United
Nations Development Programme
Presentation
to The Humphrey Alumni Association
In
Celebration of the 20th Anniversary
Of
the Hubert H. Humphrey Programme
Poverty Eradication and Development
Into the 21" Century
Gillian
Lindsay-Nanton
Resident
Representative
United
Nations Development Programme
Jamaica
Terra
Nova Hotel
Kingston, Jamaica
7 June 1999
INTRODUCTION
I propose to address the topic, Poverty Eradication and Development into the
21st Century broadly.
Next I will give some indications of the poverty situation in Jamaica,
and conclude by highlighting several programmes that are being undertaken by
the donor/lender community to meet this challenge.
Poverty eradication has now become an
over-riding focus of international action among most donors and lenders,
including the work of the United Nations System. The first six world conferences held in the early 1990’s which
addressed global problems relating to the environment, social development,
women, habitat and food all sought to emphasize the urgency of eradicating
poverty. This focus was sharpened when
almost all countries the world over committed themselves at the World Summit
for Social Development in 1995, to the attainment of eradicating severe poverty
in the first decades of the 21st century.
Given
the progress made in reducing poverty in the 20th
Century, the international development target agreed to by
the United Nations of reducing by one-half the proportion of people living in
extreme poverty by the year 2015, is not an impossible one. Despite the progress made in dramatically
reducing poverty in many parts of the world, around 1.3 billion people-nearly a
quarter of the world's population live in extreme poverty.
POVERTY FROM A HUMAN DEVELOPMENT PERSPECTIVE
It
is perhaps true to say that the development community by and large, seems now
to accept a new development paradigm- one that places people and societies at
the center of the policy-making process, although it can be argued that the
liberalization "free market" approach when strictly applied, does
undermine this paradigm.
UNDP, with its first publication of
the Human Development Report in 1990, has done much to advance an approach to development that focuses on people,
both as participants or agents and beneficiaries of change of the development
process. This approach focuses on
sustainable human development, including the linkages between economic, social,
political, cultural and environmental concerns.
It
follows that human development is the process of enlarging people's
choices. The most important choices and
perhaps most basic are to lead a long and healthy life, to acquire knowledge
and opportunity and to have access to resources needed for a decent standard of
living. There are other choices that
are valued by individuals such as political freedom and other human rights,
opportunities for being creative and productive and enjoying self-respect.
If it is accepted that human development is about enlarging choices, then poverty means that opportunities and choices most basic to human development are denied.
Poverty within a human development framework is no longer only about malnutrition, homelessness and income poverty. It is also equally about the absence of some basic capabilities to function, and which might range from inadequate shelter, clothes, and food to more complex social achievements such as being unable to partake in the life of the community. UNDP defines this as the capability perspective of poverty.
In
line with the above conceptual framework, in 1997 UNDP introduced the human
poverty index (HPI) which combines several dimensions of poverty, analyzing it
from the perspective of differing types of deprivations that characterize
it. Hence, indicators of deprivation
such as, a short life, lack of basic education and lack of access to public and
private resources are employed. But a
word of caution, the HPI has weaknesses, as it cannot capture the totality of
human poverty. Nonetheless, it makes a
useful addition to the measures of poverty and certainly attempts to
counterbalance, if not substitute, the conventional notion of poverty as only
income poverty.
As suggested earlier, while significant progress has been made in the 20th Century in reducing poverty, this progress must be put in perspective. Progress in reducing poverty has not been equally distributed, with some regions too often lagging behind others, for example, Sub-Saharan Africa. Much human deprivation still remains in the developing world with nearly a third of the 1.3 billion world's poor living on less than $1 a day. Furthermore, more than 840 million adults are still illiterate and about 800 million people lack access to health services. Children and women suffer the most. In the developing world, nearly 160 million children under age five are malnourished, and more than 110 million children are out of school.
At 538 million, women constitute nearly two-thirds of the adult illiterates in developing countries.
In the English-speaking Caribbean, since the late 1970s and
early 1980s for several of these countries there has been a decline in general living standards accompanied by
decreasing economic growth rates.
We know that their heavy debt burdens constitute a major obstacle to
economic growth and development.
The declining growth rates have helped to create a widening of the gap between the rich and the poor in most countries of the region. This has led to an increase in the incidence of poverty. Countries are registering significant poverty levels, accompanied by high rates of unemployment and underemployment among the youth. Caribbean economies are also plagued by increases in drug abuse and violent crime, in part related to the rising incidence of poverty.
