Youth in Extreme Poverty
Youth in Extreme Poverty: dimensions and policy implications with particular focus on South East Asia
Richard Curtain Professional Associate National Institute for Governance Curtain Consulting, Melbourne www.curtain-consulting.net.au 2 November 2004
1. Introduction
The purpose of this paper is to present estimates of young people in poverty in the world, with particular reference to South East Asia. The paper also describes the efforts by countries in the latter region to overcome poverty among youth, both in terms of specific measures and as part of a more general strategy to reduce poverty. Reference is made to successful examples of pro poor interve ntions that help young people. However, attention is also given to the lessons that might be gained from efforts by governments and other agencies that have been less than successful. Many young people in the world experience extreme poverty but there is little published evidence to show this. This paper presents estimates of the headcount of young people in 2002 living on less than $US1 and $US2 a day. However, due to the limitations of this income-based measure of absolute poverty, I also present estimates of the number of young people in hunger, based on 1999-2001 data. Why is it important to identify young people as one group experiencing extreme poverty? Poverty in developing countries affects most residents in terms of diminished life chances. However, in working out where best to direct resources, it is important to understand who suffers more from the effects of poverty. National poverty reduction strategies, to be comprehensive, require reliable information about the prevalence of poverty among groups, such as young women or rural youth, who have been excluded from benefiting from economic growth in the past. It is a common assumption among economists that ‘a rising tide will float all boats’. In other words, that economic growth in itself reduces poverty. However, this view can be challenged as there is evidence that the relationship between economic growth and poverty reduction is not a simple or direct one. Countries that have reduced poverty as well as fostered economic growth have only done so through a concerted effort by governments and other stakeholders to direct resources to those identified as poorer than their peers. 1
1
Pernia, E, 2003, ‘Pro-poor Growth: what is it and how is it important? ERD Policy Brief No. 17, Economic Research Department, Asian Development Bank, Manila
Young people in extreme poverty – 2004
From the perspective of national public policy, this paper outlines the best ways to identify young people in poverty. Having access to reliable data also makes it much easier for young people themselves to participate in formulating or refining national poverty reduction strategies.
2. Defining terms
Young people The term youth has different meanings depending on the context. Official documents use the word to refer to both male and female young people. In other contexts, however, the word youth can refer to young males only. The word youth can also suggest a dependent state, like the word ‘child’ or ‘children’. For these reasons, I use the term ‘young people ’ because it is a less ambiguous term. The paper focuses on the 15 to 24 age group, simply because it is a widely accepted statistical convention. However, if we use a sociological definition of young people, it is much harder to specify a set age group. In relation to a transition stage from childhood to adulthood, the age at which this transition begins will vary greatly between societies and indeed within the same society. From the perspective of a critical stage in the lifecycle, the relevant age could be as low as 10 years of age (for street kids, for example) to high as mid to late 30s. The Youth Policy Act in India, for example, defines the group it addresses as ranging from age 15 to people aged up to 35! 2 The wider age span suggests that the process of obtaining a sustaining livelihood can take a long time, particularly in poor societies. Measuring poverty Measuring poverty is fraught with numerous difficulties. These relate to defining first of all what poverty itself refers to. Is it not merely a lack of income or should it include other dimensions related to human survival such as access to good sanitation, health care and education opportunities? If poverty is defined as low income, what is the best way of measuring the income of individuals and households? If poverty is defined more broadly, what measures are appropriate to capture access to needed services? In relation to the poverty measures used, should the reference point be to some absolute level or is poverty a relative concept that needs to be related to the standard of living of the society in which the poor live. For what public policy purposes is an absolute measure of poverty more appropriate? When is a relative measure of poverty required? The Millennium Development Goals and targets in many respects resolve many of these difficulties about how poverty is measured. The goals offer a multi dimensional definition of poverty – one that encompassed not only income but also access to food, access to basic education and literacy, access to education opportunities for girls, as well as access
2
Brown, B; & Larson, R; 2002, ‘The kaleidoscope of adolescence: experiences of the World’s youth at the beginning of the 21st century’, in B Bradford Brown, Reed W Larson and TS Saraswathi, eds, The World’s Youth: Adolescence in Eight Regions of the Globe. Cambridge University Press, UK, p 5
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to health care and good sanitation in the form of good drinking water (see Box 1). The Millennium Development Goals also represent an international consensus about the importance of poverty eradication as a major objective of development.
