Op-ed: Pursuing More Growth, Less Poverty and Hunger in an Uncertain World

September 21, 2010

Robert B. Zoellick, President of the World Bank Group The Express Tribune on Saturday, September 18, 2010

The drive to overcome extreme poverty and hunger has been at the heart of global efforts to achieve the Millennium Development Goals (MDGs) since their adoption a decade ago. Until the food, fuel and financial crises in the last two years, developing countries were making progress in overcoming poverty.

In 1981, 52 percent of people in developing countries lived in extreme poverty; by 2005, that share had fallen to 25 percent. Country efforts were paying off right up until the crises, with poverty falling sharply in East Asia, Latin America and in Eastern and Central Europe.

But this progress has not been shared by all. Sub-Saharan Africa continues to lag in overcoming poverty. Hunger and malnutrition rates have been falling, but not fast enough to meet the goal of eradicating hunger by 2015. Too many of the world’s people remain hungry, poor, or vulnerable to poverty, with too few jobs and too little access to services and economic opportunity.

The crises only made things worse. The World Bank estimates that 64 million more people were living in extreme poverty (below $1.25/day) in 2010, and that by 2015, 1.2 million more children under 5 may die, 350,000 more students may not complete primary school, and about 100 million more people may remain without access to safe water.

The food crisis of 2008 may seem to be a distant memory. But it has not gone away. For the first time in history more than 1 billion people go to bed hungry each night.

We must therefore redouble efforts to target support to the poor and vulnerable.

Investments all along the food chain to increase agricultural productivity and produce will not only help to alleviate hunger. It will also contribute to overcoming poverty because 75 percent of the world’s poor live in rural areas in developing countries. Most depend on agriculture for their livelihoods.

Low-income countries need to build better safety net programs to protect their poorest people while also equipping them to develop their skills so as to move out of the poverty trap and into well-paying jobs.

The world economy is undergoing an uneven and uncertain recovery without the surge in jobs that people need. We must recover lost ground and step up the pace to overcome poverty. Developing countries offer abundant opportunities for investments with healthy returns (including in infrastructure that removes roadblocks to growth) that can create new sources of global demand. The growth potential is not limited to only a few emerging markets. Better policies have improved growth performance and opportunities in many low-income countries, including in Sub-Saharan Africa, which recorded annual growth of 6 percent in the five years preceding the crisis. In order to create new and better jobs, updating people’s skills is essential to improve their prospects. This is particularly relevant as developing and emerging countries face serious demographic challenges—from a record number of young job-seekers in Africa and the Middle East, to shrinking workforces in Eastern Europe and Central and East Asia.

An effective focus on workers—employing all of them, and employing them to their greatest productivity—is vital.

As a result, countries will need to have skill-building systems that guide youngsters through early childhood development, emphasizing nutrition, stimulation and basic cognitive skills; that ensure that once at school, all students learn as a result of clear standards, good teachers, sufficient resources and a solid emphasis on results and performance in the wider school system; that build the relevant skills that employers want through higher education and on-the-job training; and that encourage entrepreneurship and innovation.

Recovery will also depend on a private sector rebound. Businesses will invest and create jobs if they can turn a profit. Countries will need to create a more attractive investment climate by establishing clear rules, implementing regulatory reforms to make it easier to do business, and by making financing available to small and medium firms for private investment as well as to poor people themselves.

Countries also need to strive for better governance and against the rot of corruption. Governments, working with development partners, need to move quickly to create more opportunity. This includes expanding opportunities for girls and women as economies will not be successful if they discriminate against half their population.

As the development community takes stock of its MDG progress at the UN this week, we need to look beyond and behind the numbers to see what we can learn from them and our efforts to date. We need to invest in what works and fix what doesn’t. And as we do, we always need to keep in mind that this work is ultimately about empowering people. The human spirit can accomplish amazing things. We need to give everyone that opportunity.