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How Tourism in Tanzania Alleviates Poverty

Tourism in TanzaniaTourism involves traveling to locations other than one’s usual environment to participate in activities of interest. Tanzania contains many tourist destinations, including Mount Kilimanjaro, Serengeti National Park and Zanzibar beaches. As such, tourism in Tanzania remains essential to the economy of the nation and has a significant impact in more ways than one.

Tanzania’s Poverty Statistics

With a population of approximately 55.6 million people, Tanzania has one of the world’s most impoverished economies despite its previously high rates of growth and remarkable tourism industry. Tanzania’s GDP growth rate decreased from 5.8% in 2019 to 2% in 2020, meaning that Tanzania’s growth per capita became unprecedentedly negative. Furthermore, the Tanzanian poverty rate was 25.7% in 2020, which means that almost 15 million Tanzanians could not afford some or all of their basic necessities.

The Impacts of COVID-19 in Tanzania

Due to the COVID-19 pandemic, more than 140,000 people in Tanzania lost their formal jobs in June 2020. Additionally, more than two million people with informal, non-farming jobs experienced a decrease in income. Because of these pandemic job losses, more than half a million people could be pushed below Tanzania’s poverty line.

Furthermore, Tanzania’s rapid population explosion during the pandemic has resulted in an increase in the number of citizens living under the poverty line. Tanzania’s poverty rate increased to nearly 2% in the past year, meaning hundreds of thousands of people have been pushed below the poverty line since the pandemic began. According to the World Bank, “[b]ecause a large share of Tanzania’s population is close to the poverty line, even a mild economic shock can push numerous households into poverty.”

Moreover, the pandemic has halted many businesses, especially in the tourism and manufacturing sectors. However, with the new development of the COVID-19 vaccine, many people are starting to travel again, which may indicate that an economic turn-around could be in Tanzania’s near future.

Tourism in Tanzania

According to University of Dar Es Salaam students Nathanael Luvanga and Joseph Shitundu, Tanzania’s tourism industry contributes to the alleviation of poverty. In their study, they examined three popular tourist attractions in Tanzania and how the qualities of those three locations helped alleviate poverty.

The students found that tourism in Tanzania creates employment for those who live in poverty, including jobs operating hotels, providing tours, working at stores and handcrafting goods to sell to tourists. Job creation in the tourism industry is decreasing poverty rates because the skills needed to obtain employment are not specialized. This means that with proper training, anyone can excel as a tourism industry employee.

The Benefits of Tourism

As a result of positive tourism in Tanzania, the country has observed an increase in the number of people acquiring income from tourism-related jobs. With tourism and travel rates beginning to increase again, many are hopeful that more job opportunities in the tourism industry will arise.

Moreover, tourism strongly correlates with national and even international capital, which opens many opportunities to benefit impoverished citizens and further reduce poverty rates. Tourism was Tanzania’s “largest foreign exchange earner,” the second-largest GDP contributor and the third-largest employment creator, per a World Bank report. With access to numerous foreign markets, Tanzania is able to create employment opportunities for the impoverished, preserve cultural traditions through tourism, expand efforts to further develop the country and decrease poverty rates.

Tourism Alleviates Poverty

More than two million people have visited Tanzania each year to view its exquisite scenery and learn about Tanzanian culture, but tourists are unaware of just how important their visits are to alleviating poverty. Tourism creates jobs for those living in poverty, allowing many impoverished Tanzanian people to provide for their families, and therefore, lift themselves above the poverty line. Additionally, tourism allows Tanzania to use foreign capital to boost its economy, contributing to a rise in its GDP. National and international funding gained from tourism allow an expansion in efforts to eliminate poverty in Tanzania and generates more unique opportunities to benefit the impoverished.

– Lauren Spiers
Photo: Flickr

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Generation Equality Forum: Working Toward Gender Equality Around The World

Generation Equality Forum, Working Toward Gender Equality Around The WorldFrom June 30 to July 2, the United Nations Women held a global meeting in Paris consisting of representatives from around the world. This meeting was called the Generation Equality Forum and aimed to assess the progress the world has made in terms of gender equality.

What is the Generation Equality Forum?

The global meeting brought together the U.N. Women, the governments of Mexico and France and a total of 50,000 people in order to create an action plan for the immediate progress for global gender equality. The forum had some target areas that the representatives wanted to focus on discussing. These areas included gender violence, economic justice, autonomy, reproductive health, climate justice action taken by feminists and feminist leadership.

