How 28 poor countries escaped the poverty trap

[pampango]

http://www.guardian.co.uk/global-development/poverty-matters/2011/jul/12/world-bank-reclassifies-28-poor-countries

Zambia and Ghana are the 27th and 28th countries the World Bank has reclassified as middle-income since the year 2000

The World Bank did its annual assessment of poor countries last week. Low-income countries are those with average gross national incomes (GNIs) of less than $1,005 per person per year. And there are only 35 of them remaining out of the countries and economies that the World Bank tracks. That's down from 63 in 2000. New middle-income countries this year include Ghana and Zambia.

...the continent is fast drawing in more investment. Foreign direct investment to Africa is projected to rise to $150bn by 2015, reports the Africa Attractiveness Survey (that's more than the total global aid budget) – and domestic resources are being mobilised at a faster rate, too, as the Commission for Africa 2010 report discussed.

What shall we take from this? Three things. First, consider the good news that there are fewer poor countries around. Not least, it suggests that public and private investment (including aid) can help even the poorest countries get rich(er). This is one more reason why optimism should come back into fashion.

Second, the World Bank country classifications - which are used to help determine types and levels of support provided by many aid agencies - may need a rethink. ... And the data suggests these aren't just poor countries by another name - they really are better off than low-income countries, not only in terms of average income but by human development and other development indicators too. We need aid allocation models to take account of poor people and of deprivations beyond income - not just poor countries with a low GNI. And fewer poor countries and poor people in time also suggests greater aid funds for global public goods - be these for climate adaptation, vaccines or other shared global issues that will shape the next 25 years.

Third, as countries develop their own resources, fighting poverty becomes increasingly about domestic politics. Not surprisingly, this means inequality is rising up the agenda. New research shows that the emerging middle classes may have a big role to play.

[dipsydoodle]

1. Probably because

the don't / no longer spend money they've not got - unlike most of the west.

[Demeter]

2. Probably because they avoided the IMF/World Bank -ster Trap

[pitohui]

3. actually it doesn't sound as if they have, $1005 a year income is NOT middle class

are they out of their fucking minds?

an income of $1,005 a year is desperately poor, not middle class

i guess this is one of those articles where you're supposed to read the headlines and think africa is fine, all fixed now

what a cruel hoax

[pampango]

4. Whatever term you want to use, there are fewer and fewer countries in that poorest group.

That's progress.

It's obviously not the end of the struggle to improve the lives of the people in these countries. Indeed it is just the beginning, but at least it is a beginning rather than a continuation of hopelessness.

You and I can look at someone's whose income goes from $800 to $1200 a year and critical of how little $1200 is. If you've known any poor folks in the Third World, an increase of 50% in their income improves their lives in a measurable way and they can feel it. Obviously they still know that they are not Americans or Europeans, but it gives them some hope for the future that many did not have before.

And countries that saw that initial gain from abysmally poor to just really poor later went on to see continued growth of incomes like in South Korea and China. There's obviously no guarantee that Ghana and Zambia will go on to become an African "South Korea" with a per capita income ($30,000) like that of the EU), but there was no guarantee South Korea would emerge from its extreme poverty in 1950 like it did.

These are great first steps and are essential if further progress is to be made, but that's all they are are first steps.