that hit the supply chain was the Russia-Ukraine War. Many African nations heavily depended on wheat imports from Ukraine. With the emergence of war stopping the shipments, the price of wheat-based products surged to the highest level its been in 40 years. Even though prices have relatively stabilized, the small shock showed how modern famine could present itself and how little the world is prepared for it.

After turbulent times for the world economy, Goalkeepers Report data shows promise not necessarily in the numbers themselves, but in the intangible potential for human ingenuity. Gates commented in the report that “No projection can ever account for the possibility of game-changing innovation” on the data projections on the SDGs for the next 10 years.

Financial Autonomy for Women

A significant step in reducing poverty is firstly making sure all people have access to money. Gender equality is essential in making sure both men and women have the same opportunities and means of accessing their money. Making financial platforms available and secure for women, especially in low-income countries, is necessary for achieving financial autonomy for both genders.

Data shows there has been an upwards trend in the last 5 years in the number of women owning a financial account and mobile money account. Mobile money account ownership of women in low-income countries increase from approximately 12% in 2017 to 24% in 2021. What this dataset indicates is more than the concrete number of women owning bank accounts, but the subject of women taking ownership of their livelihoods.

Tieing this to the initial message of the report, even though data is just data, the human aspect behind it is what makes the future more hopeful and brighter. Another take on the future of poverty from the report is the need for a replanning of the strategy behind food and humanitarian aid.

Strategy for Humanitarian Aid

Gates highlights that “The goal should not simply be giving more food aid. It should be to ensure no aid is needed in the first place.” Numbers on the report show the money spent on food aid keeps getting more and more every year, hitting a high of $57 billion in 2020. Whereas funding for agricultural research which will help developing countries create food security in the long run barely increase in the last 10 years, with only $9 billion in 2020. Comparing the money spent on a temporary solution such as food aid to agricultural research, numbers seem promising yet the truth behind it is that our strategy needs improving.

Taking into account the severe climate stress the agriculture industry will endure in Sub-Saharan Africa, “32 million more people in Africa are projected to be hungry in 2030” the report states. Solving world hunger is key to reducing poverty in the future, as more food on the market means cheaper and more accessible it is for the more disadvantaged. It is a very achievable challenge, as long as people change the strategy in their approach to food crises and look beyond the data.

As Gates states, “That challenge (solving food hunger) can’t be solved with donations. It requires innovation.” This is exactly what the Gatekeepers 2022 report suggests and promotes. A look beyond data and a vision larger than just numbers are what will define the future of poverty.

– Selin Oztuncman
Photo: Flickr

Poverty Reduction in Uganda
In January 2022, Uganda’s economy grew by 4.6% an uptick from 3.4% in 2021 and 3% in 2020. Despite facing challenges during the pandemic, the country’s economy quickly recovered as the services sector and industries resumed activity. However, the East African nation with a population of 47.1 million people has an international poverty rate of 42% making poverty reduction efforts more critical than ever.

The Slowdown in Poverty Reduction in Uganda

The slowdown in poverty reduction in Uganda was in part due to rising commodity prices and disruptions in the global supply chain exacerbated by the war in Ukraine. This triggered high inflation which reached 6.8% from only about 2.7% in 2021. In response, the Bank of Uganda increased its policy rate by 1% in 2022 to 7.5%. This monetary policy slows the economy to keep inflation stable and return to lower price levels. A more stable economy in January 2022 allowed Uganda to experience increased private investment and higher activity in construction and manufacturing and export diversification.

The Impact of COVID-19 on Poverty Reduction in Uganda

One cannot dismiss COVID-19’s impact on poverty reduction in Uganda. In 2020, the government closed the borders and issued a nationwide lockdown and curfew. In addition, it also shut down schools, shops and churches. Economic growth slowed down and the government’s free health care programs reduced access to health care. In this period, relief aid went to urban areas and the poorest in rural areas ended up vulnerable. After seeing the impact of the pandemic the government gave out credit facilities, offered waivers of interest on tax, tax deductions and lowered interest rates to finance the private, agribusiness and manufacturing sectors.

The Village Enterprise Microenterprise Program

NGOs have also stepped in to boost Uganda’s economic growth and development. The Village Enterprise microenterprise program partners with governments and NGOs to eradicate extreme poverty primarily in rural East Africa. It works directly with poor households through entrepreneurship with the objective of lifting 20 million people out of extreme poverty by 2030. Over a period of one year, it provides them with mentorship, cash transfers, business training and the formation of saving groups. In Uganda, more than 30,000 businesses started through this program and 113,000 first-time entrepreneurs have received training. The impact created more consumption and income and improved the standard of living of hundreds of thousands of households.

