The world’s next great leap forward: Towards the end of poverty

Hugh Evans presenting the Global Poverty Project (Photo credit: Wikipedia)

World map showing percent of population living on less than $1.25 (ppp) per day using the latest data from 2000-2006. (Photo credit: Wikipedia)

Poverty (Photo credit: Teo’s photo)

This is a brilliant MUST READ article published in the Economist. Check it out!

via The world’s next great leap forward: Towards the end of poverty | The Economist.

Let me try to distill a few threads from this article.

Firstly, it is reassuring to know that a billion people have been taken out of extreme poverty; poverty is defined as below $1.25 a day. Since the end of World War II, the World has mobilized enormous resources to tackle global poverty, with international agencies, donor countries and charities, all playing their part. However, on more detailed reading of the Economist article China has made the biggest contribution by switching her economy to the capitalist model. The challenge for reducing the next billion people from poverty is in Africa and India, where corruption is endemic; this is recognized as a harder challenge.

For me, there is an emerging question:

How should we ensure that aid for the poor is not squandered?

You are welcome to share your views.

Let me develop the thread a little sharing some of my own thoughts.

Personally, I am highly suspicious of very large charities. Too much money seems to disappear in “administration”. Even when the aid reaches the target country, a large percentage seems to be skimmed off by corrupt officials and criminal elements.

From my two years spent with UNESCO in Paris, I have a healthy respect for aid being channeled via UN agencies; however, aid needs to be channeled via special programs with strict rules as to expenses that can be offset against the aid.

Many advanced countries have bilateral donor programs where the granting of aid is tied to reciprocal preferential access to trade and mineral resources. This is part of geopolitics and business development but only has an indirect, diluted impact on poverty.

Given my political views, I still strongly favor globalization and liberalizing international trade; “open book” costing and accounting is required, with corruption treated as a pandemic. Imagine if the corruption was eliminated from Africa and India?

Rich countries need to look hard at their own waste and inefficiency. Yesterday, I re-blogged an excellent article in the UK’s Guardian highlighting that a half a million people in the UK were turning to food charity because the benefit system was failing them. I asked the open question: “With half a million UK people turning to food banks surely there is no justification for the UK Government to still ring-fence current levels of foreign aid?”. This generated some rich debate which I shall share as another blog.

Dwelling on rich country inefficiency, in my view, billions of dollars is wasted in ineffective procurement in the public sector (local and central government), plus international agencies, the EU and charities. In the case of Europe much of the problem emanates from bureaucracy at the center of the EU. Cutting the bureaucracies and deploying best practice procurement will save billions of dollars that can be applied more effectively towards economic growth and tackling poverty.

So once again, let me ask you to respond and share your views, responding to my open question: