Magazine article Stanford Social Innovation Review

The New Bottom Billion

Magazine article Stanford Social Innovation Review

The New Bottom Billion

Article excerpt

ECONOMIC DEVELOPMENT

Aid is increasingly focused on the "bottom billion" in extremely poor, mostly African, nations. But according to a new analysis, most of the world's poor no longer live in these countries.

The 960 million poorest people on the planet-or three quarters of the 1.3 billion who make less than $1.25 per dayare now in middle-income countries, says Andy Sumner of the Institute of Development Studies in Sussex, United Kingdom. What happened is that "most of the world's poor live in a relatively small number of countries, countries like India and Nigeria, which have become richer in average terms" and recently graduated from low-income to middle-income status, Sumner says. "But at the same time, poverty doesn't seem to have fallen much." The new wealth hasn't been broadly distributed.

Back in 1990, it was true that poor people (93 percent of them) lived in poor countries. In such a world, ameliorating global poverty is more straightforward, Sumner says: "It's about aid and resource transfer." But when most poor people live in countries with substantial domestic resources, giving money isn't enough. It "pushes development in ultimately a more political direction," he says.

Traditional donors and international NGOs may move "toward thinking about how they can support progressive forces of change," Sumner says. It is now even more important to "build up and support the expansion of local civil society in developing countries, so that local NGOs can call their own governments to account."

Fragile middle-income countries such as Nigeria and Pakistan may still benefit from development assistance, but governance and domestic taxation and redistribution policies are becoming more important. …

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