Although poverty remains widespread in south Asia and sub-Saharan Africa, substantial progress has been made especially in the past three decades. Nevertheless, this report stresses that climate change is likely to reduce agricultural productivity, which will directly affect poor people's livelihood assets including health, access to water and other natural resources, homes and infrastructure. Increasing climatic variability will make poor households even more vulnerable to extreme weather conditions, which could in turn exacerbate the incidence, severity and persistence of poverty in developing countries. The report surveys the research terrain concerning the effects of climate change on poverty looking closely at vulnerable rural populations in Indonesia and Mexico, where weather shocks have measurable short term, if not immediate, effects on rural livelihoods. The report highlights how the low-income farmers of Indonesia and Mexico are at the human forefront of climate change.