The Strengthening Education Systems for Improved Learning (SESIL) Program

Uganda’s low education level presents another challenge directly contributing to poverty. Two out of five secondary school teachers did not have undergraduate degrees in 2017. Additionally, most classrooms have too many students, in some cases more than 60 which does not provide an environment that facilitates quality education. Uganda has one of the fastest-growing youth populations but government spending on education has fallen from about 25% in the early 2000s to only 11% in 2018.

The government recognized the growing youth population and in 2018 launched the Strengthening Education Systems for Improved Learning (SESIL) program. This U.K. aid-funded program improved the quality and equity of education in lower primary schools by focusing on an approach called Managing for Results (M4R). Teachers and ministry officials used data collection and analysis to monitor student progress. Based on their interpretation they were able to make decisions to improve students’ learning outcomes. This program has undergone implementation in more than 1,800 schools and trained more than 6,000 teachers in Uganda. There has already been evidence of the value of the program and its data collection approach to spot challenges and sustainable solutions in lower education.

The youth is what makes poverty reduction in Uganda and in other parts of the world important. They make up the future generation of this world. Their education is of the highest priority. It not only provides them with opportunities and pathways away from poverty but it also guarantees a more sustainable future.

– Hans Harelimana Hirwa
Photo: Flickr

International Volunteering
International volunteering is the process of completing unpaid work in a foreign, and often developing country in great need. It is an extremely diverse practice and includes teaching, environmental conservation, and supporting communities. This is an excellent practice to have a positive impact on the people and environment of the country.

One can view international volunteering and poverty reduction as two interrelated aspects. The practice has received great commemoration for its impact and success in addressing poverty. For example, the U.N. recognizes international volunteering with International Volunteer Day, celebrated every year on December 5. Despite this, it is not without its criticisms.

International Volunteering and Poverty Reduction

According to World Vision, about 9.2% of the world’s population (689 million people) live in extreme poverty and survive on less than $1.90 a day. Poverty has extensive repercussions including hunger and food insecurity, increased crime and child mortality rates, political instability and corruption. Many households that suffer from poverty are exposed to precarious situations. For example, they deal with exploitation due to their limited access to employment. Poor labor laws, insufficient political and trade-union representation and general economic issues are making this issue worse.

Oftentimes, in these low-income and developing countries, there is a lack of key public infrastructure including schools, hospitals, security services and social protection schemes for people to access. Even in areas where they do exist, there is no way for the poor and marginalized to engage with them.

Others have regarded international volunteers as an under-recognized yet essential source to support poverty reduction and service delivery in low-income countries. In a 2015 report, Voluntary Service Overseas (VSO) discovered how they play a significant role in “bridging the gap.” Not only do they add to the number of those working, but they also bring their own experiences to the workforce, helping to ensure that the services are relevant to those using them.

In Mozambique between 2004 and 2008, the number of those providing home-based care for AIDS patients increased from 17,170 to 99,122 because of international volunteers.

In Lesotho in 2015, international volunteers had the task to design and implement training programs for more than 400 youth leaders in an initiative that was volunteer-run. Using social media, the volunteers were able to teach the youth leaders how to establish their own platforms and engage with other young people, thus, creating a sustainable method of poverty alleviation.

In Burkina Faso, a partnership between the Ministry of Youth and Employment, the United Nations Development Programme (UNDP), United Nations Volunteers and France Volontaires had tremendous results. They established programs designed to target the employability of young people in the early 2010s. They mobilized more than 13,000 youth volunteers which gained many new competencies such as how to access information on gender issues and learn about labor market competitiveness. Overall, the program resulted in 66% of the youth gaining ‘decently paid jobs’ after.

Disadvantages of International Volunteering

Despite international volunteering having a fruitful impact on poverty reduction in low-income and developing countries, it has been receiving extensive criticism as well. Perhaps the most condemned aspect of going abroad to volunteer is the idea of ‘stealing’ local job prospects. Rather than prioritizing local needs, organizations place money, effort and energy into international volunteer programs where the volunteer’s experiences and activities are often more important to some. Furthermore, volunteers tend to be young and inexperienced, and thus, can hinder poverty reduction. Shannon O’Donnell, the author of the Volunteer Traveller’s Handbook, stated that ‘”there is no doubt that volunteer programmes shift jobs from locals to potentially less skilled labour.”

Another key disadvantage is the duration of volunteer projects. Although many organizations offer and promote long-term projects, most of them are short-term. This is mostly based on the volunteer’s ability and time available to commit to a project. Like the criticism above, these projects become ‘volunteer centric,’ creating an array of short-term placements which enable a constant flow of new volunteers. This means that the organizations put more effort into training them rather than actually supporting poverty reduction initiatives.