The Beijing Women’s Conference 1995

According to U.N. Women, the World Conference on Women in Beijing 25 years ago marked a “turning point for the global agenda for women’s equality,” as it resulted in the adoption of the Beijing Declaration and Platform for Action. This declaration set out goals for the advancement of women and gender equality and included a plan to meet again in 25 years to reassess. As a result, the main goal of the forum this year was to look at how far the world had come since 1995.

The 25-year review showed further global progress can be made to advance gender equality, especially amid COVID-19. In fact, studies found that countries will need to implement significant action to meet their gender equality goals by the target year of 2030. The main reason for this lack of progress: a corresponding lack of funding.

Why Decreasing the Gender Gap is Important

The COVID-19 pandemic is disproportionately affecting women. This has affected their education, employment and health. As a result, decreasing the gender gap is more important than ever today. By making women a focal point of economic recovery plans, the world can rebuild the economy equitably.

Additionally, women become affected by poverty at much higher rates than men. For example, women do almost three times the amount of unpaid work than men do, which usually involves childcare and housework. Moreover, 62% of women worldwide are active in the workforce compared to 93% of men. As a result, women from the age range 25-34 are 25% more likely to live in extreme poverty. If the world were to close this gap, the global GDP could increase by 35% on average. Helping women around the world and improving gender equality works to help all people around the world.

Looking to the Future

The Generation Equality Forum created a five-year action plan to stimulate change going forward at a quicker rate than before. This involved $40 billion of investments and commitments from various governments and organizations. Some of these commitments include:

  • U.S. government’s commitment of $175 million to prevent and address gender violence
  • Malala Fund’s commitment of $20 million for girls education activists
  • Open Society Foundation’s commitment of $100 million over five years for feminist political mobilization
  • Government of Bangladesh’s commitment to increase women participation in technology to 25% by 2026
  • Implementation of free care for pregnant women in Burkina Faso

The Generation Equality Forum helped countries, agencies and organizational renew global commitments to gender equality goals. While there is still a long way to go to achieve gender equality around the world, the forum has made progress in setting specific, concrete goals for countries to strive toward.

Closing the gender gap will help to raise women around the world above the poverty line and stimulate economies around the globe. It is pertinent that the world continues to fight for equality and make progress as they have with this forum.

– Alessandra Heitmann
Photo: Flickr

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9 Facts About NGOs and Healthcare in Dominica

Dominica, a small country in the Caribbean, has a population of about 72,000. Currently, general taxes are what finance healthcare services in Dominica. There are seven healthcare centers and 44 clinics around the country that provide primary healthcare at no cost.

 9 Facts About Healthcare in Dominica

  1. Dominica spends equivalent to $418 per capita on healthcare. As of 2011, healthcare costs were 4.2% of the GDP. Those healthcare services are provided by the Ministry of Health. Also, as of 2017, there were 1.1 doctors per 1000 people in Dominica.
  2. There are five hospitals in Dominica. Four of these hospitals are government-owned, while the other one is privately owned. The Princess Margaret Hospital has one small intensive care unit, meaning it is most equipped to deal with emergency situations. However, the other three, the Marigot hospital, Grand Bay hospital and Portsmouth hospital, are not as prepared.
  3. Dominicans generally have somewhat long lifespans. For men, life expectancy is 74.4 years, and for women, it’s 80.5 years. Therefore, the total average life expectancy is 77.4 years, exceeding the global average of 72 years. However, as of 2019, 30.9 infants died out of 1000 live births, which is a rate of about 3.29%.
  4. There are both primary and secondary healthcare services in Dominica. There are seven health districts in which primary healthcare services are provided by clinics. These clinics serve about 600 people each within a 5-mile radius of the district in which they are located. Princess Margaret Hospital provides secondary healthcare to the people of Dominica.
  5. Some individuals are exempt from charge for medical treatment. Those who are considered poor or needy, pregnant women, children younger than 17 years old  are exempt from the medical care charges. People who may also have an infectious and contagious disease that can spread through multiple ways (such as bodily contact, contact with bodily fluids, or breathing in the virus) are also exempt from the charges that arise from medical care.
  6. The HIV/AIDS prevalence rate is 0.75%. About 506 people out of a population of 72,293 people in the Dominica have HIV/AIDS. Countries that have a prevalence rate of HIV/AIDS that exceed 1% are considered to have Generalized HIV Epidemics, so Dominica is currently below that even though its rate is higher than places like the U.K. 70% of those infected by HIV/AIDS are male. In 2019, only 95 adults and children were receiving antiretroviral therapy in Dominica.
  7. The Citizenship By Investment program in Dominica helps rebuild medical buildings and infrastructure, as well as provide treatment abroad. After Hurricane Maria in 2017, the CBI program helped fund the rebuilding of six hospitals and three healthcare centers in Dominica. Similarly, the program also sponsored 16 children to receive treatment abroad in 2017-2018. The treatment was critical for the of health of the children in Dominica.
  8. The Order of St. John is an NGO project working to improve healthcare in over 40 countries, including Dominica. This international charity has over 300,000 volunteers and staff and provides multiple services such as healthcare, first aid and other methods of support. This organization, registered as an NGO in 1964, had an income of 1.44 million pounds in 2018. Its mission is to help improve the health of people around the world and alleviate worldwide sickness. Additionally, St. John works to provide volunteers with disaster preparedness training in Dominica in the case of tropical storms or other natural disasters. The organization accepts donations, 100% of which go to their programs.
  9. Another NGO, EACH, also works in Dominica to provide healthcare communication. EACH works to promote healthcare communication that is concentrated around patients. EACH also works to provide healthcare communication research, skills and tools. They strive to ensure that patients worldwide receive specialized care with regard to autonomy and safer, efficient healthcare, as well as ensuring that patients are more likely to recover from diseases. EACH became a nonprofit and charity organization in 2014.

