Helping the rural poor: the key to halving world poverty

The first Millennium Development Goal (MDG) aims to significantly bring down the levels of poverty in developing and transitional countries, over the next decade. But progress towards meeting this target has been slow and if it continues at a similar rate, we shall underachieve by 60 per cent. It is possible to turn this around but, only if donors and developing countries intensify efforts in combating rural poverty.

Research from the Poverty Research Unit at the University of Sussex examined how the target for halving world poverty was set and what progress has been made towards achieving it. The goal aims to bring down the proportion of the world’s population living on less than a dollar a day from 1990 levels of 29 per cent to 14.5 per cent by 2015. The researchers argue that suitable technology and a re-emphasis on employment intensive agriculture is the key to revive the faltering progress to the targeted goal.

The goal is a guiding principle for donors to give aid and for developing countries to implement programmes. The Poverty Reduction Strategy Papers (PRSPs) were the first step in achieving the target. In order to receive loans on low interest from the World Bank and IMF and debt relief under the Heavily Indebted Poor Countries (HIPC) initiative, each developing country has to produce a PRSP outlining its policies and plans for tackling poverty. The governments, in consultation with its people, produce this. International aid disbursements are dependent on the PRSP and have been directed to countries that have a well thought out strategy and are committed to implementing it.

Despite some progress, much has gone wrong because PRSPs have been tied in with debt relief process. The researchers show that:

• Countries like India and China - which have the largest number of poor people in the world and are not highly indebted - are not receiving adequate help with their anti-poverty programmes and this will adversely affect the global progress towards the poverty target.
• A narrow focus on macroeconomic policy - especially on liberalisation and economic growth - has meant that social sectors such as health and education have not received enough attention.
• There is insufficient focus on rural development even though 70 per cent of the world’s poor live in rural areas: this percentage is much higher in sub-Saharan Africa.
• Specific attention to production activities is lacking: prioritising government resources and improving private incentives to encourage employment or generate food for the poor have not been sufficiently considered.

The focus until 1990s was on increasing the production of staple foods. This changed to promoting the production of cash crops causing a sharp slowing down in the rate of poverty reduction. Notwithstanding this, the target of halving world poverty by 2015 can still be achieved, but only if policies are changed to take account of the following:

• Supporting agriculture, specifically the production of labour-intensive staple food crops by smallholders should be a priority.
• Improving public services such as education and health, as well as communication and transport infrastructure in the rural areas should be a key concern.
• Increasing access to physical assets such as farm technology, water and land: land reform could provide protection to those without assets.
• Complement existing efforts for improving agricultural production by improving irrigation facilities and agricultural research activities: technology should be favourable for providing employment to many people (i.e. be labour intensive) to have an impact on poverty.
• Developing better systems for collecting reliable information and data so that progress towards meeting the target can be more effectively monitored.

Source(s):
‘Halving World Poverty’ in Targeting Development: Critical Perspectives on the Millennium Development Goals by Richard Black and Howard White (eds.) London: Routledge by Michael Lipton with Hugh Waddington, 2004

id21 Research Highlight: 8 October 2004

Further Information:
Michael Lipton
Poverty Research Unit
University of Sussex
Brighton BN1 9SJ
England

Tel: +44 1273 678739
Contact the contributor: M.Lipton@sussex.ac.uk

University of Sussex, UK

Hugh Waddington
Operations Evaluation Department
World Bank
1818 H St NW
Washington DC 20433

Contact the contributor: hwaddington@worldbank.org

World Bank

Other related links:
'Is Asia losing the fight against hunger?'

'Missing the targets: poor progress on the MDGs'

'Rethinking rural development: what strategic changes are needed?'

'Rural development: what can the sustainable livelihoods route offer?'

'An enhanced strategy for reducing extreme poverty by the year 2015: interim report of the Millennium Project Task Force on Poverty and Economic Development' from ELDIS

'World Bank's new rural development strategy stresses participation and empowerment' from the World Bank

'Halving world poverty by 2015 economic growth, equity and security - Strategies for achieving the international development targets' from DfiD