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The World Economic Forum and Global Poverty

The World Economic Forum and Global Poverty
In the realm of international relations, there are countless organizations that have complex acronyms and unclear operations. The biggest and best-known organizations are the International Monetary Fund (IMF), World Bank, World Trade Organization (WTO) and Organization for Economic Cooperation and Development (OECD) which often obfuscate lesser-known organizations, such as the World Economic Forum. The World Economic Forum and global poverty link which this article will explore while addressing the organization’s purpose.

What is The World Economic Forum?

The World Economic Forum is an international organization that emerged in 1971, congregating leaders in politics, business, culture and society to address issues and facilitate solutions on a global, regional and industrial scale. The pinnacle of the organization occurs every January in the form of an annual meeting in Davos, Switzerland at the organization’s headquarters. Global elites gather at the Swiss ski resort and discuss all manner of topics, ranging from the latest in technology and innovation to critical issues like rising global income inequality and global poverty generally.

Despite its standing as an independent nonprofit, people often confuse or associate the World Economic Forum with the United Nations, partially due to its focus on the U.N.’s Sustainable Development Goals (SDGs). These ambitious objectives range from broad, borderline idealistic ones such as No Poverty and End Hunger to Industry, Innovation and Infrastructure and Reduced Inequalities.

What Does The World Economic Forum Do?

In places like the World Economic Forum, world leaders and officials access the progress of the SDGs and evaluate what their statuses are and what they need for the future. For instance, a September 2018 article emphasized the success of the World Economic Forum’s initiative in reducing poverty, reducing the total amount of people living on less than $1.90 a day to 655 million people, or about 9 percent of the world’s population. The article cautions against too much hope, however, forecasting that the goal of ending poverty by 2030 will fall 480 million people short, or about 6 percent of the population. These figures come from a World Bank report portioning some of the blame on many countries failing to meet a U.N. target of 0.7 percent of economic output on aid, a sentiment that the London-based Overseas Development Institute supports.

How does the World Economic Forum intend to combat this shortcoming? In an October 2019 announcement, the forum proclaimed a theme for the January 21-24, 2020 meeting: Stakeholders in a Cohesive and Sustainable World. Reinforcing its commitment to the SDGs and the Paris agreement of 2015, participants will solidify a meaning to ‘stakeholder capitalism,’ a principle that companies should meet the needs and requirements of all of its stakeholders, including the general public. The World Economic Forum will emphasize six areas including Ecology, Economy, Technology, Society, Geopolitics and Industry, in an application of this philosophy. All of this will align with the forthcoming Davos Manifesto 2020, mirroring the Davos Manifesto of 1973, which founder and Chairman Klaus Schwab believes will “reimagine the purpose and scorecards for governments and businesses.”

Conclusion

Some criticize the World Economic Forum for being an aloof, exclusive assortment of billionaires and powerful people, exactly the kind of people global inequality directly benefited. Participants at Davos do seem to be aware of this, identifying rising inequality, protectionism and nationalism as byproducts of the globalization that they supported. Klaus Schwab, The World Economic Forum’s founder, realizes that globalization created many winners, himself included, but that the losers now need recognition and assistance. It can be difficult to attribute any direct action to the World Economic Forum, as its participants act mostly independently of it, though informed by discussions and insights gained at it. However, given the overall rhetoric and specific support of the Paris Agreement and Sustainable Development Goals, the World Economic Forum and global poverty clearly intertwine as the organization positions itself as a beneficial actor for the entire globe.

– Alex Meyers
Photo: Flickr

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15 Facts About Poverty in Afghanistan

Poverty in Afghanistan
Afghanistan continues to be a major focus of U.S. foreign policy. Yet, while there are hundreds of news articles about the country’s politics, there is less information about the country’s people. Below are 15 facts about poverty in Afghanistan to provide insight into the problems Afghanistan’s poorest citizens face every day.

