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Why Did Some Countries Advance While Others Remained in Poverty? V

Which Countries Are Still Stuck in Poverty?

In our quest to understand sustainable development, and right now economic development we’ve focused on the modern era of economic growth We saw how the Industrial Revolution began in England and spread to all the world. Or, one should say, almost all the world because there are some places that still, even to this day, lack some of the basics, and lack some of the on-going economic growth that Indeed has reached almost all of the planet.

451We’ve been undertaking a differential diagnosis to understand how those, moving ripples of economic development have reached some places in the world, and failed to reach others. We’ve explored the role of the poverty trap. We’ve explored the role of geography. The role of culture. The role of, politics. Let’s put the pieces together. By focusing on those remaining areas in the world that are still stuck. Below the threshold of self sustaining growth. And, as we’ve used the idea of passing that threshold, looking at the $2,000 per person, per year threshold. As a marker for us. When we look at the map of global development. We see that those countries shown in red. On this map are the ones that, as of today, are still below that takeoff level. What do we see? We see that the remaining regions are, mainly, tropical Africa. And then, the number of land locked countries, Afganistan. Napal, Mongolia, Louse, and a few other parts of the world, and of course with out question we have to regard sub saharan Africa as the greatest challenge of development, the place in the world still with the highest poverty Rates, and with the biggest challenges in meeting basic needs.

452The good news is that in recent years especially since the year 2000, economic growth in sub Sahara Africa has picked up. There’s definitely progress, major advances in some of the key areas. Of disease control. Improved access to education, building infrastructre. But we’re still not yet in a sitatuion where there is self sustaining, rapid and dynamic growth, though one feels very much that it’s within reach. Let’s put our differential diagnosis. Perspective, therefore, on sub-Saharan Africa, and ask what we learn by taking that multidimensional view of a region to see what it implies for the priorities for economic and sustainable development. Africa has many distinct structural characteristics and many of these strustral charectarcistics are indeed sructeral problems for econmic development, if you look at the region of peverty in Africe That is below the Sahara Desert but above the southernmost countries. One is defining essentially the region of the tropics of Africa. Between the Tropic of Cancer at 23 Degrees north latitude in the tropic of Capricorn, and 23 degrees south latitude. And we know that the African tropics have many distinctive features that are relevant for economic development. Disease burden we’ve seen is very heavily concentrated in the tropic whether it’s malaria or other so-called vector-borne diseases, or worm infections that debilitate people, and that hold back whole societies. We’ve seen that.

453Agriculture can be very difficult in tropical conditions. Often water scarcity, with the very high temperatures, drought   propensity, soil nutrient depletion can be extremely pernicious in the tropical context. So this is one feature that needs to be addressed. Nothing impossible about these challenges because diseases like malaria are fully controllable, but they need to be controlled. We’ve seen that Africa has a distinctive feature of the most land-locked countries of any continent in the world. Roughly one in three African countries. Is land locked. 15 out of the 49 countries of Sub Saharan Africa. That’s a big problem. Why is that? Well, part of the reason is the colonial legacy. Remember that nature doesn’t draw national boundaries. Politicians do. And when the politicians divided up, Africa they divided it up into little parcels often cutting natural ecological areas dividing ethnic groups by artificial boundaries leaving a legacy. Of great difficulty making it hard for populations even to reach coasts. In many parts of Africa, the coastal physical environment is rather hostile. And in East Africa.

The eastern coast tends to be very dry. The trade winds come up to the coast from the east. They do not provide precipitation right on the coast, but as the highlands in the east coast carry those trade winds into higher altitudes, Then the rain is distributed in the interior, what’s called orographic rain fall, or rain fall that is caused by the uplift of the mountains, in this case, the highlands of East Africa. This means that the high population densities in East Africa are not at the cost but are in landlocked interior countries like Rwanda, for example, or Uganda. Where there is much more rainfall than one would find in their port of Mombasa, Kenya, which is in a, a much drier region. So, the distant from the ports has to do with history, it has to do with political boundaries It has to do, some historians think with the long legacy of even slave trade which caused populations in their self defense to move more into the interior. It has to do with the fact of rainfall being more propitious and able to support food production Often away from the coast and in the interior of the continent. We know that in many, many, other ways, the colonial legacy has played very difficult role. Have a look at the map of European colonial rule In Africa as of 1914. The first thing you see is the entire continent with the exception of of Ethiopia, was colonized. Africa was divided among the European powers, and the story of how it was divided is a rather shocking story. Actually, Africa was one of the last continents to succumb to European imperial rule. That may seem strange because Africa was very poor throughout history, therefore very vulnerable.

