five-trending-approaches-to-alleviate-global-povertyAlthough global poverty has been trending downwards over the past century, the COVID-19 pandemic caused an unparalleled setback to nations’ efforts to improve the well-being of their citizens. However, governments, NGOs and IGOs alike have created new strategies to get incomes back on track. Here are five trending approaches to alleviating global poverty:

5 Trending Approaches to Alleviating Global Poverty

  1. Expanding purchasing power through cash payments. The government of Niger attempted this approach for citizens living below the poverty line. A mere 24 monthly payments of $16 caused household spending power to double. This increase in spending money also allowed beneficiaries to gain more free time. Economists in this experimental trial noticed that the households tended to utilize this free time for increased productivity instead of leisure, which caused a greater increase in economic activity.
  2. Cash transfers with a larger purpose. Burundi’s cash transfer program also teaches citizens living in poverty to manage budgets, create financial goals and execute entrepreneurial goals. The cash transfers have allowed-for beneficiaries to reap the rewards of higher schooling, agricultural entrepreneurship and reduced rates of malnutrition.
  3. Trade agreements for a better-connected world. The proposed African Continental Free Trade Area is projected to raise wages by 9% and remove many barriers to trade that cause a reduction in economic activity. By 2035 this trade agreement could bring 18 million new jobs and a 32% raise in African exports.
  4. Promoting sustainability through aid. The Swiss government pledged $155 million to the United Nations Development Program’s fight to promote sustainability and alleviate global poverty. This funding allows for an increase in democratization, civic engagement and income equality.
  5. Encouraging gender equality in education. The World Bank estimates that the education gap between men and women has cost $30 trillion in lost economic activity that would have occurred if education levels were equal. Since women with a secondary education earn twice as much on average as those with no education, the correlation between wealth and education is both strong and convincing. The Malala Fund aims to utilize political advocacy to ensure that all girls across the globe can access 12 years of free education. By closing this education gap, economic activity will increase in developing nations where girls do not have access to schooling.

The economies of both developing and industrialized nations took a significant hit during the COVID-19 pandemic. However, many developing nations lacked the capabilities to remotely learn and work, which caused these nations to face even more economic turmoil than their industrialized counterparts. For example, U.S. internet penetration rates are approximately 89%, compared to developing nations such as Zimbabwe, where only 21% of citizens have access to the internet. Although there was an unprecedented upswing in poverty rates during the pandemic, strategic approaches to education equality, entrepreneurship and international aid can prevent further setbacks in the fight against global poverty.

Salvatore Brancato
Photo: Flickr

Top 10 Countries Contributing to Foreign AidIn February, the U.N. declared that 109 million people were in critical circumstances. In other words, international assistance is more important than ever. Countries around the world are fighting to alleviate global poverty, but some are doing a better job than others. Read further to find out which nations make the list for the top 10 countries contributing to foreign aid.

Top 10 Countries Contributing to Foreign Aid

  1. Luxembourg – Even though it is one of the smallest countries in the world, Luxembourg is a world leader in foreign aid. In 1970, the U.N. urged wealthy nations to contribute 0.7 percent of their Gross National Income (GNI) to foreign aid. Luxembourg was the second country to achieve this goal. Today, the government invests 1.07 percent of its GNI to foreign aid.
  2. Sweden – Contributing 1.04 percent of its GNI to international development, Sweden landed itself at the top of this list in 1974. In 2018, it was still considered the largest donor when taking into account the size of its economy. The Swedish government expects to spend nearly $6 billion on foreign aid by the end of 2019. Primary concerns regarding foreign aid include agriculture, education, global health and nutrition.
  3. United Kingdom – In 2017, the U.K. spent more than 14 billion pounds on international assistance. The largest recipient of this aid was Pakistan followed by Ethiopia and Nigeria. The majority of funding is donated to humanitarian projects. Approximately 64 percent of aid is sent directly via bilateral organizations. The remaining percentage is distributed indirectly via organizations like the U.N.
  4. Norway – In 2018, Norway revised its foreign aid policies. In the new outline, the government mandates that at least 1 percent of its GNI is spent on international assistance. The proposal also focuses on health and education as its chief concerns.
  5. Ireland – In July 2018, Ireland relaunched a new foreign aid policy aptly named A Better World. One of the primary goals of this policy is to ensure that 0.7 percent of the GNI is spent on international development. It is estimated that this target will be met by 2030. Furthermore, the policy emphasizes climate action, gender equality and strengthened governance. For female education alone, the country has committed to spending 250 euros within the next five years.
  6. Japan – Japan is the largest contributor to foreign aid in Asia. In 2018, the country donated $14.2 billion. Japan has publicly committed to using the official development assistance (ODA) for guidance in future development.
  7. Canada – Unlike other countries, Canada has taken a unique feminist approach. Its foreign aid policy uses feminism as its core value. By promoting the success of women around the world, Canada hopes to create a more equal balance in power. The country believes that an increase in women’s rights would lead to other areas of progression, such as a more inclusive government and representation for minorities.
  8. France – Within the past year, France has committed to enhancing its foreign aid policy. Currently, the country donates 0.43 percent of its GNI to foreign aid. However, by the year 2022, the French government aims to increase this level to 0.55 percent. The primary objective of this increase is to aid in international stability.
  9. Finland – In just the first part of 2019, Finland has already administered 68.35 million euros in foreign assistance. The government distributes its finances through a process that includes evaluating the extent of a crisis, assessing how many deaths and illnesses have occurred and recording the percentage of the population affected by the issue. Finland also prioritizes its aid to countries that have formally submitted a request to the U.N.
  10. United States of America – Last but not least on the list for the top 10 countries contributing to foreign aid is the U.S. The current American aid system was created in 1961. However, disputes surrounding U.S. investment have increased in recent years. President Trump has repeatedly fought for cuts in the budget while others advocate for the amount to be raised. In 2016, the U.S. contributed approximately $49 billion in foreign assistance.

Ultimately, there is still a lot of work to be done. With millions of people in crisis, it is important that the wealthiest nations help combat the issues that plague the poorest. If not for humanitarian reasons, foreign aid can help elite nations by increasing the global economy and infrastructure. When looking at success stories like China (which once was a U.S. aid recipient but now a financial leader), one can understand the impact of international assistance.

Photo: Flickr