15 Facts About Poverty in Afghanistan

  1. About 90% of Afghans Struggle to Live on Their Current Income: Over the past decade, poverty in Afghanistan has risen to record-breaking heights. From 2008 to 2018, the number of Afghans reporting that their current income was insufficient to support their family grew from 60% to 90%. Keep this number in mind when reading the other 15 facts about poverty in Afghanistan. These facts apply to 90 percent of the country’s citizens.
  2. Well-being is at Global Record Lows: Poverty not only affects people economically or physically – there is an emotional toll as well. According to a 2018 Gallup poll, only 36% of Afghans said that they smiled or laughed the previous day. When asked to rate their lives on a scale of 0 (worst) to 10 (best), Afghan citizen responses averaged 2.7. Most recently, in 2016, Afghan citizen responses on the same question averaged 4.2.
  3. Education has Become a Luxury for Children: A 2018 U.N. report noted that more than 2 million children aged 6-14 worked to support their families. With an average of 58% of Afghan families unable to afford food, full-time work becomes a higher priority than education. In February 2019, UNICEF, the U.N. and the government of Afghanistan launched a long-term education response program projected to help half a million children in the country. The program hopes to raise an additional $35 million within the next year to help support education infrastructure and secure teachers, supplies and similar needs for schools across the entire country.
  4. Undereducated Afghan Citizens are the Most Vulnerable: Undereducated citizens suffer the most during economic downturns in Afghanistan, with an unemployment rate of 8% and underemployment (employed, but unable to cover living costs) of 41%. With the difficulty of getting an education, the cycle of poverty continues for many families.
  5. Armed Conflict is the Top Reason for Poverty: Poverty in Afghanistan has direct links to increases and decreases in Taliban control in the country. When the Taliban increased its influence in Afghanistan between 2012 and 2017, the number of citizens living in poverty increased from 38% to 55%. The World Bank believes that political settlement with the Taliban would be an important step forward to attract the return of capital and skilled workers from overseas.
  6. Youth Migration is a Problem: Since 2015, about 146,000 young Afghan workers moved to Europe per year in hopes of starting a better life. The government still struggles to keep young people in the country and implemented a 2015 initiative to help the 700,000 entrants into the Afghan workforce find jobs. However, the program was unsuccessful in generating enough funding to make an impact.
  7. Displacement: In 2018, conflict and drought displaced more than 550,000 new Afghan citizens. Between displacement and a dwindling young professional population, it is difficult for Afghanistan to keep skilled workers to further its economy.
  8. Government Corruption Fuels the Fire: The economy in Afghanistan grew only 2% in 2018. The World Bank has reported that the sluggish economy is a direct result of government corruption. This means aid to struggling areas is often delayed or never arrives and economic growth benefits only the country’s highest elite (and former warlords).
  9. Iran Affects Afghanistan’s Poverty: Approximately 2.5 to 3 million Afghans left home to pursue better economic opportunities in Iran. These migrants have been a vital part of the economy as they send their Iranian wages home to their families. Unfortunately, as the Iranian economy has crashed, so have the available wages. The rial lost approximately 70% of its value, drastically decreasing the ability of workers to support their families back home.
  10. Programs Struggle with a Lack of Information: Due to conflicts and a lack of resources, it has been 40 years since the Afghan government has been able to conduct a proper census or any similar survey of the population. This makes planning and poverty initiatives difficult, as there is no data available to support decisions on where to invest aid.
  11. Afghanistan Ran on an “Artificial” Economy: From 2011 to 2014, Afghanistan had an artificial economy, meaning that economic growth and development were wholly reliant on external foreign aid with little to no internal input. With foreign aid and troops dropping after 2014, the country has struggled to reignite its economy.
  12. Research Gives Hope: The World Bank implemented a test program in 2015 to help improve economic outcomes for poor citizens. The program provided households in the Balkh province with a temporary stipend and financial coaching. The results showed a 20% decrease in the number of households below the national poverty line, a 30% increase in consumption, a 17% decrease in depression among women and a 53% reduction in debt. The World Bank published these findings in 2019, providing the first-ever evidence of similar targeted programs for poor areas in conflict regions.
  13. Trends Predict Further Growth: Based on current trends, the World Bank believes there is hope for further economic growth in Afghanistan. The 2019 World Bank assessment of Afghanistan confirmed prospects are looking positive for Afghanistan, with a projected 2.5% growth in 2019 and up to 3.5% growth in 2021.
  14. Continued Aid is Critical: As of 2019, grants support more than 75% of Afghanistan’s public expenditures. The U.N. humanitarian workers warn that the withdrawal of aid to Afghanistan could derail the slow but steady growth the country has experienced since 2001.
  15. The 2020 Aid Package is Under Congressional Review Right Now: The Department of State and USAID have requested approximately $532.8 million in aid for the financial year 2020. At the time of writing, this request has not yet received approval.

Concluding Thoughts

There are tangible issues that fuel poverty, and these 15 facts about poverty in Afghanistan represent only a part of the complex issues the country’s economy faces. Remember that a country is more than just its politics – it comprises people. Others can help the Afghani people through various actions in order to reduce the suffering of millions of Afghan citizens.

– Melanie Rasmussen
Photo: Flickr

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World Economic Forum on Africa 2017


In early May, South Africa hosted the 27th World Economic Forum on Africa, which promised, “achieving inclusive growth through responsive and responsible leadership.”

Various business and government leaders gathered in Durban, South Africa to discuss some of the economic challenges that Africa is facing, as well as Africa’s stance on the global economy and the fourth industrial revolution.

It is estimated that over 40 percent of people on the continent of Africa are living in poverty. The World Bank states that even the most optimistic calculations show about 330 million poor Africans in recent years. Additionally, the host nation, South Africa, has experienced sluggish economic growth recently. With all of the progress to be made in Africa, “inclusive growth” being the staple of this forum is vital, as sub-Saharan growth is at the lowest levels seen in 20 years.

This year, South African President Jacob Zuma urged the youth in Africa to aid in the realization of the Africa Union’s Agenda 2063, as it has been a focal point that the younger generation holds the key to the future of Africa.

Another key point made from this World Economic Forum on Africa was from South African’s Finance Minister, Malusi Gigabi. Gigabi warned that the Brexit and an increase in protectionism could reduce growth in Africa by reducing international trade.

One of the highest profile speakers was actor and UNESCO Special Envoy, Forrest Whittaker, whose message was regarding the young people who save lives in war-ridden communities in South Sudan.

Benedict Oramah, President of the African Export-Import Bank, pushed for an increase in intra-regional trade, as only 15 percent of African trade is region-to-region. He went on to say, “we are poor because we are not trading amongst ourselves.”

Overall, the acknowledgment of the current economic problems and the multiple plans on trade and increasing jobs for African youth are good for the reduction of poverty long term. It is necessary that these plans are held up, as some of the countries in Africa have seen the least rates of growth and poverty reduction over the past 30 years in comparison with the rest of the world.

– Dustin Jayroe

Photo: Flickr