454As exemplified by the slave trade. So why wasn’t it colonized earlier? Europeans attempting to move to the interior of Africa in the earlier parts of the 19th century to colonize, succumbed to malaria and other tropical diseases, the disease burden actually prevented europe from colonizing africa until the latter part of the 19th century. Then what happened? Well, you could perhaps describe it to tonic water. Tonic water is water with quinine. But quinine is a natural preventative or curative to malaria, and when quinine was discovered and then mass-produced by the British and then by the other imperial powers, That enabled Europe to dominate Africa through military means. The Europeans were brutal vis a vis the Africans, but strangely polite and diplomatic among themselves. They sat down at the conference table at the famous Berlin Conference. Of 1884 and 1885 and said gentelemen, because of course was only gentelmen around the table, lets deivide africa in a very civilized way, civilized fro us without any civilaty vis a vis the fricans, and by 1914 you had a map of Africa that was divided in all of these arbitrary political divisions. This has left a legacy of wrong borders of high land lockedness of European domination over many of Africa’s natural resources. So that the resource earnings have been extracted and end up in tax havens around the world rather than the treasury coffers of Africa itself, the European powers did not provide education. Indeed there’s a documentary record showing we don’t want to educate the local population that would be a political Risk for us. And so when African governments achieved independence, often there were just a handful of people with a high school, much less a university, education. The infrastructure, physically, that the European powers left behind was also strangely deficient.

455Have a look at, a comparison of the map of the Indian railway system, built largely during the British colonial period in India, with the map of Africa’s railway system built largely during the period of colonial rule. In India you see a full grid. And that was because a unified colonial power, Great Britain, created a unified infrastructure, partly to extract India’s natural resources, including its cotton. As inputs to the cotton mills of England. In Africa, where the conditions were harsher and more difficult and the political divisions existed, the European colonial powers did not sit down together after the conference in Berlin and say, Now let’s construct a railway network. They each one constructed just a line from their port to the diamond mine or to the gold mine or to the plantation, and so the rail systems in Africa is not a full grid, but is just spurs that go to a few locations. And this has much greater burden for Africa. When India had its agricultural revolutions, so-called Green Revolution of the 1960s, this railway line played a crucial role in bringing fertilizer into the interior and bringing grain from the interior to the national economy. But in Africa, the rail can’t sere that purpose it doesn’t exist. It still has to be built. Even in the 21st century. So the legacies of colonial rule in Africa have been very, very tough. This isn’t an explanation of everything My point, again and again, is, don’t take a single factor. You cannot blame it just on colonial rule. We’ve seen, you can’t blame it just on, quote, corruption, because in many parts of Africa, the levels of corruption are comparable to far richer countries. In other parts of the world. You can’t blame it just on culture, though culture matters. It matters for gender, it matters for fertility. It matters for commitment to education. You can’t blame it just on geography, but geography surely has player a role in the burden of disease, in the vulnerabilities of agriculture. Of the high transport costs. Differential diagnosis doesn’t necessarily give you a simple answer. Simple answers are often highly simplistic answers. We need accurate answers, and the differential diagnosis helps with accuracy. It identifies several of the challenges that need to be addressed, even though Africa And, other countries still stuck in poverty. May face added burdens. They also have the opportunities for technological breakthroughs. Unimaginable, until recently. Now, when you go, even to the remote African villages across the continent. Maybe with few exceptions, but as a general rule, mobile phone coverage is there, broadband is on the way, information technology, is already transforming these very low income villages very low income regions Bringing in knowledge, market information, data empowerment and the potential for breakthroughs in help, in education, in business development. In other words, when we make the differential diagnosis, we identified the political and the cultural and the geographic. Phenomenon when we identified that heritages of the colonial period and the shortfalls of the infastructure. We are not overcome by pessimism but we are motivated with an agenda. An agenda which is targeted. A specific, a balance of public and private investment At areas for social mobilization, public awareness, the role of parents to help their children to make breakthroughs as well, that is the key for sustainable development.

