Tackling Inequality Is Vital to Ending Extreme Poverty by 2030

Extreme poverty worldwide continues to fall despite the lethargic state of the global economy. With this positive message Mario Negre, World Bank senior economist, opened the presentation event of the report “Poverty and Shared Prosperity 2016: Taking on Inequality”, organised by  ISGlobal and "la Caixa" Foundation at the CaixaForum Barcelona. He warned, though, “that reducing high inequality may be a necessary component to reaching the world’s goal of ending extreme poverty by 2030.”

Nearly 800 million people lived on less than US $ 1.90 a day in 2013, mainly in Sub-Saharan Africa and South Asia. That is around 100 million fewer extremely poor people than in 2012, a reduction driven mainly by growth in China and India. But although growth is important in driving poverty reduction, current growth rates will not be enough to reach the 2030 goal and we know that global growth forecasts are grim. Therefore “we must make growth work for the poorest, and this is best achieved by reducing high inequalities, especially in those countries where many poor people live.”

By studying a group of countries including Brazil, Cambodia, Mali, Peru, and Tanzania, which have reduced inequality significantly over recent years, World Bank researchers identified the following six high-impact strategies: policies with a proven track record of raising poor people’s earnings, increasing their access to essential services, and improving their long-term development prospects, without damaging growth:

• Early childhood development and nutrition
• Universal health coverage
• Universal access to quality education
• Cash transfers to poor families
• Rural infrastructure- especially roads and electrification
• Progressive taxation

“With global economic growth expected to slow in the years to come, it will be ever more important for countries to make a concerted effort to reach the least well-off with policies and programs that can help them move upward,” concluded the World Bank economist.

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