Box 1: Extract from the Millennium Declaration relating to poverty III. Development and poverty eradication 11. We will spare no effort to free our fellow men, women and children from the abject and dehumanising conditions of extreme poverty, to which more than a billion of them are currently subjected. We are committed to making the right to development a reality for everyone and to freeing the entire human race from want… We resolve further: • To halve, by the year 2015, the proportion of the world’s people whose income is less than one dollar a day and the proportion of people who suffer from hunger and, by the same date, to halve the proportion of people who are unable to reach or to afford safe drinking water. • To ensure that, by the same date, children everywhere, boys and girls alike, will be able to complete a full course of primary schooling and that girls and boys will have equal access to all levels of education. • By the same date, to have reduced maternal mortality by three quarters, and under-five child mortality by two thirds, of their current rates. • To have, by then, halted, and begun to reverse, the spread of HIV/AIDS, the scourge of malaria and other major diseases that afflict humanity. • To provide special assistance to children orphaned by HIV/AIDS. • By 2020, to have achieved a significant improvement in the lives of at least 100 million slum dwellers as proposed in the “Cities Without Slums” initiative… Source: United Nations Millennium Declaration 55/2, 18 September, 2000
It is now widely accepted that poverty refers to more than lack of income. 3 A good example of this broader definition of poverty is provided by the Government of Mozambique in its Poverty Reduction Strategy Paper (PRSP): the ‘lack of basic human capacities, such as illiteracy, malnutrition, low life expectancy, poor maternal health, prevalence of preventable diseases, together with indirect measures such as access to the necessary goods, services and infrastructures necessary to achieve basic human capacities – sanitation, clean drinking water, education, communications, energy, etc’.4
3
Hulme, D & Shepherd, A, 2003, 'Conceptualizing Chronic Poverty' World Development Vol.31, No.3, pp.403 –423. 4 Government of the Republic of Mozambique, 2001, Action Plan for the Reduction of Absolute Poverty (2001-2005) (PARPA) p 11.
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This broader view of poverty owes much to the work of Nobel Laureate Amartya Sen who has contended that poverty is best understood as various forms of ‘unfreedom’ that prevent people from realizing and enlarging their capabilities. This broader concept of poverty views both civil and political liberties and economic and social rights as primary goals of development and the principal means of progress. 5 Dynamic view of poverty needed A broader understanding of poverty also needs to acknowledge that poverty is a dynamic phenomenon as well as static one. This means that poverty is a state that people experience which can change according to circumstances. This dynamic view of poverty is often more applicable to young people due to the obstacles most of them face in seeking to achieve adult status. A dynamic view of poverty starts from an understanding that the ‘determining condition for poor people is uncertainty’ 6 Young people’s capacities to cope with these uncertainties are shaped by a range of supports. These include the legal rights, entitlements and support systems provided by governments and employers. They also include an individual’s own personal attributes such as level of education attainment and physical health. 7 The best policy responses to dealing with this uncertainty use some form of social protection mechanism to help the poor cope with the unexpected. Young people and the Millennium Development Goals Most of the Millennium Development Goals indirectly relate to young people because they account for such a large share of the population in poor countries. Just on one in three (29 per cent) of the populations of less developed countries are aged between 10 and 24 years. 8 Over a 100 countries have a large youth bulge in their populations, with youth share in these countries ranging from 40 to 58 per cent of their total populations. 9 Young people do not appear to have a prominent place in the Millennium Development Goals as they are only mentioned in one or two places. However, on closer scrutiny, it is possible to identify five Goals as directly referring to young people because they cover activities in which mostly young people are engaged. These are the MDGs that relate to: education attainment, gender balance in education, improved maternal health, combating HIV/AIDS and other diseases such as malaria and tuberculosis and decent employment opportunities for young people (see Table 1). More investment in improving adolescent health and education levels will also have a major impact on achieving the targets for two other Millennium Development Goals.