An interrelated criticism focuses on international volunteering projects which focus on poverty reduction for children. During their time, volunteers build deep connections and relationships with children. They might do this by supporting their education in schools through lessons or extracurricular activities, community events or even helping in orphanages, all of which prove how the existence of volunteers is beneficial on multiple levels. As a result, the departure of these volunteers at the end of their projects may lead to psychological and emotional consequences for the children. Stephanie Halksworth from ReSet stated how these consequences include a “sense of abandonment, invalidation and stagnation.”

Ethical Volunteering: The Future of Poverty Reduction

The disadvantages stated above of international volunteering question its ethics and how these may be skewed in favor of the volunteer. A new form of volunteering branded as ethical volunteering emerged in 2016 to address these concerns. Ethical volunteering ensures that volunteers are not only doing so for themselves but also providing aid in a responsible and sustainable way. With support from the U.N., such activities are relevant to poverty reduction and staying aligned with this cause.

Here are five ideals associated with ethical volunteering:

  • Making a sustainable impact
  • Contributing to community development
  • Interacting with the environment (including animals) responsibly
  • Personal development grounded in ethics
  • Gaining a global perspective

International volunteering can be a positive force for supporting communities and poverty reduction. Regardless, its core elements have received critics, something which hints at the need for a change within the practice. Ethical volunteering overcomes these considerations and represents the future of international volunteering for poverty reduction.

– Harkiran Bharij
Photo: Flickr

Poverty Reduction in China
In 1949, China was one of the world’s poorest countries with only 10 countries having a lower GDP. Now, however, it received the classification of being a high-income status country, with 800 million people having risen out of poverty since the 1980s. In 2021, the Chinese government announced that it had eradicated absolute poverty in the country. As a result of this strong and sustained development, the globe has recognized poverty reduction in China as a success.

A Brief History of China’s Success

The number of people living in China with incomes less than $1.90 per day, which is the international poverty line as defined by the World Bank to help track global extreme poverty, has fallen down significantly. An important achievement, this represents a 75% global reduction of those living in extreme poverty. This significant reduction has enabled China to become a “moderately prosperous society in all respects,” with poverty reduction in the country a result of continued economic growth and reforms starting from the 1980s. Key developments across the decades include:

  • 1980-1990: From 1980 to 1990, rapid income gains occurred in agriculture including an increase in production, industries’ subsuming of far labor and the increase in quality and quantity of food consumption.
  • 1990-2000: In 1990-2000, industry became the prime focus of Communist Party Chairman, Deng Xiaoping, who deepened and widened the reforms in both the rural and urban areas. This involved furthering market-oriented reform for future development and Chinese prosperity.
  • 2000-2010: The years 2000 to 2010 saw dynamism within the country’s export-oriented coastal areas spread farther inland. Herein, rural-to-urban migration increased, investment in infrastructure grew and growing proportions of China’s land became economically integrated into global value chains. There was also an expansion of Chinese social policies, including the creation of a basic safety net for the rural population.
  • 2010-2020: From 2010 to 2020, China widened the social policies it implemented during the 2000s, something which led to a targeted poverty eradication campaign. However, transfers became a more important factor in poverty reduction than labor incomes.

Poverty Reduction Under Xi Jinping

Since becoming the leader of China in 2012, Xi Jinping implemented his own policies to attain further poverty reduction in China. The core action includes deploying funds to cover several areas such as financing for rural infrastructure, agricultural subsidies and discounted loans. Other strategies include:

  • Targeting households that are in need of support rather than whole villages and counties. These households include people who are ill, handicapped or destitute.
  • Moving away from conditional cash transfer programs and towards loans, wages and subsidies.
  • Targeting individuals and households for resettlement so that they have better opportunities at living a fulfilled life.

Human Capital Failure

Despite poverty reduction in China receiving worldwide recognition, there are still a significant number of people who remain vulnerable and live in poverty. Human capital, especially in rural areas, remains underdeveloped. This is due to deficient education, with 63% of students dropping out of school before they graduate high school. There is also the issue of malnutrition, health problems and lack of childhood development for children.

Not only does the lack of efficient human capital negatively impact the future of rural children and their families, but it also threatens the stable future of China, even derailing the country’s success in poverty reduction. Currently, around 70% of the Chinese labor force lacks a high school education. As the country moves towards an innovation-driven economy, something which began during the reform period, between 200 and 300 million working-age Chinese may become unemployable. As a result, this is something that China needs to address.