The MDGs and the end of extreme poverty I

The reasons to believe that extreme poverty can be ended

We’ve studied the process of modern economic growth and we’ve seen how economic progress has diffused throughout the world[1]. We’ve adopted the method of differential diagnosis so that we can help regions that are still stuck in low growth or even in a poverty trap to overcome that trap through a careful, evidence based diagnosis of the problems. Therefore, we’ve arrived at a very exciting moment.

511The world is poised, for the first time in human history, to end the scourge of extreme poverty. It may seem fanciful to many people and may seem Utopian, but it’s real. The rate of extreme poverty has been falling. The evidence is clear, it can continue to fall, can decline sufficiently rapidly that this generation could be the generation that sees the end of extreme poverty. Now, what the differential diagnosis tells us is that it won’t happen by itself. It’s not automatic, but the end of poverty is within reach. Just take a look at the numbers. Back in 1980, the World Bank estimates that a little bit more than half of the world’s population in developing countries, perhaps 55 to 60%, were in extreme poverty using the World Bank’s criterion of living at less than $1.25 per person per day, measured in purchasing power adjusted prices. By 1990 that poverty rate had come down to around 44 or 45%.

But since 1990, the progress has been specatcular. From 1990 to 2010, the poverty rate in the developing world fell by more than half. From around 44% to around 20% in the year 2010. And it continues to decline now. This is the reason why finance ministers and development leaders gathered at the World Bank in the year 2013, voted to make the World Bank’s target and mission, to be supportive of the end of extreme poverty by the year 2030. In other words, our generation could be the one to see end of extreme poverty. It’s our job, of course, to understand how this could happen and then to act to make it happen. Before we get to the strategy up to 2030, let me turn back the clock to 1930. It was the depths of the Great Depression, there was a lot of poverty in today’s high income world as well as in the poor countries, the developing world. John Maynard Keynes, that great political economist of the 20th century, wrote a wonderful essay, Economic Possibilities for our Grandchildren. That’s the one where Keynes noted that from the time of the Roman Empire, up until the 18th century, the rate of technological progress had been extraordinarily low, so low in fact, that a peasant from the Roman Empire would have felt at home in rural England in the early years of the 1700s. But Keynes went on in that essay to note the explosion of technology of the Industrial Revolution, and he drew, in 1930, in the depths of the Great Depression, a startling lesson from that technological progress. Because you could imagine in the Great Depression, with mass unemployment, and with the pessimism around, that one could have been overwhelmed feeling that economic progress was at an end. But Keynes said no, let’s look more deeply. Technological change means that even though we have a serious short-run crisis, the long-run is promising. Let me quote what John Maynard Keynes wrote in 1930. And I quote. I would predict that the standard of life in progressive countries 100 years hence will be between four and eight times as high as it is today. There would be nothing surprising in this, even in the light of our present knowledge. It would not be foolish to contemplate the possibility of a far greater progress still. I draw the conclusion, says Keynes, that assuming no important wars and no important increase of population, the economic problem, by that, he means the problem of poverty, may be solved, or be at least within sight of solution, within a 100 years.

This means that the economic problem is not, if we look into the future, the permanent problem of the human race. It’s interesting, 1930, John Maynard Keynes says the economic problem meaning the persistence of poverty, could be a thing of the past within one century and it’s exactly at that century mark that the World Bank now contemplates the realistic end of extreme poverty. A pretty good call. Now, John Maynard Keynes said that he could foresee this if there was no significant increase of population. Of course there has been, because when he wrote in 1930, the world population was 2 billion. Now it’s 7.2 billion, more than three times as large, and by the middle of this century it will be more than 9 billion, most likely. He also said that barring world war. But of course, there was another major war, the Second World War. And despite both of those facts, the massive increase of world population and the continuing tragedies and destruction of war. Keynes’ basic insight, that technological progress can bring about the end of poverty, remains true, and it remains prescient, because we are at the cusp of that final push to end extreme poverty, if we decide to make it happen.