5 6
ILO, 2003, Working out of Poverty. International Labour Conference, 91st Session, p 21. Wood, G, 2003, ‘Staying secure, staying poor: the ‘Faustian Bargain’’, World Development Vol.31,No.3,pp.455 –471. 7 Wood, G, 2003, p 455. 8 World Population Prospects: The 2002 Revision, http://www.un.org/esa/population/unpop.htm 9 Richard Cincotta, Robert Engelman, and Daniele Anastasion, 2003, The Security Demographic: Population and Civil Conflict After the Cold War, Population Action International.
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Action to improve adolescent health will reduce the incidence of high-risk pregnancies among undernourished teenagers and so this will contribute significantly to reducing child mortality – the objective of Millennium Development Goal 4. Higher education levels as well as improved nutrition for young mothers will also have a large impact on reducing hunger (Millennium Development Goal 1) by helping reduce the prevalence of underweight children under- five years of age (one of the indicators for Goal 1). Table 1: Millennium Development Goals, targets and indicators that relate to or potentially relate to young people
MDG Target Indicator
Target 1: Halve, between 1990 and 1. Proportion of population 2015, the proportion of people whose below $1 per day Goal 1: Eradicate income is less than one dollar a day extreme poverty and hunger Target 2: Halve, between 1990 and 4. Prevalence of underweight 2015, the proportion of people who children (under-five years of suffer from hunger age) Goal 2: universal education Achieve Target 3: Ensure that, by 2015, 8. Literacy rate of 15-24 year primary children everywhere, boys and girls olds alike, will be able to complete a full course of primary schooling
Target 4: Eliminate gender disparity 9. Ratio of girls to boys in Goal 3: Promote in primary and secondary education primary, secondary, and gender equality and preferably by 2005 and to all levels of tertiary education empower women education no later than 2015 10. Ratio of literate females to males of 15-24 year olds Goal 5: Improve Target 6: Reduce by three-quarters, maternal health between 1990 and 2015, the maternal 16. Maternal mortality ratio mortality ratio Goal 6: Combat Target 7: Have halted by 2015, and 18. HIV prevalence among HIV/AIDS, malaria begin to reverse, the spread of 15-24 year old pregnant and other diseases HIV/AIDS women Goal 8: Develop a Target 16: In co-operation with Global Partnership for developing countries, develop and 45. Unemployment rate of Development implement strategies for decent and 15-24 year olds productive work for youth
The prominence of young people in the MDGs is further confirmed by the specification of the targets and indicators. Young people are explicitly or implicitly the focus in
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relation to six targets (see Table 1). In terms of the performance indicators, four specifically refer to 15 to 24 year olds and two other indicators refer to activities that many young people are engaged in – secondary and tertiary education and maternity. The income poverty measure used in Millennium Development Goal 1 is based on per capita income but is not available for males and females separately. However, f ur o performance indicators refer in particular to girls and young women. The two MDGs relating to sexual and reproductive health (Goals 5 and 6) implicitly refer to young people as this age group accounts for most of the people who can potentially benefit from actions directed at achieving these two goals. In relation to Millennium Development Goal 5, young women under the age of 25 years account for many of the women who will benefit from more investment of resources to improve maternal health. Adolescent females under the age of 20, for example, account for 17 per cent of all births in the least developed countries. 10 In relation to Goal 6, ‘combating HIV/AIDS, malaria and other diseases’ and one of its targets in particular: ‘halt by 2015, and begin to reverse, the spread of HIV/AIDS’ - young people are a prime potential beneficiary as those below age 25 account for more than half of the HIV infections in developing countries. 11
