PRESS BRIEFING BY DIRECTOR OF UNDP SOCIAL DEVELOPMENT AND POVERTY ELIMINATION UNIT

Press Briefing

PRESS BRIEFING BY DIRECTOR OF UNDP SOCIAL DEVELOPMENT AND POVERTY ELIMINATION UNIT

The deepening economic crisis and poor prospects for world growth were a severe setback for poverty reduction efforts, according to a United Nations Development Programme (UNDP) report, entitled Overcoming Human Poverty, which was released today.

Speaking at a Headquarters press briefing, the Director of the UNDP Social Development and Poverty Elimination Unit, Thierry Lemaresquier, described the report as a global overview and a score card of country efforts since the 1995 World Summit for Social Development in Copenhagen. A central message was that poverty reduction could not be an afterthought in economic planning, but must be at the core of macroeconomic policy.

A number of countries faced the prospect of a second lost decade for poverty eradication, he said. The situation was a double tragedy, first because there was a danger recent positive trends would be reversed. Many countries -- especially in South Asia -- with some of the best poverty reduction track records were in danger of losing ground. This year in Indonesia, 40 to 60 million people would fall below the poverty line -- an increase of nearly 40 per cent, from around 11 per cent in mid-1997. Some estimates indicated that, by year end, up to 500 million new people around the world would join the 1.3 billion already living in absolute poverty.

The situation was also tragic because such setbacks were preventable, he continued. Stronger action was needed to protect poor people from the onslaught of recession and to mobilize their energies, efforts and creativity for recovery. The poor were not speculating against the currencies of their countries, nor were they adding to the volatility of international capital. Yet, they were the first to be deprived of public support for education, health care and other areas vital to their livelihood.

The current situation was developing at a time when official development assistance had fallen to an all-time low, he said. In 1998, it would be a mere 0.22 per cent of the gross domestic product of industrial countries. That raised the question of where the support would come from, given the large levels of poverty being generated. It was as if there was a collective default by the international community on commitments -- particularly those made to eradicate absolute poverty -- made at the Copenhagen Summit.

The report examined the relationship between globalization and its winners and losers, the effects of the Asian financial crisis on poverty and some aspects of poor-risk country debt, he said. It also included the results of research into the relationship between economic growth, inequality and

UNDP Briefing - 2 - 16 October 1998

poverty. Out of 38 countries with moderate growth over the last decade, just as many had an increase in poverty levels as those that combined economic growth with poverty reduction.

The good news against the bleak background was that countries were making efforts to reduce poverty, he said. They realized that poverty reduction mattered and extreme poverty was politically, economically and socially unsustainable. The UNDP global survey of 130 countries had found that 80 per cent monitored poverty and had fairly recent estimates. More countries were using definitions of poverty that went beyond income levels and took the human dimension into account. About 60 per cent of developing countries had formulated policies and strategies to fight poverty. Only about 30 per cent had set national targets, and few had systems to monitor progress in meeting goals.

He said the donor group of the Development Assistance Committee of the Organization for Economic Cooperation and Development (OECD) had set a goal of halving the proportion of people living in extreme poverty by the year 2015. There was a greater convergence of policy objectives between what had been adopted by the United Nations system, what the donors were looking at and what countries were trying to do. That made the reversal of progress even more tragic, he added.

He said the report's findings were already being used at the country level as another asset to improve policy dialogue with governments, civil society, non-governmental organizations, the media, academia and the private sector. The report was also part of the effort to improve UNDP accountability and give the public a comprehensive picture of its efforts to reduce extreme poverty.

A correspondent said the report did not address a key issue -- the plundering of national resources by leaders in developing nations. Was the failure to deal with that question due to political sensitivities? he asked. Mr. Lemaresquier said the question was a sensitive one. However, the report was the first of its kind, and it therefore focused on establishing a base line and not on the political economies of poverty.

The country examples in the report provided sufficient text to prompt questions about why one country was doing better than another, when both began at the same starting gate, he continued. In a number of countries, until very recently, talking about poverty reduction had been seen as an insult to national dignity. However, the statistics showed that more countries were coming to terms with the need to address the problem. The next report could much more squarely address the political economies of poverty and inequality.

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