TFF Associates & Themes Blog

By Jonathan Power

We all know the clichés: Is the glass half full or half empty? Is the light in the tunnel the train coming towards you? But this time the new World Bank figures for the decrease in Third World poverty are absolutely clear. The glass is filling up. The train is not going to crash into us. The doomsayers from Malthus in 1798 to Ehrlich’s “The Population Bomb” to the Club of Rome to some of the activists at World Trade meetings and to the UN’s Food and Agriculture Organisation which in a quite recent mistake it now admits to, reported that the number of hungry people soared from 875 million in 2005 to one billion in 2009, have been proved to be wrong.

Poverty is on a world-wide decrease – in Asia, the Arab world and in Latin America at a fast clip. In Africa less fast.

The World Bank calculates its figures on a three year basis, but only measures up to 2010. However, preliminary evidence suggests that the downward path in poverty over the last 18 months has decreased even further. Nevertheless, those who say “statistics, damned lies and statistics” have a bit of a point.

In Nigeria where the economy is doing very well the rate of poverty has actually risen. When I asked the IMF representative why, he said the experts didn’t know. It doesn’t make sense, he said – agricultural production is increasing steadily and most people still live off the land. In Nigeria I prefer, when measuring poverty, to look at the rapid increase in mobile phones. Out of a population of 160 million 120 million have them.

Black Africa, in fact, has seen the largest turnaround in the number of its poor. Between 1981 and 2005 the number rose, almost doubling. But in 2008 it fell by 5% and is now falling steadily. In Latin America the number of poor rose until 2000 when the trend was sharply reversed. In Brazil under its last president, Ignacio “Lula” da Silva, it fell dramatically.

Global poverty has fallen by a half between 1990 and 2010. Thus it has met the target of the UN’s Millennium Development goal five years early.

China is the star, accounting for half of the long-term rate of decline. Since 1981 it has taken 660 million people out of poverty.

India too has had a lot of success under the reforming zeal of the present government of Manmohan Singh. A report by Kotak Mahindra Bank says that in rural areas, which account for 20% of the country’s economy and 70% of its people, the growth rate per annum was 17% in recent years.

A quick round up: In East Asia 77% of its population lived on an income of below $1.25 a day in 1981. Today it is 14%. In the developing world outside China it has fallen from 41% to 25%. In South Asia from 61% to 36%. In the Middle East and North Africa from 16.5 m people to 10.5 m. In black Africa for the first time less than half its population live with an income below $1.25% a day.

Even with the economic turbulence of the last few years poverty rates have continued to fall thanks to the counter-cyclical, Keynesian, policies practised by a majority of Third World countries.

Nevertheless, by the year 2015 there will still be around 1 billion people living on less than $1.25% a day. If one pushes the cut-off point up to $2.50 a day Third World progress is much less dramatic.

These overall statistics hide some highlights. According to the UK’s Overseas Development Institute, 4 more million children are living beyond their fifth birthday than in 1990. Imagine what this means to parents! The progress has been most remarkable in Brazil, war-torn Vietnam and yesterday’s basket case, Bangladesh.

Stunted mental and physical development as a result of malnutrition dropped by more than a quarter between 1990 and 2008. 131 countries now have immunization coverage of more than 90% for diphtheria, polio, tetanus and measles.

Aid is a big factor when it is combined with good governance, commitment, well planned programmes and technological innovation. In sub-Saharan Africa the countries which received the most aid made the most progress with children.

The BBC reported recently that the Millennium Development goal on pure drinking water has now been reached well ahead of its target date of 2015. 89% of the world’s population has access to improved water supplies, up from 79% in 1990. Nevertheless, in black Africa 40% don’t have it and worldwide almost 800 million people still drink dirty water. Improved sanitation is improving slowly – in India half the population don’t have access to a decent toilet.

The train with the light is not going to smash into us. It may not run on time every day but five days out of seven it is.