How Development Hurts the World’s Poor | Foreign Affairs / Marc F. Bellemare |

Efforts by wealthy countries to help their poorer counterparts began in earnest after World War II with the Marshall Plan. By the early 1960s, Western powers were busy helping former colonies develop their agricultural and industrial sectors.

GIBS Information Centre / GIBSIC‘s insight:

Inclusive markets  – “A large part of the problem is structural. Bureaucrats in large development organizations, such as USAID, or the United Kingdom’s Department for International Development, face conflicting incentives, and although they are certainly rewarded for helping the poor, they are also rewarded for being entrepreneurial within their own organizations. The more pies they have their fingers in, the more sway they carry within their organizations, and few of their colleagues will stand in the way of someone wanting to do just one more thing for the poor. In nongovernmental organizations, there are also fundraising incentives at play. Seeing that there is money to be had from development agencies, an organization already focused on, say, environmental sustainability in the United States might start making the case that environmental sustainability is in fact a development issue. Enough issues have been brought under the development umbrella over time, with the result being widespread mission creep. “I can’t even have a road construction project without explicitly including a nutrition component,” a former student of mine who works for one of the world’s biggest aid organizations complained to me this summer. “ A nutritioncomponent — as part of a road construction project!”

See on www.foreignaffairs.com

Poverty escape plan revealed by computer model of economic vicious cycles

Poverty traps are insidious economic disasters that have terrifying consequences for individuals and indeed entire populations.

GIBS Information Centre / GIBSIC‘s insight:

Inclusive markets– 

How much cash does a country need to escape a poverty trap? Goerg and co say their model suggests that the money should be equivalent to halving the cost of disease treatment and prevention.

But this level of investment is not needed in the long term. Goerg and co say the same outcome can be guaranteed if the long term investment is equivalent to only 15 per cent of this cost.

See on medium.com

Want to Fight Poverty? Just Give the Poor Cash

A study suggests that the best way to fight global poverty is simply to give people cash and let them spend it however they want

GIBS Information Centre / GIBSIC‘s insight:

Inclusive markets–  “The research focused on households in rural western Kenya, where nearly two-thirds of people report not having enough food in their house for the next day. An average equivalent of $720 was given randomly to recipients through the mobile banking service M-Pesa.  –   Food consumption increased 20 percent, with a 42 percent reduction in the number of days children go without food. Recipients were also able to increase their ability to earn income. Revenue from raising livestock rose by 48 percent; total revenue from self-employment rose by 38 percent.”

See on www.businessweek.com

Africa Continues to Grow Strongly but Poverty and Inequality Remain Persistently High

Economic growth in Sub-Saharan Africa (SSA) remains strong with growth forecasted to be 4.9% in 2013.

GIBS Information Centre / GIBSIC‘s insight:

Growth, poverty, inequality – “Africa’s rising growth is underpinned by strong private investment. Gross fixed capital formation in the region has steadily increased from about 16.4% of GDP in 2000 to about 20.4% in 2011. The pickup in investment has directly contributed to economic growth and has also helped boost the productive capacity of the region’s economy.  –  Increasingly, infrastructure projects are being financed from new funding sources, such as China, but increasingly from Brazil and India, according to the analysis.


Translating growth into much less poverty

Despite strong growth, Africa’s progress on ensuring that growth translates into considerably less poverty has been slow and hindered by high inequality.”

See on www.worldbank.org

Brazil lifts 3.5mn out of poverty in 2012- Report | The BRICS Post

Rousseff had in February this year raised the monthly stipend of 2.5 million people living below the poverty line.

GIBS Information Centre / GIBSIC‘s insight:

IPEA report – ” . . .number of poor living on $1 or $2 per day, decreased from 19.1 million to 15.7 million, while the number of Brazilians living in extreme poverty went down from 7.6 million to 6.5 million.

The report also shows income gap narrowed in 2012, and the per capita income for households in the poorest 10 per cent of the population increased by 14 per cent.”

See on thebricspost.com