World Bank Proffer Three Ways To Achieve Growth And Poverty Reduction

The World Bank President, Jim Yong Kim, in the statement released at the formal opening of the IMF/World Bank spring meeting, has revealed three initiatives under its current plan to end extreme poverty within a generation, especially in developing countries.

According to Kim, “if we are to end extreme poverty within a generation, we’ll need at least three things to happen. First, the high growth rate in the developing world over the past 15 years must accelerate.  Second, growth has to translate into poverty reduction and job creation and it must be inclusive and curb inequality. And third, we must avert or mitigate potential shocks, such as climate disasters or new food, fuel, or financial crises.

“In particular, doing better on growth means doing even more of the kinds of reforms that have underpinned the strong developing-country growth of the past 15 years. That means eliminating bottlenecks; additional investment in infrastructure; and, to ensure that the poor participate in the benefits of growth, much greater investments in education and health care,” he said.

While admitting that the task of ending extreme poverty within a generation is difficult, Kim said it would require “ingenuity, focus, commitment, and visionary leaders. But if we succeed, we will have accomplished one of humankind’s most historic accomplishments.”

Kim said the anti-poverty must be far more effective in fragile and conflict affected nations, hence the bank’s determination “to shift more funding toward fragile states under our concessionary lending fund, the International Development Association, or IDA. If we hope to meet our goals of ending poverty and boosting shared prosperity, we must be successful in fragile states.”

Kim noted that the bank spent $9 billion on agriculture last year, as part of large “investments in areas like sustainable energy, agriculture — looking, for example, at how to build clean cities. Those are things that we do all the time and we’re doing everything that we can to be more climate smart in every one of those activities.”

"As we move ahead, we also must address climate change with a plan that matches the scope of the problem. Climate change is not just an environmental challenge. It is a fundamental threat to economic development. Unless the world takes bold action now, a disastrously warming planet threatens to put prosperity out of reach of millions and roll back decades of development.

Recently, the World Bank outlined an ambitious agenda for the global community that called for a two-pronged approach for a world free of poverty.

The first is virtually ending extreme poverty by 2030. The second is promoting shared prosperity by fostering income growth of the bottom 40 percent of the population in every country. And for that second goal, we also mean sharing prosperity across generations, and that calls for bold action on climate change.

According to the World Bank "ending extreme poverty within a generation will be much harder than most people realise. It is far from a given. It will take ingenuity, focus, commitment, and visionary leaders. But if we succeed, we will have accomplished one of humankind’s most historic accomplishments.

"Let’s take a look at the situation in the world today.  More than four years after the start of the financial crisis, high-income countries continue to struggle with high unemployment, weak growth and economic fragility.

"The good news is that taken as a whole developing countries are doing relatively well, with growth expected to reach about 5.5 percent this year. That should strengthen to just under 6 percent by 2015. Indeed, developing countries are accounting for more than half of global growth.”