For Caribbean economies, all this must be placed in the context of the fragility of their small economics-a fragility which is derived from several factors including the small size of the domestic markets which results in the high degree of openness and the need to trade; the vulnerability to external economic events and to natural disasters; the high per capita costs of providing government services and physical infrastructure; the narrow resource base which leads to specialization in few products; and the dependence on a few markets and on preferential trading agreements for major agricultural exports.
But what are some of the challenges to poverty eradication in the 21st Century?
There are many challenges today which make the eradication of poverty an even more formidable undertaking. I refer particularly to the rise of new conflicts globally; the deterioration of environmental resources; demographic changes; the failures of economic growth; the transition of state-led economies to 'market-based' systems and the spread of diseases such as HIV/AIDS. In all this however, perhaps the greatest challenge to poverty eradication will come from the effects of liberalization and globalization, the true impact of which is not yet fully determined.
Poverty eradication and the effects of liberalization and globalization
The process of globalization has led the adoption of more
open economic policies by most countries and has accelerated the insertion of
developing countries into the world economy.
Financial liberalization has brought about an explosion of private
capital flows across national boundaries unparalleled before in the world economy. These processes too, have been accompanied
by rapid developments in media technology and communications and are helping to
foster a 'global' culture of ideas, lifestyles and values.
It is the case that globalization and liberalization have
brought about an expansion in world trade.
While this expansion has led to very high growth rates and increased
living standards, this is concentrated in particular regions, for example,
Asia. Of course, the recent financial
crisis in Asia, which has engulfed some
of the best performing economies, will alter this picture
dramatically.
By contrast, the least developed countries with 10 percent of the world's people, experienced a decline in their share of trade over the past two decades.
It is an indisputable fact too, that globalization has led to significant growth in private capital flows to developing countries. But like the growth in world trade, its benefits have only been had by a handful of developing countries and a third of them have seen a decline in their shares of foreign direct investment to GDP over the past decade.
Several factors might explain these skewed flows. These include poor domestic policies; unfavorable terms of trade and finance; and unfair trading rules.
What does all this mean for the poor
within countries?
It is clear that globalization has
profound implications for all states.
In all cases it has led to a reduced role of the state, accompanied by
privatization of public enterprises and job losses.
The literature on trade theory does
suggest that the poor will
gain from trade liberalization. That
is, developing countries have a comparative advantage in cheap labor and the production of labor intensive
goods. These factors, coupled with
integration into global markets should increase exports and outputs, raising
the demand for unskilled labour and
incomes.
Benefits too, should also accrue if
restrictions on capital are removed and foreign direct investment increases,
thus creating more jobs.
But in many cases, these benefits have not occurred. While the effects of globalization on poverty are still unclear, it is apparent that liberalization has led to greater inequality and declining incomes for the poorest 20 percent as evidenced in certain countries of Latin America, for example, Ecuador, Uruguay and Mexico.
The challenges posed by globalization include blending factors such that:
· competition is encouraged while protecting the
weak,
· selective interventions by the state while fostering private sector developing, civil society involvement and people centered development,
· efficient and effective allocation of resources with distributive justice and social development and,
· most importantly, technological (information) and skills upgrading in support of enhanced economic growth and human development.
As noted earlier, other new global pressures that are creating and re-creating poverty include:
· The rise in the number of conflicts within national borders.
· The HIV/AIDS pandemic.
· Deterioration in environmental resources
· Lack of economic growth
With regard to the latter there is much
evidence to suggest that economic growth does lead to poverty eradication. In fact, it can increase the productivity
and incomes of poor people and expand opportunities and choices in a variety of
ways. For example, sustained GDP growth
in certain developing countries, namely China and up until recently the NICs,
saw a dramatic reduction in income poverty and other critical dimensions.
However, it is clear that economic growth by itself is not
sufficient to reduce poverty. The
structure and quality of growth must be given due attention. The phenomenon of "jobless
growth", that is, where the overall economy grows, but does not expand
opportunities for employment is now well known. There is also the phenomenon of 'growthless jobs', in countries
where people see their incomes dropping.
That is, employment opportunities have expanded but these are in
low-productivity, low-paid jobs.
