World Bank: End ‘ex­treme’ poverty

Bank group pres­i­dent says sus­tain­able, in­clu­sive growth is key

China Daily (USA) - - ACROSS AMERICA - By CHEN WEIHUA in Wash­ing­ton chen­wei­hua@chi­nadai­lyusa.com Xin­hua con­trib­uted to this story.

World Bank Group Pres­i­dent Jim Yong Kim called on Mon­day for more global ef­forts to end “ex­treme” poverty in the world by 2030 and to boost shared pros­per­ity.

In a talk at the Brook­ings In­sti­tu­tion, Kim laid out three pil­lars that he said will help achieve the goals. They in­clude ac­cel­er­at­ing in­clu­sive and sus­tain­able eco­nomic growth, in­vest­ing in hu­man cap­i­tal and fos­ter­ing re­silience to global shocks and threats.

A World Bank re­port on Sun­day, ti­tled Poverty and Shared Pros­per­ity 2016, said that there are fewer peo­ple liv­ing in ex­treme poverty today, but the chal­lenge is still enor­mous to hit a global poverty-re­duc­tion goal by 2030.

Kim cited the fact that in­come in­equal­ity be­tween all peo­ple in the world has de­creased, and in­equal­ity within na­tions has been fall­ing in many coun­tries, both rich and poor. But in­equal­ity is still far too high, both glob­ally and within coun­tries, in­clud­ing in China, he said.

He de­scribed the sit­u­a­tion as con­strain­ing growth and breed­ing in­sta­bil­ity.

“This means that not only do we need to fo­cus on growth, but we must also con­tinue our work to re­duce in­equal­ity — we have to make growth more eq­ui­table,” he said.

Kim, a physi­cian and an­thro­pol­o­gist by train­ing, called for beef­ing-up in­fra­struc­ture fi­nance to boost eco­nomic growth, with far greater pub­lic-pri­vate co­op­er­a­tion on in­fra­struc­ture in­vest­ment. But with in­creas­ing re­liance on pri­vate sec­tor in­vest­ments, the World Bank Group will have to in­crease its vig­i­lance to en­sure that pri­va­ti­za­tion does not ex­clude the poor and marginal­ized.

“Our top pri­or­ity is to end ex­treme poverty and boost shared pros­per­ity, and our en­gage­ment with the pri­vate sec­tor must be anchored in these two core val­ues,” he said.

Kim ex­pressed his con­cern of the grow­ing iso­la­tion­ism and pro­tec­tion­ism when the world needs more co­op­er­a­tion and eco­nomic in­te­gra­tion and stronger part­ner­ship. He said many peo­ple ex­pressed such con­cern to him at the G20 Sum­mit in Hangzhou last month.

Ac­cord­ing to Kim, more than 1 bil­lion peo­ple have es­caped ex­treme poverty since 1990. “Great strides of end­ing ex­treme poverty have been made by coun­tries such as China as a re­sult of trade and open­ness of their do­mes­tic in­dus­tries to global com­pe­ti­tion,” he said.

“Coun­tries work­ing to­gether and es­pe­cially trad­ing to­gether have de­liv­ered last­ing progress,” said the Korean Amer­i­can, who took up the cur­rent job in 2012.

Kim’s talk came on the eve of the 2016 IMF/World Bank an­nual meet­ing in Wash­ing­ton this week.

“Much of the suc­cess in poverty re­duc­tion glob­ally has ac­tu­ally been driven by China’s in­cred­i­ble suc­cess in re­duc­ing poverty,” said Ana Re­venga, se­nior di­rec­tor of poverty and eq­uity global prac­tice at the bank, in a Xin­hua re­port. Sig­nif­i­cant progress also has been made in In­done­sia and In­dia.

De­spite the good news, “there is no room for com­pla­cency”, said Fran­cisco Fer­reira, se­nior ad­viser to the bank’s Devel­op­ment Re­search Group.

The World Bank re­port showed that half of the world’s poor­est peo­ple now live in sub-Sa­ha­ran Africa, while another third live in South Asia.

“The pock­ets of poverty that re­main will be­come in­creas­ingly harder to reach and ad­dress,” Fer­reira said.

The re­port fore­cast that the world would be un­able to achieve the goal of end­ing ex­treme poverty by 2030, even un­der optimistic sce­nar­ios for growth and with no change in the lev­els of in­equal­ity. The World Bank set a tar­get to re­duce the global poverty head count ra­tio from 12.4 per­cent in 2012 to 3 per­cent by 2030.

China has pro­vided a les­son to the rest of the world on how to tackle ex­treme poverty in a quick way, Re­venga said. “If any coun­try can show the world how to do that last mile (to end ex­treme poverty), it is prob­a­bly China.”

Coun­tries work­ing to­gether ... have de­liv­ered last­ing progress.”

Jim Yong Kim, World Bank group pres­i­dent

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