3. Poverty and public policy
In a conscious effort to move away from narrow income measures of poverty, the UNDP has collected country level data on a series of social indicators. These include life expectancy at birth or under- five mortality rates, and literacy rates, access to clean water, and on equity in achievement, such as the gaps between men and women in schooling or political participation. 12 These indicators are then converted into a summary measures such as the human development index and the human poverty index for developing countries. The aim is to give policy makers overall measures by which they can assess their country’s progress in terms of human well-being rather than merely relying on income per capita as the only measure of development. A comparison of countries’ performances in terms of human development as well as economic growth shows some interesting differences. Viet Nam, for example, has roughly the same level of per capita income as Pakistan but has a much higher score on the Human Development Index (112 compared with Pakistan’s rank of 142 out 177 countries). This is due to Vietnam’s higher life expectancy and literacy. 13 Similarly, Sri Lanka ranks well in relation to the Human Development Index (ie 96 out of 177 countries) compared with its Gross Domestic Product rank of 112. 14
10
World Population Prospects: The 2002 Revision, http://www.un.org/esa/population/unpop.htm See Curtain, R, 2002, ‘Youth in Extreme Poverty: Dimensions and Country Responses’, Expert Meeting on Global Priorities for Youth, Helsinki, October 6-8. http://www.un.org/esa/socdev/unyin/helsinki/ch03_poverty_curtain.pdf 11 World Bank, nd, ‘Why address HIV/AIDS?’ Health, Nutrition and Population, Public Health www.worldbank.org 12 UNDP, Human Development Reports. Oxford University Press, New York 13 UNDP, 2004, Human Development Report 2004: Cultural liberty in today’s diverse world. Oxford University Press, New York, p 128. 14 Ibid
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The human poverty index Human poverty index is based on four indicators. These are: the probability at birth of not surviving to age 40; the adult literacy rate; deprivation in economic provisioning, as measured by sustainable access to an improved water source and the percentage of children under five underweight for age. The human poverty index ranges from a low poverty score of under 5 out of 100 for the Caribbean and Latin American countries of Barbados, Uruguay, Chile, Costa Rica and Cuba to a high score of 55 to 65 out of 100 for the sub-Saharan African countries of Ethiopia, Mali, Niger and Burkina Faso. Table 2 presents the human poverty index scores together with the GDP per capita for the major countries of the East Asia and Pacific region. The countries that have the highest poverty ratings in the region are Cambodia, Laos and Papua New Guinea. In the middle of the range are Myanmar, Viet Nam, Mongolia and Indonesia. The countries that have the lowest score on the poverty index are Thailand, China and the Philippines. A comparison of a country’s poverty index score with their per capita GDP shows some interesting trends. Thailand has a much higher per capita income than China but has the same poverty index score, suggesting that China has been more successful than Thailand in reducing its poverty as its economy has grown. Similarly, the Philippines and Indonesia have similar poverty scores to Thailand but lower per capita income levels, suggesting a better performance in the Philippines and Indonesia in relation to poverty reduction. Table 2: Major countries in East Asia and the Pacific, ranked in order of the UNDP’s Human poverty index and gross domestic product per capita Human GDP per poverty capita Country index Value (%) $US 2002 Thailand 13.1 7,010 China 13.2 4,580 Philippines 15.0 4,170 Indonesia 17.8 3,230 Mongolia 19.1 1,710 Viet Nam 20.0 2,300 Myanmar 25.4 1,027 Papua New Guinea 37.0 2,270 Lao People's Dem. Rep. 40.3 1,720 Cambodia 42.6 2,060
Source: UNDP Human Development Report 2004, Tables 1 & 3.