All this implies that there is no automatic link between
economic growth and human development and employment. Short-term advances in human development are possible, but they
will not be sustainable without further growth. The converse is also true.
That is, economic growth is not sustainable without human development.
I now turn to discuss the situation in respect of the poor
in Jamaica.
As is already well
known, the intense macro-economic adjustments that have been undertaken over
the past several years in Jamaica, while positive in some respects, have
impacted most negatively on the poor and other vulnerable groups.
I should indicate that at this time, it is not possible to
discuss poverty from a human development standpoint as the data and analysis is
not readily available. However, UNDP
is supporting the Government of Jamaica in its collection of social sector data
and analysis and it is expected that later this year, the first National Human
Development Report that treats with poverty from a human development
perspective, will be launched.
If one were to look at income poverty, the poor can be
defined as that segment of the population whose income fall below the poverty
line and who are therefore unable to satisfy their basic requirements for
life. In 1989, the proportion of the
poor was approximately 29.3% while by 1996 this figure had declined to 19.9%.
Regarding distribution of the poor, of the total number in
1994 some 50% were women and 61% were less than 25 years. Among those in the under 25 age group, 40%
were less than 14 years and 36% under 5 years of age. These figures suggest that a disproportionate share of the poor
can be found among the youth and as well, women.
A further disaggregation by gender and location reveals
that, women constitute 53% of the poor in the Kingston and Metropolitan area
and 50% in rural areas. Indeed, while
both sexes are almost equally poor, women suffer from higher rates of
unemployment. In 1994, 21.8% of women
were unemployed compared to 9.6% of men.
In a country where 45% of households are female-headed, this
unemployment figure has serious consequences for the health and standard of
living within many homes. Despite both
sexes being equally poor, women experience more severe poverty than men because
of higher dependency ratios in female-headed households as well as wage
differentials in the labour market arising from gender discrimination. Jobs in which women predominate tend to
attract lower wages than male-dominated occupations. Women also attract lower wages for the same work despite having
comparable or higher qualifications than men have.
Another growing segment of the poor can be found among
street children. About 23% of children
6-12 years from poor families seldom attend school. They can be found working to support their families. Some of them end up living on the
street. It is to be noted that even
those who attend secondary school many have no certification and therefore join
the ranks of the unemployed or become low wage earners.
A newly emerging category is that of the “working
poor”. These include farmers,
agricultural labourers, domestics, and street vendors and craft persons. The working poor originates from the impact
of high inflation on income, without commensurate increases in the latter.
Regarding the geographical spread of the poor, some 60%
reside in rural Jamaica. These are
small hillside farmers, fishermen, households headed by female farmers,
unskilled wage labourers and unemployed youths. For the most part, their lack
of assets prevents them from accessing credit through formal lending
institutions. Most exist at near
subsistence level on poor quality land.
In relation to the urban poor, who account for 40% of the
impoverished, many reside in inner city communities that are characterized by
unemployment, crime, unsanitary conditions and poor housing. Moreover, inner city communities are highly
politicized thus creating additional tensions that at times lead to increased
violence among these groups.
In summary, poverty is dominant in the rural areas, although
in the urban areas it is more severe.
Indeed, while the rural poor usually suffer from income poverty, they
generally have access to food and shelter.
They are restricted by inadequate economic infrastructure that acts as a
constraint on their ability to expand their businesses or to make them
profitable. Small rural farmers are
particularly vulnerable in this regard.
Yet, as a group they have the potential to make a significant
contribution to growth in the domestic economic and to increase food security
at the national level.
The urban poor, on the other hand, are by and large
dependent upon low wages, live in overcrowded and poor housing facilities, and
lack basic social amenities. It is the
case too, that while many urban communities in Jamaica are peaceful, some in the
poor inner cities are characterized by, crime and violence on a daily
basis. In this latter regard, it is
argued by many, that the causality between violence and urban poverty is
difficult to determine. That is,
violence leads to more poverty, which in turn leads to more violence.
As a group, the
poor do not possess the requisite human capital, that is, access to good health
care and education to obtain remunerative employment. Moreover, they do not have available other tangible assets, namely
physical assets, such as land and housing or intangible assets, such as social
capital and household relations.