Many organizations and hospitals are working to provide effective healthcare in Dominica. The general public can help assist these organizations through donations or volunteering. Learning more about healthcare in Dominica, as well as in different countries around the world, can help one understand both the domestic and global situation of healthcare today.

– Ayesha Asad
Photo: Unsplash

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How the EVFTA will Create New Opportunities for Trade

Global MarketAfter ten years of negotiation, the European Union Vietnam Free Trade Agreement (EVFTA) came into action on August 1, 2020. The deal will reduce tariffs by 99% over the next 10 years and will provide relief from the economic drops caused by COVID-19. The market contains over 500 million individuals and is valued at 18 trillion USD. The trade relationship will enable Vietnam to compete in the global market better, especially against markets like Japan and South Korea. Currently, out of all of the countries in the Association of Southeast Asian Nations (ASEAN), Vietnam is the European Union’s (EU) second-largest trade partner behind Singapore. Compared to its regional rivals of Indonesia and Thailand, Vietnam has a stronger trade relationship and involvement in the global market.

Vietnam and the EU Ties

For exports, Vietnam relies on the EU as its largest partner. Vietnam’s exports to the EU are larger than any other ASEAN country. A World Bank study found that from 2001 to 2018, Vietnam’s exports to the EU have grown annually at an average rate of 16%, gaining it a trade surplus over the EU. According to the European Commission, these exports are mostly textiles and clothing, agriculture products like coffee, rice, seafood, electronic products, telephone sets and more.

As the agreement is implemented, both countries could see a rise in GDP and new job opportunities, amongst other positive effects. More immediately, Vietnam’s GDP will increase by 2.18-3.25%, said the Ministry of Planning and Investment. Unlike most countries, Vietnam will see positive economic growth this year – estimated to be up by 4.8%, according to a study by the World Bank. In 2030, Vietnam will see a 6.8% growth in its GDP.

Both countries will have large growths in their exports. The EU could see a $16.9 billion per year increase in exports by 2025. Vietnam is expected to increase exports by 42.7% in the first five years of the deal, mostly in farm produce, manufacturing and services. Additional domestic reforms by Vietnam could raise productivity and further increase GDP by 6.8% in the next 10 years.

Vietnam’s Participation in Global Value Chains

As Vietnam increases trade with other countries through agreements, it will become more involved in the global market. Further globalization will also push Vietnam to participate more in global value chains (GVCs), shifting away from the manufacturing market from China. The bilateral treaty signed between Vietnam and the EU will also ensure that electronics and electrical equipment (a large portion of current imports) comes to Vietnam exclusively from the EU.

Due to this shift, the EU has increased its foreign direct investment in Vietnam. The EU already was the largest foreign investor in Vietnam, with a total of 6.1 billion euros endowed as of 2017, mostly into processing and manufacturing. This investment will go towards new jobs and increased productivity by reducing the number of imports to Vietnam and shifting towards in-house production for higher gains.