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A higher per capita income does not in many cases produce a lower poverty rating. Mongolia, Myanmar and Vietnam stand out in terms of their relatively low poverty ratings, given their lower capita income levels compared with other countries in the region. In contrast, Laos has the same level of per capita as Mongolia but has twice the poverty index score. Papua New Guinea with the same per capita income level as Vietnam has also nearly twice its score on the poverty index. Cambodia with a per capita income level twice that of Myanmar has a much higher poverty index rating. Need for pro poor growth strategies to reduce poverty The above analysis lends support to the view that the link between economic growth and poverty is not a simple one. The lack of a direct one-to-one relationship is demonstrated by the correlation coefficient of 0.762 between the poverty index rating of 93 countries and their per capita income for 2002. The high correlation shows that higher income levels are important for reducing poverty but that they alone do not account for the differences in poverty levels between countries. This lack of a one-to-one association applies even more so to the major countries of the East Asia and Pacific region. The correlation coefficient for the association between the per capita income level of a country and its human poverty index rating is only 0.652 for the following group of countries: Thailand, China, Philippines, Indonesia, Papua New Guinea, Viet Nam, Cambodia, Mongolia, Laos and Myanmar. The positive correlation shows that economic growth is important to reducing poverty. However, the absence of a stronger correlation shows that in the East Asia and Pacific region a country’s poverty rating is affected by other factors such as government policies as well. The above analysis shows that economic growth in many cases does not benefit the poor to the same extent as the rest of the population. The economic growth poverty nexus depends on other key inputs. This refers to the type of institutions and the specific policies governments have in place to ensure that the poor benefit greater than the population as a whole. 15 Pro growth strategies need to be distinguished from pro poor growth as it is only the latter that can achieve substantial reductions in poverty. 16 Pro poor growth strategies entail all those polices needed to promote economic growth and more. Economic policies such as economic openness, favourable investment climate, efficient financial support and appropriate labour market regulations are important. So also are pro poor growth policies such as the removal institutional discrimination against the poor in relation to people’s gender, ethnicity and religion as well as against those working in the informal sector. 17
15
Pernia, E, 2003, ‘Pro-poor Growth: what is it and how is i important? ERD Policy Brief No. 17, t Economic Research Department, Asian Development Bank, Manila. 16 Ibid 17 Ibid, p 5 See also ‘Sharpening the focus on poverty reduction’ World Bank Development Report 2005: A Better Investment Climate for Everyone. A co-publication of the World Bank and Oxford University Press, p 31-35.
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Pro poor policies are often expressed in a national poverty reduction strategy. They can encompass adequate public spending for basic education, health and family planning services, easier access to microcredit, promotion of small and medium enterprises, and infrastructure investments in rural areas. 18 The place of young people in national poverty reduction strategies is discussed below. Neglect of young people in poverty reduction strategies Many poor countries overlook the needs of young people. This is demonstrated by a review of thirty-one Poverty Reduction Strategy Papers completed to August 2003. Although an increasing number of countries are making some reference to young people in their poverty reduction strategy papers, the initiatives are often piecemeal and, hence, limited in their scale and potential impact. These country strategy papers and their action plans are produced by governments in heavily indebted countries as a requirement for debt relief. They are usually based on consultations with key stakeholders, use the best available evidence about who the poor are and analyse the main causes of poverty. The PRSP process aims to identify all groups experiencing poverty, and to highlight cross cutting issues that contribute to poverty. Although most PRSPs refer to African countries, some South Asian (Vietnam, Cambodia and Sri Lanka), Europe and Central Asia (Albania, Moldova, the Kyrgyz Republic and Tajikistan) and Latin American countries (Nicaragua, Bolivia and Honduras) are also represented. The detailed results of the content analysis of 31 completed PRSPs are reported in Attachment 1. They show that the formulators of many Poverty Reduction Strategy Papers do not appear to have consulted young people, nor are young people identified in a major way as a group experiencing poverty. However, more positively, just over half of the PRSPs give some attention to youth in their action plans. But closer scrutiny shows that only a few countries’ PRSP action plans link the strategies focused on youth to specific targets and budget outlays. 19 Moreover, there is little evidence that the situation facing yo uth are treated in the PRSPs as a major cross-cutting issue. Only 16 per cent of PRSPs view young people as a focus for integrated interventions. This arguably is the most important test of whether a PRSP addresses youth issues in a comprehensive way. Piecemeal or single program interventions are not likely to deliver the range of benefits an integrated approach can. The failure of just under a half the PRSPs to make use of feedback from young people is one likely cause of the piecemeal nature of the m of policy options adopted. The ost absence, for example, of accounts of young people experiencing poverty means that there is less likelihood of a concerted, whole-of-government effort to address their situation.