Traditional poverty reduction strategies have focussed quite
correctly on improving the human capital of the poor in order for them to take
up jobs. As well, it has been argued
that on account of the close nexus between urban poverty and violence,
effective poverty reduction strategies must contain as a critical element, the
reduction of violence. In this
connection, the strengthening of social capital through fostering community-based groups and organizations,
which should in turn increase the returns to investments in human capital, is
another critical element in the fight to reduce poverty. Many donors and lenders are focussing their
programmes in the area of poverty reduction.
SELECTED POVERTY
PROGRAMMES OF DONORS/LENDERS
It is the case that most of the
development assistance provided by donors and lenders to the Government of
Jamaica is geared toward supporting the implementation of the National Poverty
Eradication Programme elaborated in 1997.
Currently the single largest donor in
Jamaica is the European Union. Under
the first three Lome Conventions, the principal sectors of economic cooperation
were in the areas of road and water infrastructure, agriculture, support to
small and micro-enterprises, and trade and investment promotion. The European Union continues to direct its
development cooperation assistance to infrastructure and trade promotion and
investment, which does bear on poverty reduction. However, a specific poverty programme has been formulated,
targeting the most vulnerable groups, especially youth.
Other major programmes under the EU’s
poverty alleviation theme include allocations to rural water supply (17 million
ECUs), agricultural development, credit for small and micro enterprises, and
public health.
The United States Agency for
International Development (USAID) directs most of its programmes toward poverty
reduction. These include support to
micro-enterprise development with the aim of increasing employment
opportunities for the economically disadvantages and assisting in the creation
of own employment; enhancing the social and job skills of youth at risk on a
sustainable basis so that they might become more responsible and productive;
and improving the literacy and numeracy of primary school students who are most
“at risk”.
In respect of CIDA’s poverty programme
in Jamaica, significant resources are provided in support of the provision of
credit for micro and small enterprises.
This programme which is executed by Bank of Nova Scotia and Kingston
Restoration Company aims to provide equitable access to credit by supporting
the development of a self-sustaining organization which focuses on lending to
micro entrepreneurs who have no collateral.
Another important project in CIDA’s
portfolio relates to strengthening the capacity of local NGOs and CBOs in order
to undertake poverty reduction activities in the urban city communities of
Kingston.
As noted, invariable the poor lack
access to proper health care and other basic amenities required for a decent
standard of living. PAHO’s poverty
programme therefore supports the provision of adequate and consistent supplies
of potable water and rehabilitation of existing and construction of new
facilities for excreta disposal in the South St. Andrew and East Central St.
Andrew areas.
Finally, with regard to UNDP’s poverty
programme, emphasis is placed on empowering communities to play a major role in
their own development. To this end,
assistance has been provided to support community-based workshops for devising
an integrated community development model.
Efforts have also been initiated to identify sustainable income
generating projects in selected communities.
Other programmes that are supported
related to the Local Initiative Facility for Urban Environment that seeks to
improve environmental management, particularly in urban centers, by promoting
dialogue and collaborative action among municipal bodies, NGOs and CBOs. Thus far, the programme has concentrated on
providing access to water and sanitation, and improving public awareness on
environmental and governance issues.
UNDP’s poverty programme also supports training and counselling to women
engaged in micro enterprise. Support
too has been provided for strengthening the capacity of the
government-designated lead agency – the Social Development Commission – through
staff training, data collection and the development of monitoring instruments.
While the fore-going is by no means a
comprehensive detailing of donor/lender programmes in the poverty sector in
Jamaica, it is clear that support to poverty eradication programmes among this
group is a top priority. This is in
line with the objectives of the Government of Jamaica. As well, given the concentration of
programmes in this sector, the case is strong for enhanced coordination among
the donor/lender community.
CONCLUDING REMARKS
I wish to conclude this presentation by observing that in
general, strategies for economic growth that emphasize people and their
productive potential are the only way to open opportunities for the poor. While such strategies must be specific to
the particular country context, and one would need to be far more specific in the
context of Jamaica, broadly they will entail: placing poverty eradication as a
priority objective of the national development strategy; raising the
productivity of small-scale agriculture; encouragement of the informal sector
and the promotion of small and micro-enterprises; accelerating the expansion of
human capabilities by investments in education and training and in health;
governments' interventions in the labor market and the provision of access to
productive assets such as land and credit.
Poverty eradication in Jamaica, given its multi-faceted
nature will require concerted effort on the part of all sectors of society -
the private sector, civil society groups, the donor/lender community and most
importantly the government.
I thank you.