To be eligible to avoid tariffs, Vietnamese products must not contain imports from other countries. In addition, agriculture must meet requirements for sanitation, meaning farmers will have to refine their growth system. The deal places especially tight regulations on the quality of agricultural and manufactured products shipped by Vietnam, pushing technological developments in order to avoid drops in efficiency.

Poverty Reduction

Over the past two decades, Vietnam has made steady progress in reducing extreme poverty. From 1992 to 2018, Vietnam’s GDP per capita increased by more than four times, pulling extreme poverty rates from 52.9% down to 2% of the population. EVFTA will continue this trend. A World Bank Study found that EVFTA is expected to reduce extreme poverty (less than $1.90 per day) by 0.1-0.8 million people by 2030, 0.7% more than the poverty-reduction rate without the agreement. Overall, this will amount to an 11.9% decrease. In addition, poverty at $3.20 per day is expected to reduce from 8% to 3.5%.

Vietnam has now broadened its poverty baseline from $1.90 to $5.50. From 2016 to 2030, developments caused by EVFTA will influence this poverty rate to drop from 29% to 12.6%, allowing Vietnam to achieve upper-middle-class status. In addition, the income gap between genders will be decreased by 0.15 percent. This difference affects low-income families the most, as they are traditionally involved in manual labor jobs where this is most prevalently seen.

This agreement will open up new territories for both the EU and Vietnam to expand into. Vietnam’s primarily agricultural economy might see large shifts into one of manufacturing and processing. This agreement is a stepping stone for Vietnam’s involvement in the global market, and it might be a sign of large changes to come.

– Nitya Marimuthu
Photo: Pixabay

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Inflation in Venezuela

inflation in Venezuela

Venezuela has been in a decades-long economic crisis. Its economic decline is historically marked by el Viernes Negro or Black Friday. Black Friday took place on February 18, 1983, when the nation’s bolivar began depreciating in value. Inflation in Venezuela has been rising ever since. Recent hyperinflation in Venezuela has caused mass poverty across the nation. The result have been shortages of food and medical supplies and an unemployment rate of 35 percent as of December 2018.

Origins of Depreciation

In order to understand potential ways to alleviate Venezuela’s rising inflation rates, it is essential to understand how the economy reached this point. Back in the 1970s and early 1980s, Venezuela was a flourishing oil tycoon in possession of some of the world’s largest oil deposits. A worldwide shortage of oil raised the prices of barrels and created a golden period of economic growth for oil giants like Venezuela. Once the 1980s rolled in, oil prices stabilized. People started looking for more affordable, alternative energy methods.

This was detrimental to Venezuela’s economy since there was less demand for oil. Heightened production due to the previously increased oil prices left Venezuela with an abundance of oil produced and less demand. Venezuela’s reliance on exporting oil became its undoing. The price of oil continued to drop as the years progressed. Venezuelan oil production continued to exceed the actual demand. Inflation in Venezuela began here as the nation struggled to adapt in the face of failing exports.

Worsening Factors

Several factors contributed to the inflation of the Venezuelan bolivar. One factor was increased spending on social welfare programs and the importation of basic goods during Hugo Chávez’s presidency. While these actions helped to alleviate social unrest, this type of spending couldn’t be sustained as the oil-based economy tanked. In 2008, the global price of oil dropped to around $34 dollars per barrel, a record low that severely cut Venezuela’s core income. In 2014, another record low sealed Venezuela’s economic down spiral as the nation could no longer rely on its chief export for a means of financial stability.

However, this did not deter spending on welfare programs and imports, which led the nation into deficit spending. Deficit spending continues to be a major factor in increasing inflation in Venezuela. The further the nation falls into debt, the more the value of the bolivar depreciates. Currently, the full value of Venezuela’s debt is exceeds “the value of its exports” by 738 percent. Because of its massive debt, the U.S. implimented trade restrictions in early 2019. This has further decreased the sales from exports and the nation’s gross revenue.

Currency printing has been another cause of inflation in Venezuela. In order to pay for the importation of basic goods, more money has and is being printed by banks and the government. The value of the bolivar depreciates the more that is printed. It should be kept in mind, however, that these aren’t the only factors in inflation. The situation is deeply complex, spanning over decades of domestic mismanagement and failing international relations.