18 19
Ibid, p 5. Sundaram et al. 2003 (forthcoming) cited by Rosen, J; 2003 (forthcoming) Adolescent Health and Development: A Resource Guide for World Bank Staff and Government Counterparts. Washington, DC: World Bank.
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Why are young people overlooked in poverty assessments? One reason young people are overlooked in poverty assessments may be to do with how data on the poor are collected. Collecting data from a dynamic perspective on poverty is a more complex task than the methodology required for recording poverty from a static perspective. 20 The dynamic view of poverty requires going beyond aggregate crosssectional data to collect information over time about the same individuals or same group’s experiences of poverty. Most poverty assessments, such as those us ed in the formulation of the PRSPs, rely on household surveys to record those in poverty. Household surveys usually focus on easily enumerated households identified by a dwelling and a family. Young people in poverty are likely to be under-represented in this setting if they have left the parental home and are in precarious circumstances such as temporary accommodation or no accommodation at all. A dynamic view of poverty seeks to present information about the risk profiles for different groups of the poor by measuring vulnerabilities. However, doing this requires more than merely observing households on a once-off basis. The World Bank’s 2001 World Development Report on Attacking Poverty notes that only data collected over time can capture the basic information needed to quantify the ‘volatility and vulnerability that poor households say is so important’. One-off survey data cannot track people’s movements in and out of poverty and therefore cannot identify vulnerability - ‘the challenge is to find indicators of vulnerability that can identify at-risk households and populations beforehand.’ 21
4. The value of estimating the number of young people in extreme poverty at a national level
Why is it worthwhile presenting these estimates of young people in poverty at a more specific national level? Performance indicators are developed either consciously or unconsciously with a particular audience and political purpose in mind. It is, therefore, important to ask in relation to particular indicators what audience or audiences are being addressed. In relation to the Millennium Development Goals, one could suggest, somewhat cynically, that the target year of 2015 for the Goals is not aimed at the current generation of politicians and other policy makers as it is beyond the career lifespan of many of the politicians and civil servants who participated in the drawing up of the original declaration and made the commitment. In this sense, the direct personal responsibility of the original parties to the Millennium Declaration for making progress towards achieving the MDG targets is removed with the effluxion of time. The potency
20
The World Bank’s World Development Report on Poverty notes that: ‘Measuring vulnerability is especially difficult: since the concept is dynamic, it cannot be measured merely by observing households once. Only with household panel data—that is, household surveys that follow the same households over several years—can the basic information be gathered to capture and quantify the volatility and vulnerability that poor households say is so important. Moreover, people’s movements in and out of poverty are informative about vulnerability only after the fact. The challenge is to find indicators of vulnerability that can identify at-risk households and populations beforehand.’ , p19. 21 World Bank, 2000, Attacking Poverty. Opportunity, Empowerment, and Security. World Development Report 2000/2001. p 19.
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of the targets as spurs to action will depend on how well they are incorporated by governments into current national poverty reduction strategies and adopted by government agencies and other stakeholders such as NGOs in their immediate term action plans. Broad estimates of the numbers of young people in themselves relating to the world as a whole have some value as they serve to highlight to international agencies and donors the fact that poverty does not merely afflict children, families and old people. However, it is at the country level that the estimates of young people in extreme poverty have the greatest impact because this is the level in most instances at which public policy is formulated. A focus on young people is especially important where a national poverty reduction strategy has been or is about to be put in place. The first Millennium Development Goal (MDG) on poverty has been criticised as being ambiguous in terms of who it refers to. Does the goal of halving, by the year 2015, the proportion of the world's people whose income is less than one dollar a day apply at a global, regional or national level? 22 If the goal only applies at the global level, it is likely that the target will be met on the basis of existing trends in India and China. However, for regions such as sub-Saharan Africa, there is no possibility on existing trends that the target of halving poverty will be met. In relation to the Millennium Development Goals in general, 42 of the 47 African countries are considered ‘off track’ for at least half of the targets and 12 African countries are off track’ for all targets. 