The Future

In August 2021, President Xi introduced the concept of common prosperity at the Central Committee for Financial and Economic Affairs with the aim of achieving it by 2050. He has referred to this term as being present when the incomes of low-income groups increase and there is societal fairness, balanced regional development and an emphasis on people-centered growth.

Common prosperity signals a new era for the country (ending the reform period), where socialist modernization receives recognition as pivotal for China’s continued poverty reduction. Along with focusing on the areas mentioned above, it seeks to address the perceived social ills which have stemmed and grown from capitalism and unchecked growth.

Common prosperity represents an optimistic future for poverty reduction in China. It shows the care and attention placed on social development, along with the continual attention directed to economic growth. President Xi hopes to make “solid progress” on this goal in 2035, and then to “achieve common prosperity by 2050.”

– Harkiran Bharij
Photo: Flickr

Social Exclusion
Despite the overwhelming loss due to earthquakes in 2015 and a near total economic seizure due to the halt in its cross-border trade with India in January 2016, Nepal reported one of the fastest poverty decline rates in the world particularly between 2003-2004 and 2010-2011. Between 1995–1996 and 2010–11, there was a 2.2 percentage point average yearly drop in the absolute poverty rate, bringing it to its present level of 25.2%. The significant increase in remittances sent by hundreds of thousands of Nepalis who have been working abroad since the late 1990s is the primary cause of the improvements in living conditions and the elimination of poverty and social exclusion. Both the quantity and the number of households in Nepal that receive remittances increased concurrently. From 1.3% of GDP in 1995 to 23% in 2010, remittances have grown in magnitude, and as of now, they account for 29% of GDP. The typical household income is now 16% remitted, up from 6% in 1995–1996.

The Complex Relationship Between Social Exclusion and Poverty

However, as evidenced by the low level of human development indices, inequality due to social exclusion demonstrates that poverty in Nepal also has inextricable links to a lack of access to the very resources required for overcoming it. A Hindu-dominated society, it has excluded four groups of people — Dalits, Madheshi or Terai people, ethnic/indigenous people and women —- from the contemporary development process be it political, economic or socio-cultural exclusion. Here are four ways that social exclusion and poverty interconnect in Nepal.

4 Facts About How Social Exclusion and Poverty Interconnect in Nepal

  1. Disparities in the prevalence of poverty in Nepal and measures of human development are one way that caste-based social exclusion takes shape. The highest caste group, the Brahmins, has a significantly lower poverty rate than the lower caste groups, who lack opportunities in all spheres of life (cultural, social, political and economic). For instance, the literacy rate for the lowest caste is barely half of that for the upper caste groups with the life expectancy of the latter being six years more than the lowest caste at 51 years. Consequently, the rate of absolute poverty is 15 times higher in the lowest-caste groups than the national average.

  2. The most glaring example of social exclusion based on ethnicity is poverty, which affects ethnic minorities like the Limbus, Tamangs, Magars, Tharus, Musahars and indigenous groups much like Chepangs and Raute more frequently than the general population as a whole. However, the Newars, who mainly inhabit the Kathmandu valley and other urban areas, have the lowest rate of poverty.

  3. The Madhesi people have continuously experienced marginalization and exclusion from political, administrative, governance, policy development and decision-making processes. This has resulted in continual issues with citizenship, identity, language and their own home territory. The Madhesi people experience extreme discrimination and have almost forgotten what it is to “belong to this nation.” Paradoxically, though, the Madhesi and Terai (referred to as the main economic hub of Nepal by Gaige (1976) community’s exile from the national mainstream has been detrimental to the nation’s steady economic growth.

  4. The situation is even more alarming for women from the lowest castes, where the literacy rate is only 7% and other social indices also show low scores. Due to their low position within their own group, Dalit women are even more disadvantaged. For instance, estimates have indicated that almost all Dalit women are living below the official poverty threshold. Discrimination, indifference and violence have links to exclusion.

 Actions to Promote Social Inclusion

The Muluki Ain Civil Code of 1854 made the extremely rigid and hierarchical caste structure legal and gave the Adivasi Janajatis (non-Hindu indigenous ethnicities) a middle-rank position within the system. In 1963, Nepal legally outlawed caste-based discrimination. The government has taken action to increase Dalit involvement in local and national governance mechanisms through legislation and initiatives. Additionally, following the political shift in 2007, the inclusion of women continued to rise.

Even though the Panchayat rule put little effort into the integration of women, women’s representation in politics increased significantly. With the rise of modern under-grounded parties, the sixth amendment to the law code in 2033 B.S. granted some rights to women. By prohibiting child marriage and polygamy, Nepal made changes to the law governing women’s property, Anshabanda (the division of property among/among those legally entitled to it), women’s trafficking, prostitution and rape, among other things. A provision of 5% women candidates for parliamentary and 20% women representatives from each ward level became obligatory alongside the provision of at least 33% of women participation in legislative parliament.