Qualifications for Hyperinflation

According to Forbes, a nation’s economy reaches hyperinflation once its monthly inflation rate surpasses 50 percent for a full thirty days. Once that inflation rate drops below 50 percent for another full thirty days, it is no longer in hyperinflation. Venezuela has been in a continued episode of inflation with some peaks of hyperinflation since November 2016.

Because of the longevity of Venezuela’s financial crisis, the nation’s economy is considered to be in hyperinflation. According to the International Monetary Fund, Venezuela’s GDP will drop another 25 percent by the end of 2019. The projected inflation rate by the end of 2019 will surpass 10 million percent.

Alleviating Inflation

Despite the economic down spiral in Venezuela, there is a potential solution that is common across business analysts. Forbes and Bloomberg Business both suggest that Venezuela adopts “dollarization.” This means abandoning the domestic currency in favor of foreign currency. Dollarization allows the economy to stabilize as Venezuela could leave behind the bolivar and adapt to an already stable foreign currency.

The reasons for inflation in Venezuela are numerous. There are some solutions out there, but they have yet to be implemented. In this case, adopting the American dollar may be the best approach to curb the rising inflation in Venezuela and reduce the poverty caused by inflation.

– Suzette Shultz
Photo: Flickr

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Bhutan’s Gross National Happiness Index

Bhutan's Gross National Happiness Index

The traditional tool to measure the success of a nation is by its Gross Domestic Product (GDP). GDP refers to the total value of goods produced and services provided by a country in a given year. GDP can provide an accurate depiction of the economic success of a nation, but it does not measure true fulfillment and well-being properly. An alternative measure of success is Bhutan‘s Gross National Happiness Index.

Humble Beginnings

Bhutan’s government has a long history of striving for its peoples’ happiness. King Jigme Singye Wangchuck, King of Bhutan from 1972 to 2006, made it his goal to increase the overall happiness and well-being of the Bhutanese people. The King declared that “Gross National Happiness is more important than Gross National Product,” and in doing so, coined the phrase “Gross National Happiness.”

Moreover, King Jigme Singye Wangchuck developed a set of procedures that could produce an accurate measurement of happiness, Bhutan‘s Gross National Happiness Index. The concept behind the Gross National Happiness (GNH) Index is that well-being should not solely be based on economic success and that development cannot be sustainable without accounting for the more holistic aspects of progress.

Gross National Happiness in Practice

Bhutan’s GNH Index consists of nine different domains: 1. Psychological well-being; 2. Health; 3. Education; 4. Time use; 5. Cultural diversity and resilience; 6. Good governance; 7. Community vitality; 8. Ecological diversity and resilience; and 9. Living standards. Including all nine domains in the overall evaluation of happiness and well-being allows for the Bhutanese government to implement policy that is designed to target the domains where improvement is needed most. The GNH Index can also be broken down by demographic groups, allowing comparison between men and women or districts. Each of the nine domains is determined by examining 33 different indicators, giving leaders a comprehensive understanding of the various aspects that contribute to well-being.

GNH is the main tool used to ensure that development does not come at the expense of the Bhutanese people. Bhutan has grown as an economic power in recent years with an increase in large-scale hydropower projects, but the downside to this growth is that many rural workers and farmers have been displaced on account of these projects. Therefore, Bhutan has made it a priority to see that GNH and GDP can grow and exist in harmony.

Growth as a Result

Since GNH was adopted as the main measure of growth in Bhutan, almost 100 percent of its children are enrolled in school and the country has nearly doubled its life expectancy. Educational policy has also been affected by GNH principles. Children now learn about agricultural practices and environmental protection alongside math and science. Meditation is also a typical part of the school day as well. In addition, the country’s waste-management program ensures that all materials used in schools are recycled.

Journalists caught wind of this small Himalayan nation committed to increasing the happiness of its people, and with increased coverage, the ideas behind Bhutan’s GNH Index spread across the world. Well-being and happiness conferences increased in almost every part of the globe, and in 2012, the UN decided to follow Bhutan’s example in taking a more holistic approach toward development, making the GNH Index their main development indicator, a decision which was backed by 68 different countries.

Thanks to Bhutan, the world’s definition of what a successful country is may be changing. While GDP is still widely used as a measure of development, the use of Bhutan’s Gross National Happiness Index is increasing in popularity right alongside it.