512Now in the year 2000, a remarkable thing did happen. 160 plus leaders of the world gathered together in September 2000, at the United Nations, to usher in the new millennium. And when they did so, they wanted to convey the hope of the new millennium. So the Secretary General of the United Nations, at that time, Kofi Annan, put forward to the world leaders, a millennium declaration. That called for the new millennium to realize the great hopes for human rights, for peace and security, and for economic development and the reduction of extreme poverty that humanity yearns for. The world leaders adopted the Millennium Declaration and within it adopted specific development goals, which have become known as the Millennium Development Goals.  Eight ambitious goals to fight extreme poverty adopted in September 2000 and to carry us to the end of 2015. And you are looking now at the schematic of these eight Millennium Development Goals, drawn as a cartoon for each goal, but that by itself is a telling point because these goals are not for high theorists they’re not for the textbooks, they’re for all of us.

They’re for humanity to grasp. To promote, to urge our governments to take seriously, and for us to take seriously in our individual actions, in our roles in business, or academia, or in our places of worship, or workplaces so that we can each contribute to the end of extreme poverty. Have a look at the eight goals. Goal number 1 calls for eradicating extreme poverty and hunger. Goal number 2 is to achieve universal primary education. Goal number 3 is to promote gender equality. So that women, like men, have rights and, and access for economic progress. So that girls as well as boys go to school and get a decent education. Goal number 4 is to reduce sharply child mortality. Goal number 5 is to reduce sharply maternal mortality and ensure safe and healthy pregnancy for mothers and for their children. Goal number 6 was to fight the raging pandemic diseases of AIDS, TB, Malaria and other mass killers. Goal number 7 is to promote environmental sustainability. And goal number 8 is to promote a global partnership, where by the rich countries help the poor countries to achieve the first seven goals.

513Now in fact, beneath this general description, are some specific quantitative targets and many dozen indicators. For the eight Millennium Development Goals, there are 21 targets, specific and quantified, and there are around 60 detailed indicators to measure the progress. It’s been my honor and pleasure to serve as Special Adviser, first to U.N. Secretary General Kofi Annan, and now to U.N. Secretary General Ban Ki-moon on the Millennium Development Goals. And to help analyze and to help coordinate the UN’s efforts to enable and support poor countries to achieve all of these Millennium Development Goals. It’s been a wondrous process to see how this kind of goal setting can energize civil society.

Can help to reorient governments that may have been neglecting crucial issues of disease control or the safety of childbirth or ensuring that all children go to school. And to reorient priorities, political awareness, budgets to achieve these goals. But progress has been notable, and breakthroughs have occurred for some of the world’s poorest countries. Have a look at the overall trend of extreme poverty, as measured by the World Bank at the $1.25 per person per day threshold. And what you see here is that sharp decline, which I mentioned just previously. That from a poverty rate of around 44% in 1990, the poverty rate has come down to around 20% in 2010 and it continues downward today. The millennium development goals by themselves certainly did not accomplish all of that reduction of poverty.

514There was a powerful trend underway. China’s remarkable economic growth is a big part of the story. But we’ve seen parts of the world and notably tropical sub Saharan Africa achieve a real breakthrough in faster economic growth and therefore in the reduction of poverty after the year 2000 spurred on by the millennium Development Goals. Here you’re looking at the rapid increase of the number of people kept alive by antiretroviral medicines when they are infected with the HIV virus. Now the HIV virus, if not stopped in its tracks by antiretroviral medicines, causes AIDS. And causes a near certain death. But because of the Millennium Development Goals and programs that it has helped to spur, millions and millions of people now receive life-saving antiretroviral medicines. The reduction of malaria burden that has been achieved by the scaling up of focus and attention and budgets to fight malaria through the range of modern technologies. Long lasting insecticide treated bed nets, a new generation of anti malaria medicines and many other advances that have been enabled through better technologies during the last decade. And this is causing a remarkable decline of malaria deaths and malaria disease, especially in Sub-Saharan Africa since the peak was reached in the early 2000s. Well, we can see that the combination of continued rapid technological change, and a good differential diagnosis that helps us to focus investments where the poorest places need it. Whether it’s in infrastructure or healthcare, or getting children in school or safe drinking water and sanitation, gives us a very powerful combination to not only witness the underlying forces of poverty reduction, but to help spur them on so that we can be the generation that brings an end to that long standing human scourge of extreme poverty. The Millennium Development Goals have given us a big push up to the year 2015 and one more major effort form 2015 to 2030 will vindicate John Maynard Keynes’s forecast. A 100 years before that. That the economic problem of extreme poverty can come to an end.




