ECONOMY: Global Economy Mending But Poverty Rising

Copyright 1999 InterPress Service, all rights reserved. Worldwide distribution via the APC networks.

*** 07-Dec-99 ***

Title: ECONOMY: Global Economy Mending But Poverty Rising

WASHINGTON, Dec 7 (IPS) - The World Bank said Tuesday that, while the global economy is on the mend, progress in reducing poverty in the developing world had stalled.

''The picture that emerges at the turn of the century is one of stalled progress for the poor and of rising numbers of poor people in most developing regions,'' the bank said.

In its annual report 'Global Economic Prospects and the Developing Countries' the bank said that the financial crisis that began in 1997 underlined how globalisation exposed developing countries to shocks that can increase poverty.

''While the global economy clearly is on the mend...the fact is that many developing countries throughout the world remain in a very difficult position,'' said Uri Dadush, the director of the World Bank's development prospects section. ''They are going better, but they are not doing well.''

The report said that in 1998, the number of people throughout the world living on less than one dollar totalled 1.2 billion - the same as in 1987. The number fallen in the middle of this decade but the global financial crisis halted this decline, it noted.

A particular problem for Asia was that many businesses and banks remained in severe difficulties, the bank said. Loans were not being repaid and there was a high level of bankruptcies.

The report said there was a need for vigorous restructuring of such businesses - which meant the closure of weaker firms , or takeovers and mergers.

The bank stopped short of predicting that its goal to cut poverty in half by the year 2015 would not be met, but underlined that the recovery from the worst effects of the financial crisis was ''uneven and fragile.''

It put forward two scenarios to show what could happen to the numbers of poor people in various regions:

- East Asia and the Pacific would be on track to meet the goals - but the world as a whole would not - in one scenario in which growth rates were low and there was an increase in ''inequality'' or the way in which money is distributed among people.

- in the second scenario, poverty reduction could be achieved in South Asia and the world as a whole along with more rapid and more inclusive growth. Sub-Sahara Africa and Latin America, however, would remain below the anti-poverty targets.

Dadush concluded that ''ten years from now, we may well be looking at numbers of poor people, not terribly different from today...or significantly larger.'' (END/IPS/mk/99)

Origin: ROMAWAS/ECONOMY/

Copyright 1999 InterPress Service, all rights reserved. Worldwide distribution via the APC networks.

*** 07-Dec-99 ***

Title: ECONOMY: Global Economy Mending But Poverty Rising

WASHINGTON, Dec 7 (IPS) - The World Bank said Tuesday that, while the global economy is on the mend, progress in reducing poverty in the developing world had stalled.

''The picture that emerges at the turn of the century is one of stalled progress for the poor and of rising numbers of poor people in most developing regions,'' the bank said.

In its annual report 'Global Economic Prospects and the Developing Countries' the bank said that the financial crisis that began in 1997 underlined how globalisation exposed developing countries to shocks that can increase poverty.

''While the global economy clearly is on the mend...the fact is that many developing countries throughout the world remain in a very difficult position,'' said Uri Dadush, the director of the World Bank's development prospects section. ''They are going better, but they are not doing well.''

The report said that in 1998, the number of people throughout the world living on less than one dollar totalled 1.2 billion - the same as in 1987. The number fallen in the middle of this decade but the global financial crisis halted this decline, it noted.

A particular problem for Asia was that many businesses and banks remained in severe difficulties, the bank said. Loans were not being repaid and there was a high level of bankruptcies.

The report said there was a need for vigorous restructuring of such businesses - which meant the closure of weaker firms , or takeovers and mergers.

The bank stopped short of predicting that its goal to cut poverty in half by the year 2015 would not be met, but underlined that the recovery from the worst effects of the financial crisis was ''uneven and fragile.''

It put forward two scenarios to show what could happen to the numbers of poor people in various regions:

- East Asia and the Pacific would be on track to meet the goals - but the world as a whole would not - in one scenario in which growth rates were low and there was an increase in ''inequality'' or the way in which money is distributed among people.

- in the second scenario, poverty reduction could be achieved in South Asia and the world as a whole along with more rapid and more inclusive growth. Sub-Sahara Africa and Latin America, however, would remain below the anti-poverty targets.

Dadush concluded that ''ten years from now, we may well be looking at numbers of poor people, not terribly different from today...or significantly larger.'' (END/IPS/mk/99)

Origin: ROMAWAS/ECONOMY/