– Ryley Bright
Photo: Flickr

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Five Facts About Development in Tajikistan

development in Tajikistan

Tajikistan is a country located on the frontiers between Europe and Asia. This largely unheard of, mountainous country has a population of more than 8.6 million with an average GDP per capita of around $3,200, placing it near the bottom of the global ranking. However, over the past few years, the GDP of Tajikistan has grown between 6 and 7 percent. This article will address five facts about development in Tajikistan, including the challenging areas and opportunities that the country faces.

Five Facts About Development in Tajikistan

  1. Geography: Tajikistan’s geography is impugning its development since more than 90 percent of the country is mountainous. If fact, much of the land lies above 3,000 meters in altitude. Subsequently, the population is largely rural and widely dispersed, complicating infrastructural developments. However, as a result of this landscape, the majority of Tajikistan’s electricity production comes from hydroelectric power. The system is still largely inefficient though, especially in winter months. Users reporting shortages up to 70 percent of the time in winter months. Recent efforts have sought to address the gaps in provisions. In March 2019, the World Bank agreed to finance the rehabilitation of the Nurek Hydropower Plant, which generates 70 percent of the country’s energy demand. The rehabilitation should increase the plant’s winter generation by 33 million kWh, allowing it to meet winter energy demands and become a net exporter of energy in summer periods.
  2.  Government Policy: According to the U.S. State Department, Tajikistan is a country of ‘high risk’ but ‘high reward’ investment. Despite its consistent low ranking on the Freedom House Index, which measures civil and political rights, continual economic reforms have increased its Economic Freedom and promoted more investment. These reforms helped Tajikistan officially join the WTO at the end of 2013 after the changes made in property and investor rights. The 2019 ‘Doing Business’ World Bank report stated that Tajikistan had increased its rank overall by taking steps to participate more in the regional economy. Through the Simplified Customs Corridor agreement, Tajikistan has improved customs clearance with Uzbekistan. Based on the international classification, the poverty rate is projected to fall to 12.5 percent by 2020.
  3. Labor Migration: Due to the lack of employment opportunities, Tajikistan has a negative net migration rate, meaning that there are more people leaving the country than entering it. Most of the migrants are working-age men going to work in Russia. In 2015, worker’s remittances accounted for around 29 percent of Tajikistan’s GDP. But, this dependency means that Tajikistan’s fiscal health dropped from 95.8 percent to 60.3 percent in the period from 2016 to 2017 as a result of Russia’s economic downturn. To increase the opportunities for the workforce, the International Labour Organization has launched a pilot project aimed at strengthening National Skills Development systems as part of the ‘G20 Training Strategy’. Although it only has 1,460 participants so far, the updated frameworks could help increase Tajikistan’s current low productivity.
  4. Gender Disparities: In Tajikistan, women face a number of barriers to succeed economically, gain access to education, find employment or receive healthcare. They receive fewer years of schooling than their male counterparts and earn approximately 60 percent of what men do. However, with a migrating male workforce, female participation in the economy could be beneficial for economic development in Tajikistan. With help from funding from U.N. Women, the Tajikistan National Business Association for Women runs a number of training programs to improve employment opportunities for women. From 2015 to 2018, 3,200 women received training in business and 2,200 women received training in vocational areas. The organization also runs a bi-annual women-only entrepreneurship competition, which received more than 700 applications in both 2016 and 2018.
  5. Border Problems: Tajikistan shares a 750-mile long border with Afghanistan, one of the world’s largest opium producers. Consequently, illegal drug trafficking in Tajikistan is estimated to be worth around 30 percent of the GDP. However, the Project for Livelihood Improvement in Tajik-Afghan Cross-border Areas (LITACA) is one of a number of projects seeking to enhance cross-border cooperation between Tajikistan and Afghanistan, especially for women entrepreneurs. The Government of Japan finances this initiative, and the UNDP Tajikistan implements it in order to add stability and security to the region and ease border tensions. This program introduced around 25 socio-economic projects between 2014 and 2017, boosting economic growth to 45,000 people on both sides of the border. The project improved direct access to “schools, hospitals, irrigation, drinking water, energy supply, roads and bridges” for more than 388,000 people.

Tajikistan faces a number of barriers to its economic development. However, these five facts about development in Tajikistan show that important work is being done. There are many opportunities for growth. Economic reforms and continued investment could change the lives of the hundreds of thousands affected by poverty.