Economic Development – How We Measure It, How It Varies Around the World I

Incomes Around the World

Sustainable development we’ve seen has three major aspects, economic development, broad-based inclusion and environmental sustainability, all supported by good governance. But what do we mean by economic development?

I want to introduce the main concept of how we measure economic development. Of course, there are many different aspects of a true and proper understanding of economic development, but we tend to use a short hand, and that is called the gross domestic product of a country. The gross domestic product has three words and three concepts in it. It means the total production taking place within the geographic boundaries of a country in a given year, so the gross of the gross domestic product means you’re measuring everything that is taking place within the country. You’re not taking into account in that measurement the depreciation of capital and so forth which would give us a different concept called net domestic product. Domestic signifies the fact that we’re talking about a geographic area, and we’re concerned with how much economic activity or production takes place within the boundaries. Of course, usually we’re talking about a country, but we could be talking about the production of a city or a region. And sometimes of course, we also want to talk about the gross world product which is adding up the domestic production across all of the countries of the world.

And product, or production, signifies the fact that what we’re interested in measuring is not the accumulated wealth, the wonderful buildings and monuments and roads and infrastructure, the natural beauty, of a country, which may tremendously raise the quality of life. We’re interested in the actual flow of production in a given time period. Now, for most purposes we look at a year, though when policy makers are trying to understand short term dynamics of unemployment and production, they’re interested often in measuring the gross domestic product even over a quarter of a year. We’re going to look at national measurement or countries. We are going to look at the annual measurement.

Now, one more critical point about measuring the gross domestic product. In general, we are interested in getting a sense of the standard of living of a country, and to do that we take the total production in the country over a given time period, usually the year, and divide it by the population so that we’re interested in the gross domestic product per person, or per capita.



Why is that? Well, of course, larger countries produce more because there are more people. There are more workers, but if we simply were to compare countries in terms of the total production, we’d find that highly populous countries would have higher production but we wouldn’t learn very much about whether the living standards of those larger countries is really higher than the living standards of a small country, which may produce a little bit but quite a bit for each person in the economy.

So when we think about economic development, we tend to think about the gross domestic product per person. Let me emphasize again. That’s not really a comprehensive measure of economic development. We want to know whether people are healthy or not. We want to know levels of education.

We want to know other indicators of well-being, but as a shorthand, when I want to get a sense of a country’s overall level of economic development, I start by looking at the gross domestic product per person because it’s going to be a pretty good indicator of where things stand. And indeed that’s what the keeper of the accounts, which is the World Bank, does.



The World Bank keeps very systematic tabulations on gross domestic product per person, and it classifies countries in a way that is also extremely helpful for us. The World Bank gives three categories of countries, high income countries, middle income countries and low income countries, and it puts each nation into one of those three bins, depending on its measured gross domestic product per person.

Roughly speaking, a low income country is a country where the domestic production per person is at a level below a threshold of about $1,000 per person per year. In other words, roughly $3 per day, and a middle income country is a country that is in a band between $1,000 roughly per person and about $12,000 per person per year. And the high income countries are countries that are above the $12,000 per person threshold. There are then refinements. The middle income group which is quite a big one, is divided between the upper middle income and the lower middle income, with the dividing line of about $4,000 per person per year.

The World Bank categories provide us with a, a useful depiction, a, a good map of the world, and if you look at the map in front of you, you can see that those few areas that are shaded blue are the high income countries, the US and Canada, Western Europe, Japan and Korea, Australia, and New Zealand, and a few other parts of the world. Add up the population of that high income group, and you find that it’s about 1 billion of the roughly 7 billion people on the planet.


