World Bank Releases World Development Indicators Seeking Alpha
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1 Page 1 of 6 World Bank Releases World Development Indicators 2007 Posted on May 27th, 2007 Toro submits: Global poverty rates continued to fall in the first four years of the 21st century according to new estimates published in the World Development Indicators 2007, that was released on Saturday. The proportion of people living on less than $1 a day fell to 18.4 percent in 2004, leaving an estimated 985 million people living in extreme poverty. By comparison, the total number of extreme poor was 1.25 billion in Two-dollar-a-day poverty rates are falling too, but an estimated 2.6 billion people, almost half the population of the developing world, were still living below that level in Developing countries have averaged a solid 3.9 percent annual growth in GDP per capita a year since 2000, which contributed to rapidly falling poverty rates in all developing regions over the past few years. Another key reason that dollar-a-day poverty fell by over 260 million between 1990 and 2004 was China's massive poverty reduction over that period. East Asia's extreme poverty rate actually dropped to 9 percent in In the rest of the developing world, good economic performance, and a lower incidence of poverty in most regions have offset a rise in the sheer numbers of poor people that might have otherwise accompanied population growth. In Sub-Saharan Africa, 298 million people were living in extreme poverty in 2004, practically the same number as in 1999, whereas the number of poor had increased continuously in the previous two decades. The following graphs are taken from the report. The number of poor have dramatically declined since Most of the reduction has occurred in East Asia, while in sub- Saharan Africa, the number of poor has risen. Economic growth is the key to poverty reduction. As obvious as this may sound, many argue that nations should focus on redistribution first.
2 Page 2 of 6 Fortunately, growth has accelerated for poor and middle income countries. But, unfortunately, this growth is not being shared proportionately, and inequality is on the rise. Countries that are more open to free trade grow faster.
3 Page 3 of 6 That is important because global trade is growing faster than economic growth. The good news is that exports from emerging markets are increasing at a fair clip. And, investment flowing into developing nations is also soaring.
4 Page 4 of 6 There is a direct correlation between the high costs required for starting up a new business, and low growth. The higher the costs, the lower the growth. Corruption also increases the cost of business. Therefore, it is not coincidental that low levels of corruption, and good governance, lead to higher rates of growth. On the subject of aid, about half of all spending go towards direct expenditures in the recipient country.
5 Page 5 of 6 There is more good news. Child mortality is falling at all levels but, it is still very high in poor nations. Rising income lowers child mortality. And, countries that experience contracting economic growth experience rising mortality rates. The quality of health care in developing countries is highly dependent on your level of income.
6 Page 6 of 6 And, oddly enough, public spending on health care benefits the rich the most. And one final note, access to clean water has improved almost everywhere. Print this article this article
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