– Holly Barsham
Photo: Unsplash

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Increasing Credit Access in Bulgaria

Credit Access in Bulgaria
Bulgaria is an Eastern European country with a population of approximately 7 million people. In 2016, the country’s poverty rate stood at 23.4 percent, which means that around 1.6 million Bulgarians lived below the national poverty line. In addition, Bulgaria has the lowest GDP per capita in the European Union and the highest levels of income inequality among E.U. countries. Increasing credit access in Bulgaria could be one way to recharge the economy and help reduce poverty.

Background

Poverty in the country has been steadily rising. Since 2000, the poverty rate has increased by 9.4 percent. Contradictorily, the unemployment rate has never been lower and wages have never been higher than they are now. To explain this contradiction, it is important to know that Bulgaria has experienced a rapid population decline. Between 1988 and 2018, the population of Bulgaria declined by nearly 2 million people. By 2050, economists predict that the Bulgarian population will fall to 5.5 million if the country does nothing to reverse the trend. This has precarious implications for the nation’s economy, and increasing access to credit is a viable solution to stymie population loss.

Particularly concerning is the fact that young and educated Bulgarians constitute the bulk of those leaving the country. In most cases, they leave to find employment elsewhere in the E.U. Some dubbed this phenomenon a “brain drain,” and studies confirm that it hinders economic growth and development. Experts at the Institute for Market Economics in Bulgaria argue that political stability and economic growth are the surest ways to dissuade young people from leaving the country; in other words, the overall outlook for the country must be bright.

Credit Access in Bulgaria

One possible way to address Bulgaria’s population problem is to increase access to credit. With increased credit access, impoverished Bulgarians can secure the funding they need to start a business, purchase a home or own a car. Expanding credit for small businesses could be due to economic growth. Furthermore, a 2006 study found that increased credit access in Bulgaria had a strong correlation with total factor productivity. Credit access has also led to growth in both the manufacturing and service sectors. A Georgia State University study found that access has led to a 0.34 percent annual increase in value for both sectors. These sectors account for 83 percent of Bulgaria’s GDP.

By further developing access to credit, Bulgaria has a brighter economic outlook. Despite its population decline, the GDP has increased by $52 billion since 2000. In order to reverse the brain drain and address national poverty, financial institutions and the Bulgarian government should continue to invest in credit access. Credit access will allow young entrepreneurs to remain in the country, helping the economy grow and encouraging Bulgarians. Economic growth, according to the Institute for Market Economics, remains Bulgaria’s best chance at recovering its lost population.

– Kyle Linder
Photo: Flickr

Global Metrics Create a Better Understanding of the World

Global MetricsWhile there are many websites that offer a detailed analysis of the problems facing the world’s poor and their solutions, a deeper understanding of global metrics and indexes will help curious supporters conduct their own research and make informed decisions on the economic, political and social statuses of impoverished countries around the world. Often times, a combination of multiple indicators from multiple governmental and NGO bodies is necessary to form a full picture of a country’s attitudes towards impoverished populations, the economy and governance.

The Three Main Global Metrics

To understand the economy of a country, researchers will look at global metrics such as gross domestic product (GDP), Gini index and the unemployment rate. The GDP is a broad metric measuring the total value of goods produced in the domestic market of the economy. The Bureau of Economic Analysis (BEA) cites the GDP as “the most popular indicator of [a] nation’s overall economic health.” What the BEA fails to mention is that GDP ignores wealth inequality, quality of life and overall happiness of the labor force.

The Gini index, on the other hand, measures only income inequality. The Organization for Economic Co-operation and Development (OECD) defines the Gini index as “the extent to which income…among individuals or households within an economy deviates from a perfectly equal distribution.” Scores closer to 100 indicate a more unequal society while a score closer to zero indicates a more equal society.

The unemployment rate measures more than just the amount of population able to work but not working. More specifically, it measures the number of people in the labor force looking for a job but who remain unemployed. These three indicators working together can paint a more accurate picture than one alone, but without indicators of political and social health, the overall analysis of a country remains foggy.

Other Important Global Metrics

To better understand the political situation of a country, readers can consult indexes and indicators from a multitude of NGO and governmental watchdogs.