So it’s about 1 in 7 in the world, roughly 15% of the world’s population living in high income countries. Then take a look at this large middle group of beige colors, and you see that that covers a wide expanse of the world. And indeed 5 out of 7 in the world’s population, roughly 5 billion of the 7 billion people on the planet, are in the middle income category. So that’s a big middle, and that’s divided between an upper part and a lower part, roughly half and half. Approximately 2.5 billion people in the upper middle income category and about 2.5 billion in the lower middle income.

Then look at the countries shaded red. Those are the poor countries, the low income category, and by simple arithmetic, we can say that 7 billion minus the one in the high income, minus the five in the middle income. That leaves about 1 billion people approximately living in the low income countries.


We’ve already noted that the low income countries are heavily concentrated in tropical Africa and in South Asia, with this scattering of low income countries in other parts of the world, but in our world today, the poorest countries in the world are concentrated in these two regions, and most of the world’s poor people therefore live in those regions where the countries are in the low income category.

Now, let me mention one more category. It’s not a World Bank category. It’s a United Nations category but also very important for us to remember. Even within the low income countries, there are distinctions. There’s a subgroup within the low income countries that’s in pretty desperate shape.

Not only are they poor, but the human conditions of disease, of education levels, of social instability, are very bad. And moreover this subset of countries is highly vulnerable to droughts, to floods, to conflict, to, to violence. So these are a group of highly vulnerable, very poor countries, and the UN has classified them as the least developed countries. There are about 50. Right now the list is 48 but it goes up and down depending on how countries are performing. Among the least developed countries, the poorest of those are again heavily concentrated. You see that in tropical Africa there’s a large number of least developed countries.


There are several in Asia, and if you look closely at the map, you’ll notice something very telling for us. Afghanistan, Nepal, Bhutan, Laos, landlocked countries. This is not by accident. We’re going to see that economic development depends on international trade. Being landlocked is a problem. You’ll also notice a number of small island economies in the Pacific, and also Haiti. Small island economies also can be quite vulnerable and part of the least developed countries.

We know what these categories look like. Intuitively it’s good to remember London and my own hometown New York City among the high income countries. Middle income countries,  io or San Paulo in Brazil, where you have a tremendous amount of development and wealth, but you also have the foreign, the slums. Countries that are in the middle of the pack often doing very well in raising income levels. China, another major world economy that is a middle income country.

The poor countries, we know what they look like also because they’re more rural. Small holder farmers. Peasant farmers scratching out a living and hardly making ends meet. And for the least developed countries, Somalia, unfortunately in its tragedy in recent decades really a clear example of what it means to be among the poorest of the poor and not only desperate poverty, hunger, lack of education, low life expectancy, but lots of violence and lots of political instability as well. Let me mention one more important detail for us in terms of measurement.

For everything that I’ve said so far in measuring the gross domestic product, the total production is added up and divided by population to get the gross domestic product per person, and since countries have their own currencies, they have to be converted to a common standard. And so the exchange rate is used to convert the national currency into a common, typically U.S. dollar standard, and that’s how we make the comparisons in a common currency.

But there’s another translation that can also be useful. I want you to be aware of it because we will be referring to it many times, and that is to make one more adjustment for the difference of costs or prices in different countries. If you buy an automobile or a television set almost anywhere in the world, price will be fairly similar because these are goods that are traded internationally, and they have a similar price when expressed in dollars in any part of the world.

But if you go to rent an apartment or get a haircut or go to a movie or park a vehicle in the center of town, you’ll find the difference in costs extraordinary. In London or in New York or Tokyo or Paris, the prices would be sky high, but in a poor setting in Mogadishu or in Akrah or in, Bamako, Mali, the price of a haircut might be a 20th or a 50th what you’d, pay in a salon in Paris. So one has to take into account that simply measuring the output and converting to dollars might not give a full comparison because the purchasing power in a poor country might be a little bit higher than is indicated, so we often make one more adjustment called purchasing power adjustment, or purchasing power parity to take into account the relative price levels.

