Document Sample
POVERTY IN THE OECS Powered By Docstoc
					Poverty in the OECS - Issues and Challenges
Issues and Challenges in Reducing Poverty

Poverty is a complicated issue touching on various areas. In a review of various poverty
associated organization across the globe it was found that their definitions of poverty varied
considerably, each including or leaving out different aspects related to the topic. With a fifth of the
planet's people living on less than $1 a day1[1], poverty remains an important issue impacting not
only those effected but society as a whole.

Whilst poverty is often reduced to income or hunger it is in fact a relative phenomenon with
multiple facets. Absolute poverty can be defined as the minimum basic needs necessary to
survive, such as adequate food, drinking water, clothing and shelter.

From a broader perspective, poverty touches on many social and economic areas including
employment, sufficient income to afford a basic basket of goods and to participate in
consumption or afford material well-being. Further concerns in regards to poverty are
education, social exclusion, a long life expectancy and low child mortality to be obtained
through the ability to maintain good health determined through such factors as malnutrition,
access to clean drinking water and hygiene.

Moreover, HIV/Aids, drugs and the disproportionate risk for woman and minority groups to
experience poverty or social exclusion due to unequal opportunities has become a focal problem
when with regards to poverty/when considering successful strategies for eradicating poverty.

Additionally, poverty can be said to also reflect:

    1. Vulnerability and exposure to the risk of negative shocks to their income and welfare; and
    2. Voicelessness and powerlessness

These points are of particular interest to policy makers in poor and small island countries that are
affected by powerlessness and a unique vulnerability in the global market economy within which
they must function.

For the coming century the United Nations and its quasi-independent agencies (such as the
World Bank or the International Monetary Fund [IMF]) have set the fight against poverty as a
matter of the very highest priority.

The Millennium Development Goals (MDGs) are the main guiding principle for the work of UNDP.
MDG Goal 1 which seeks to achieve a 50% reduction in those living in absolute poverty by 2015
is a principle goal which al agencies, including UNDP, is working with partners, governments and
communities to achieve.

Smallness and Vulnerability

Small island countries, like those in the Eastern Caribbean, with limited natural resources, poorly
diversified economies and limited access to larger markets are more likely to experience poverty
and consequently have every right to request appropriate support to help deal with their extreme
Due to the limited opportunities for profits afforded by their own small domestic markets, world
market prospects for trade are crucially important in the investment decisions of small island
states. Accordingly, small countries are also much more vulnerable to shocks from the global
economy. Moreover, the Caribbean in particular, is often faced with shocks from natural
disasters such as hurricanes, which further disrupt economic activity and reinforce poverty.
Recovery from such situations is much more difficult for smaller countries.

Characteristics of Poverty in the OECS

Over the last 10 years, the average growth rate of economies within the OECS sub-region have
experienced, a decline to approximately 2% in 2000, from 4.5% in the late 1980s. .2[1] In the
Human Development Report of 2004, 5 out of the 10 countries covered by the UNDP Barbados
and the OECS office were in the top 50 in the Human Development Index. Though the region has
recorded significant progress in human development particularly with regard to literacy, access to
education, reducing child and maternal mortality, there remain areas of significant concern
including relatively high level s of poverty as can be noted in the table below.

                              Poverty Profile in OECS Countries

                                 Country           %       Gini Co-
                                                 Below     efficient
                                 Anguilla          n/a       0.31*
                                 Grenada           32        0.45
                                  St Kitts         31        0.40
                                 St Lucia          19        0.50
                              St Vincent and       33        0.56
                                 Dominica          33         0.49
                                  Antigua          n/a        0.53
                                    BVI            n/a        0.23
               Source:   *UNDP Draft Report ' Follow-up to High-level Meeting on MDGs 2004
                                          **OECS HDR 2000

Poverty is often only recognized when associated with mortal outcomes. Yet, poverty in the
OECS has a different, less obvious face. Although people may not be starving, their standard of
living is poor and caught in the viscous circle. Oftimes, low education, low skill, low income jobs
have characterized slow human and social development in some countries. Access to services
remain a challenge in some remote and poor communities where, for example, monthly
telephone          and          Internet         access         costs         remain          high. Thus, in order to realize the Millennium
Goals and eradicate poverty, these issues must also be addressed.

Other Contributing Factors to Poverty in Small Countries
        Financial crisis: It has become clear that financial crises can spill over national borders to
         inflict severe social and economic damage, even when governments have been
         managing their own budgets prudently and have had little prior indication of deficient
         macroeconomic conditions or economic mismanagement. Sometimes volatile private
         international capital flows can impact significantly on small economies.
        Poverty as Voicelessness: In relation to global issues, small, as compared to large or
         medium sized countries, have only a very weak voice and limited power. Due to their
         small governmental scale, small countries are often unable to attend all meetings and
         participate effectively within multilateral decision-making and the implementation of
         systems that may affect their welfare, development, rights or other socio-economical
        Shifting International Trade Patterns and Arrangements: For small countries membership
         of major trade agreements raises important economic and political issues. Economic
         integration of this kind reaches far beyond trade effects. Precipitating further liberalization
         could engender significant early economic and social losses, in the form of increased
         unemployment and underutilization of existing capital before gains can be realized.
         Moreover, these countries' fiscal systems, heavily dependent upon trade taxes, must
         adjust slowly in order to reduce the destabilization of public finances and thus the macro-

Poverty Reduction at National Level
Domestic measures of poverty reduction are severely constrained by the performance of the
overall domestic economy and its own financial situation.

The new concern over voicelessness offers the possibility of remedial measures in the sphere of
empowerment of the poor, even in the most strained economy. To address poverty problems
directly, it appears only logical to involve those who are directly affected by it. So-called 'Poverty
Reduction Strategies' can be put together in an inclusive and participatory fashion, and the
inputs, processes and results of attempts at their implementation carefully and independently

Based on the major contributing factors to poverty - the impoverished state in which a person
lives and the lack of real opportunity as a result of social constraints and personal circumstances
- UNDP and the OECS Secretariat have sought to implement initiatives to facilitate poverty
reduction and social policy formulation.

Many of the problems concerning poverty in the OECS have been listed as important goals to
achieve within the scope of the millennium goals (MDG). UNDP has thus adopted the MDGs
within its support framework to Barbados and the OECS and countries have committed to
achieve the MDGs as part of the national, sub-regional and global commitments. OECS
countries have, in practical ways, sought to meet these goals for development in areas such as:

       literacy and numeracy capacity
       reducing the risk of non-communicable diseases
       advocacy for HIV/AIDS awareness for a positive impact on economic and social
       the potential social impacts of changing trade regimes which require assistance at both
       the national and sub-regional levels

Poverty reduction requires more than improvements in material income. It calls for increased
protection from external economic volatility beyond the control of small island states, for
empowerment and recognition of the voice of the poor. Small countries are uniquely vulnerable to
external shocks and therefore require internationally supportive measures to buffer them more
effectively against such shocks. Special funds and arrangements are urgently needed for this
purpose and should be integral elements in any future global financial or trading agreements.

There needs to be a provision for special legal and technical assistance as well as flexibility in the
application of universal rules to permit small countries to fully realize their economic opportunities
within emerging multilateral trading arrangements.

At the national level reduction strategies should target problems directly by leaving room for those
affected to participate in the process with their own 'voice'.