  1. Freedom House creates a comprehensive guide to the status of democracy in each country yearly. Freedom House breaks down its analysis into three categories: “freedom rating, political rights and civil liberties.” Along with these three categories, Freedom House also offers an overview of the key issues facing a countries democracy or lack thereof.
  2. The Economist also offers a comprehensive Democracy Index, which takes into account five categories. These include the “electoral process and pluralism; civil liberties; the functioning of government; political participation and political culture.” Freedom House ranks countries from free to not free whereas The Economist ranks each country in a list that helps give global context to each situation.
  3. The U.N.’s Human Development Index (HDI) measures indicators of social happiness to round out the political and economic indicators and give a completely holistic view of a country. HDI takes into account a number of complex factors but, in short, it consists of “a summary of average achievements in key dimensions of human development [such as] a long and healthy life, being knowledgeable and [having] a decent standard of living.” With a broad scope, HDI can look at metrics that other indexes cannot, such as education and life expectancy. Along with HDI, the World Happiness Report (WHR) offers a holistic analysis of how politics, economics and other indicators of happiness can shed light on a particular country or region. The WHR reports that they “focus on the technologies, social norms, conflicts and governmental policies” that change reports of happiness.

Overall Data Collection

A good place to start for general research into specific countries is the CIA World Factbook. The Factbook includes a summary of the country in question and will provide global metrics mentioned such as GDP, ethnic groups, population growth rate, government type and even electricity access. Global metrics are relatively intuitive, but using only one will offer a narrow view into a specific sector of a countries society.

For instance, according to the CIA World Factbook, the real GDP growth rate of Ethiopia is the fifth highest in the world in 2017, but 29.6 percent of the Ethiopian population lived below the poverty line and the unemployment rate was ranked 180 out of 218 countries studied. Just looking at the real GDP growth rate would lead to the assumption that the economy of Ethiopia thrives and that all members of society benefit from the expansion. However, other global metrics tell a different more concerning story.

Freedom House, along with its democracy in the world report, also operates a number of programs around the world in the interest of freedom. Freedom House’s “Latin America Program” seeks to help “citizens defend their rights against government abuses in Latin America and the Caribbean.” Freedom House has similar programs in both Southeast Asia and sub-Saharan Africa that work towards the political rights of citizens through improving factors such as the rule of law and civic knowledge and engagement. In this way, Freedom House goes beyond just identifying factors that exacerbate global poverty. It goes a step further and also implements programs to fight it.

Having a well-informed viewpoint on the factors that allow for systemic ills in nations across the world helps supporters make informed decisions about how to combat global poverty whether through advocacy, donation or personal action. Some NGOs go beyond observing and documenting poverty to implementing plans to combat it. Whichever approach is used, global metrics help people to stay informed from many different approaches to help enact change.

– Spencer Julian
Photo: Flickr

Uzbekistan’s Poverty Rate

Uzbekistan Poverty RateAfter separating from the Soviet Union in 1924, Uzbekistan is finally getting its economic footing. This country has struggled with transitioning to a market economy, but it has finally found a solution. Because of this, Uzbekistan’s poverty rate has slowly been decreasing over the years. It has declined from 33 percent in 2004 to its current rate of just 12.8 percent in 2017.

Although Uzbekistan has successfully decreased its poverty rate, the country still faces the challenge of creating more jobs to keep the poverty rate down. Many urban cities – where most of the population live – lack adequate employment opportunities. An unsteady unemployment rate, high cost of basic necessities such as food and low wages are major factors contributing to the poverty rate in Uzbekistan.

Uzbekistan boasts 92.3 points out of 100 for food production stability and 88.5 points for quality, meaning the country does not have a problem producing high-quality food products. The problem is that the low wages plus the high cost of food mean many residents cannot afford to buy this high-quality food. In fact, 75 percent of the population has a low income. Because of this, the country reports high rates of iron, folic acid and vitamin A deficiencies in its citizens living in poverty.

Thanks to the overall economic growth, a decrease in unemployment and a rise in the labor force have contributed to the decrease in the Uzbekistan poverty rate. In fact, the GDP has steadily increased in the last decade. In 2016, the GDP was estimated at $67.22 billion, a rise from 2014’s $63.067 billion.

Uzbekistan’s poverty rate now ranks seventh compared to its neighbors. It follows countries such as Afghanistan (39.1 percent), Armenia (29.8 percent), and Georgia (20.1 percent).

Although Uzbekistan has a long way to go to completely eradicate poverty, Uzbekistan’s poverty rate has significantly decreased over the years. Continuing to create suitable jobs for urban residents while increasing the GDP will help the country maintain its steady poverty decline.

– Amira Wynn

Photo: Flickr