When you do that you find that poor countries are still quite poor, but they’re not quite as poor as they look. Take a case of a country like Malawi, a poor country landlocked in tropical Africa. Measured in the market prices and market exchange rate, its per capita income is around $250 per person per year compared with $50,000 per person per year in the United States. Malawi’s extraordinarily poor. Adjust for the lower costs of living in Malawi, and you find that Malawi’s still very poor, but maybe the income with the purchasing power adjustment should be around $900 to $1,000, roughly 4 times higher than simply using the market prices. So thats a system called purchasing power parity, measures of gross domestic product per person.

It’s a lot of words. It’s a lot of concepts. The main point that I am stressing is that we measure economic development in short hand by the gross domestic product per person. We adjust obviously for population. We adjust for currency, and very often we want to adjust for the different price levels. Then, we can classify countries, and we can study the question, why are countries at different levels of development? How do those different levels of development relate to other things that matter a lot for people, their health, their well-being, their happiness, and what can countries do that are at the low end of this curve, the least developed countries and the low income countries, to raise their living standard to achieve economic growth, that is a rise of gross domestic product per person? Fast enough to narrow the gap significantly with the wealthier and the higher income countries. That of course is one of the key challenges of sustainable development.

What is Sustainable Development? III

Continuing Poverty

In many ways we live in a world of plenty. Economic growth has produced incredible wealth. Many parts of the world have escaped from economic hardship. Countries like China, which were once very poor, are now solid middle income countries. But sustainable development calls for prosperity that is broad based. And, despite living in a world of plenty, there are still large numbers of people, more than a billion, more than one out of every seven persons on the planet, living in extreme poverty. What is the face of extreme poverty? 131If you look at a small farmer At this peasant living in Northern Ethiopia. There’s no modern transport around you don’t see electricity grids in the distance. You see a pretty parched environment. That’s not a complete coincidence. A dry land area. Of, poor farmers, eking out a living, trying to ensure enough annual food production to feed themselves their families. Maybe to get that surplus to bring to market for a little bit of cash income. Another part of poverty?

Have a look at a street in a slum of Nairobi. Millions of people live in the slums of African cities like Nairobi hundreds of millions of people live in urban slums around the world. This is another face of poverty. While it remains true to this day that more than half of the world’s population living in extreme poverty lived in rural areas, of course, the urban poverty is known to us.132

Often the urban poverty is living right next to a great urban wealth, and what do we see in this street in Nairobi. You see an unpaved, muddy road. People living without modern power, probably without any modern sewerage or sanitation. In other words, even though these are people living in an urban area of several million people, they’re also like that peasant in Northern Ethiopia, unable to secure basic needs. Access to emergency healthcare. Access to basic clean power in the form of electricity or natural gas for cooking. Lack of access to safe drinking water and sanitation, and barely eking out a monetary living that can meet even the most basic of minimum needs of clothing and safe shelter.

When we speak about poverty, therefore, we’re necessarily speaking about a many dimensional concept. Poverty is usually viewed as lack of adequate income, but I want us to think about it as a lack of income, a lack of access to basic health services. A lack of access to basic amenities that most of the world takes for granted. Safe water, sanitation, electricity, access for children to, a decent education. People living in extreme poverty are people who cannot meet these basic needs. And while proportions of the world living in extreme poverty have been shrinking markedly in recent decades, the numbers are still staggering.133

Depending on one’s estimate and one’s exact categorization of extreme poverty, it’s fair to say, that between one and two billion people in the world are struggling to meet basic needs. And probably fair to say, that around one billion people struggle for daily survival. Will they have enough to eat? Will polluted water cause a disease that threatens their lives? Will a mosquito bite carrying malaria carry away their child because they can’t get access to the $0.80 dose of medicine needed to cure the disease.

That’s the struggle of daily survival for people living in extreme poverty. Where is this poverty? Well, one place to look is the average incomes in different parts of the world. Take the national production of the economy, divided by the population so that one gets the amount of income generated per person, per year, in different countries of the world. And if you put them in a color code as you see here. You can see a huge variation in income levels around the world. Those dark blue areas, there aren’t too many of them. Canada, and the United States. Western Europe. Australia and New Zealand. Japan and South Korea. Those are the high income parts of the world. And by and large, extreme poverty has been eliminated from those countries. But take the bright red or beige parts of the world. There you’ll see the greatest poverty.

