WASHINGTON, April 15, 2011 — Two-thirds of developing countries are on track or close to meeting key targets for tackling extreme poverty and hunger, the World Bank and IMF said today.
This year’s Global Monitoring Report 2011: Improving the Odds of Achieving the MDGs delves into country performance and reveals a diverse, and often hopeful, picture. For example, among developing countries that are falling short on the Millennium Development Goals, half are close to becoming on-track. With improved policies and faster growth, these countries can still achieve the targets in 2015 or soon after.
“Reaching the MDGs is a significant achievement for developing countries. But there still is much to do in reducing poverty and improving health outcomes even in the successful countries,” said Hans Timmer, director of development prospects at the World Bank. “Donors should build on this success and help countries make the next step through investments in effective service delivery.”
On the whole, the fight against poverty is progressing well. Based on current economic projections, the world remains on track to reduce by half the number of people living in extreme poverty. The number of people living on less than $1.25 a day is projected to be 883 million in 2015, compared with 1.4 billion in 2005 and 1.8 billion in 1990. Much of this progress reflects rapid growth in China and India, while many African countries are lagging behind: 17 countries are far from halving extreme poverty, even as the aggregate goals will be reached.
Developing countries will also likely achieve the MDGs for gender parity in primary and secondary education and for access to safe drinking water, and will be very close on hunger and on primary education completion. But progress is slow and targets may be missed on others. Among developing countries, 45 per cent are far from meeting the target on access to sanitation; 39 per cent and 38 per cent are far from the maternal and child mortality targets, respectively.
“Good macroeconomic policies remain crucial to progress toward the MDGs,” said Hugh Bredenkamp, deputy director of the IMF’s Strategy, Policy, and Review Department. “The challenge in low income countries is to sustain and accelerate growth through better policies that will create jobs and greater opportunities for the private sector. Advanced economies need to do their part to secure the global recovery, by repairing and reforming their financial systems and tackling their fiscal imbalances.”
In some countries, it will be important to focus on support for the world’s socially excluded groups, including indigenous people as well as ethnic and linguistic minorities. Most MDG indicators among these groups are far worse than in the general population, especially in terms of income poverty.
To better understand results on the ground, the report presents findings and lessons from impact evaluations in health and education. Such evaluations often show development assistance for health and education has risen to unprecedented levels in volume, but has not generated the expected improvements in outcomes.
Delfin Go, lead economist at the World Bank and lead author, said, “Certain health and education outcomes are disappointing, in part because spending has focused largely on increasing the quantity of services, while not paying enough attention to quality. A key lesson is that strengthening institutions and improving incentives, for example, by enhancing the role of performance in setting the pay of health workers, are vital to better outcomes.”
Brad McDonald, deputy division chief and IMF coordinator for the report, emphasized that economic growth continues to be a major factor in reaching the MDGs. “Although the recent crisis set back progress, many low-income countries that had strong macroeconomic policies were able to soften the impact of the crisis with active tax and spending policies,” he said.
Regaining momentum toward achieving the MDGs will require international cooperation on three fronts. First, low income countries in particular will need a strong and stable global economic environment in which to continue growing. Second, actions are needed to help low income countries achieve and sustain more rapid economic growth and restore their policy buffers. Third, fragile states lag the furthest behind in reaching the MDGs and require additional support, to help in building institutions and moving toward a virtuous circle of development, peace, and security.
Growing assistance from emerging donors, many in the developing world, is welcome but will not compensate fully for a significant fall in aid from traditional donors, especially if they pursue different development priorities and practices. This changing aid landscape could also have implications for the transparency of official flows and the policies and programs that aid supports.
In the wake of the recent global financial crisis, trade has started to recover, but sustaining it will require steps to strengthen the international system, guard against protectionist tendencies, and push for a conclusion of the Doha Round of international trade negotiations. In addition, the report calls for measures to support access to trade finance and trade facilitation to connect vulnerable low income countries, landlocked economies and lagging regions to regional and international markets.