The Constitution attempted to end all forms of discrimination based on national origin, race, caste, tribe, sex, economic circumstance, language, religion, ideology or any other basis, and it guaranteed equality before the law to all Nepalese citizens. Discrimination is illegal, and those who are the victims of it may seek restitution. By gathering better-disaggregated statistics and information on the effects of various forms of discrimination on the rights of different groups, Nepal devoted itself to combating inequality and discrimination. As a result, it developed suitable laws, policies and programs.


With regard to the domestication of the Convention and its successful application, Nepal had made a number of remarkable advancements, most notably through the adoption of a federal, democratic and republican Constitution in September 2015 and the establishment of local governments. Indicators of poverty and human development have been improving nationally, although there are still some disparities based on caste, ethnicity, location and gender. Although the government is succeeding in its mission to end poverty by addressing and reversing social exclusion, more is necessary to remove prejudice towards these communities on a societal level.

– Karisma Maran
Photo: Flickr

Poverty Reduction in Cambodia
Cambodia’s economy has improved drastically over recent years, and this growth has followed a considerable poverty reduction in Cambodia. According to a study by Asian Development Bank (ADB), the national income per capita increased from $250 in 1998 to $795 in 2008. Furthermore, Cambodia’s economy sustained an average annual growth rate of 7.7% between the years 1998 and 2019, setting a record high for developing nations around the world.

Garment Industry

Cambodia’s economy solely rests upon its agriculture industry, tourism, garment production industry and construction industry. The garment industry, in particular, has boomed in recent years and contributed heavily to the nation’s economic development. For example, 40% of garments that the European Union (EU) receives come from Cambodia. This number totals 30% for the United States, 9% for Canada and 4% for Japan. Multinational brands such as Adidas, Gap, H&M, Marks and Spencer and Uniqlo have garment factories located in Cambodia. Furthermore, the garment production sector in Cambodia has employed more than 600,000 Cambodians and accounts for more than 16% of the national gross domestic product (GDP).

Strides in Public Health

Development in other fields, such as public health, has followed poverty reduction in Cambodia. According to the World Bank, the nation’s life expectancy has also increased from 58 years in 2000 to 70 years in 2020. The under-five mortality rate decreased from 106.3 per 1,000 live births in 2000 to 26.6 per 1,000 live births in the year 2019. The national government is buckling down on its commitment to the Health Equity and Quality Improvement Project (H-EQIP). The project, issued in 2016, has a commitment to implementing better health care for all Cambodian citizens.

The Cambodian Ministry of Health (MOH) has also initiated special services to help underserved communities and regions within the nation. An example of this is the voucher program for women’s reproductive services. Through the program, grants go to referral hospitals across the nation to help them better serve those in need. In addition to such programs, USAID has worked in Partnership with Cambodia in the last five years to further its public health systems. USAID has helped to train medical staff in tuberculosis management information systems in 47 hospitals across the nation. USAID has also distributed more than 37,000 mosquito nets to dengue and malaria-prone areas in Cambodia.

Future Strategies

Going forward, the Cambodian government has future plans to further eliminate poverty within their nation. The Cambodia Sustainable Development Goals 2016-2030, National Poverty Reduction Strategy 2003-2005 and the National Strategic Development Plan 2019-2023 are all key cornerstones for Cambodia’s development. The key focus of poverty reduction initiatives has roots in implementing better social protection, ensuring equal access to economic resources and protecting ownership over land and property – three pillars that can support poverty reduction in Cambodia.

Attending to Infrastructural Gaps

The World Bank Group’s work in Cambodia has a focus on adopting a rectangular strategy for development. The World Bank Group plans to address issues such as a lack of human capital, infrastructural gaps and limited professional development programs in Cambodia. A prerequisite for these goals is improving access to education in Cambodia, which in itself can be an antidote to poverty. Since 2016, 97.7% of all Cambodian children have attended school. Furthermore, student drop-out rates have plummeted both in cities and rural areas. These are all positive signs of progress that depict further poverty reduction in Cambodia.

Given the multilateral development that has taken place in Cambodia in the last decade, the nation has surpassed the lower middle-income tier and is now on its way to becoming an upper-middle-income nation by 2030. With sustained effort, collaboration and attention to infrastructural development, Cambodia has the potential to further its economy whilst eradicating poverty within its borders.

– Samyudha Rajesh
Photo: Unsplash