And what you can see very, very clearly in this world map, is that extreme poverty today is concentrated mainly in two regions of the world.

134The first is in tropical Africa. That’s the part of Africa in between the northern African countries and the countries at the very south of Africa, and you see on average, a lot of poverty within those countries. Often half or so of the population, living in extreme poverty. And the other concentrated part of poverty in the world is in south Asia. India, Pakistan, Nepal, and Bangladesh, nearby countries that are sometimes experiencing economic growth but still with vast numbers of people, often in rural villages, living without security of their basic needs.

Thank goodness, in both Africa. And in South Asia. The proportions of households living in extreme poverty are coming down. Thank goodness for the world as a whole, the numbers have been coming down. But clearly, we still have a very serious challenge, a moral challenge and a practical challenge people living in extreme poverty, face risks of survival. Often countries where poverty rates are very high, succumb to violence, to terrorism, to epidemic diseases, to mass migrations, to environmental disasters, that not only are tragedies for them, but can trigger unrest and instability among their neighbors and in other parts of the world as well.

We see in the next map another aspect of extreme poverty. People living in extreme poverty face a burden of disease and shorter lives as a consequence.135

That make their lives distinctly more difficult, often more painful and tragic than lives of people in other parts of the world. Once again, where is the concentration shown in this map of high mortality rates of young children? In this particular map. What’s shown is the mortality of children under the age of five.

136For every 1,000 births, how many children   won’t survive til their fifth birthday? What’s called the under five mortality rate. Once again we see that Africa is really the epicenter and tropical Africa is where the highest burdens of disease still reside. It’s a stark fact that even in countries where there’s a tremendous amount of economic progress, there can still be very significant pockets of poverty that are unrelieved.

A lot of inequality, lack of social inclusion, and major gaps between rich and poor. And sometimes the starkness of that is right in front of our eyes as in the view of Rio de Janeiro that you’re looking at right now, where in the foreground, you see the low lying favelas, the slum areas of Rio. 137And in the background, of course, you see the, high rises, the, the modern, very high quality of life, of, the wealthier people of Rio de Janeiro. While there are some parts of the world where most of the population is poor. There are a number of countries that have reached what we call the middle income status. Countries like Brazil where there still are important pockets of poverty that need to be releived. As always with sustainable development, there’s hope.

There are things that can be done to help people meet their basic needs, to help them overcome that daily struggle for survival. One of those opportunities that I find most exciting is shown here in this picture of this valiant young woman a community health worker. Working, with her backpack of medical supplies, to make sure that if an illness does strike one of those very poor, small holder farmers, one of their children, that there’s a cure, a remedy on the way.And through that we can extend the benefits of modern health and medical sciences to reach everyone in the world. Well, we’ve already noticed that the 138degree of poverty has a kind of geography to it.

On this fascinating depiction of income on our globe, shown not as a maps, but as a globe where the height of each point on the globe measures the economic output of that point. You can see those startlingly high levels of GNP on the islands of Japan. You can see that in the east coast of Australia the very high levels of development shown by the markers, but you can also see the low lying areas in England, China, in India. And the point that I want to emphasize in looking at this alternative depiction, of the world economy, is that geography of wealth and poverty is complex. Not 139only broad regions. Say, Europe versus Africa. Or Japan versus India, show stark differences. But even regions within countries, the coastal areas versus the interior of countries show very, very big differences. When we analyze in depth the nature of extreme poverty, the causes of why it continues to this day even in a world of plenty.

We’ll spend a lot of time looking at some of these geographic features. Is the county, or the, city on a coast where trade is easy?  Is it in the interior where it might be more economically isolated? Is it in a good climate zone where food production is easy? Or it is, is it in a dry land region as we saw in Karo, Ethiopia where food production is a lot more difficult because of the low level and the instability of rainfall. Is it a healthy climate, where, disease burdens are naturally low? Or is it a place where killer diseases like malaria are more easily transmitted? Geography still today plays a big role in shaping wealth and poverty. By understanding the role of geography, we’ll make a big advance, not only in understanding why extreme poverty continues in a world of plenty, but what we can do about it.