23 A regional focus for the Millennium Development Goals can highlight the needs of a group of countries with common characteristics. It can help direct attention to the need for a coordinated response on the part of international agencies and donor governments rather follow a more piecemeal country by country approach. The UK Government’s Commission for Africa is a good example of a regional focus. 24 However, it could be argued that a regional focus may take pressure away from scrutinising the performance of policy makers in individual countries. An alternative view, propounded by Jeffrey Sachs and his colleagues in the Millennium Project, is that the Millennium Development Goals need to be interpreted as country- level goals. 25 The main argument in favour of a country focus for the MDG targets is that is where the major policy decisions affecting poverty reduction are decided. The MDGs must international system inter-governmental mechanisms such as
22
be interpreted as national goals because the is based on the principle of state sovereignty, with processes – including development assistance Poverty Reduction Strategy Papers, debt relief, and
Pangestu, M & Sachs, J; coordinators, 2004, Interim Report of Task Force 1 on Poverty and Economic Development, Millennium Project, Columbia University, New York, 10 February, p 7. 23 Clemens, M; Kenny, C; & Moss, T; ‘The Trouble with the MDGs: Confronting Expectations of Aid and Development Success’ Working Paper No 40, Center for Global Development, Washington, p 2. 24 See it website at http://213.225.140.43/english.htm 25 Pangestu, M & Sachs, J; coordinators, 2004, Interim Report of Task Force 1 on Poverty and Economic Development, Millennium Project, Columbia University, New York, 10 February, p 7.
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trade negotiations – decided by countries. Likewise investment frameworks and priorities – including decisions to decentralize decisionmaking to the community level – are set nationally, so this is the level with the greatest source of traction for poverty reduction. Practically speaking, countries will only achieve the MDGs when national governments are committed to making the necessary social investments in their citizens and when they receive adequate support to do so from the international system.26 Therefore the focus of the following presentation of poverty data on young people is on individual countries. The value of data is that it offers a cross country comparison with the implied question of why are some countries doing better or worse than others. Unless information about the changing position of young people in poverty is researched and presented in national forums, policy makers have an excuse for according low priority to the needs of poor young people.
5. Head count of young people in extreme poverty
It is possible to use the MDG country level indicator of absolute income poverty to estimate a head count of the number of young people in extreme poverty in 2002. This can be done by applying the proportion of people in a country below the poverty line of one US dollar per person per day to the 15-to-24 age group to calculate the number of youth people below the poverty line. 27 Estimates of young people in poverty have been made for countries for which there are no poverty measures by matching them with the closest country with an available poverty measure. 28 Using the most recent data available up to 2002, I estimate that there are some 209 million young people living on less than $US1 a day and some 515 million young people living on less than $US 2 a day. These estimates are calculated from the data in World Bank’s Development Indicators 2004 on the proportion of people in each country below the international poverty line. This means that one in five young people in the world (19.3 per cent of of the world’s population of 1.1 billion 15 to 24 year olds are in extreme poverty. 29 On the broader measure of two dollars a day, nearly half of all young people can be categorised as living in extreme poverty (47.6 per cent of the 1.1 billion 15 to 24 year olds).
26 27
Ibid, p 7 The assumption is that young people are likely to experience poverty no less or no more than the population as a whole. 28 This method is similar to the one used by Bourguignon, F; & Morrisson, C; 2002, ‘Inequality Among World Citizens: 1820-1992’, The American Economic Review, September, pp727-744. 29 Total population figures for young people are estimates for the year 2000 and are based on the Youth Profiles Online Research Reference of the Youth Unit, Division for Social Policy and Development, United Nations, http://www.un.org/esa/socdev/unyin/wywatch/country.htm
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Table 3: Estimates of young people aged 15 to 24 years living in extreme poverty by region, millions, rank order based on living on less than $US2 a day, 2002 Regions South Asia East Asia & Pacific Sub Saharan Africa Latin American & Caribbean Europe & Central Asia Middle East & North Africa Total* Young people aged 15 to 24 years Under $US1 a day Under $2 a day 84.1m 206.1m 46.5m 150.5m 60.7m 102.1m 11.1m 27.2m 4.1m 18.2m 2.0m 12.1m 208.6m 515.1m
Source: World Development Indicators 2004, UN youth 2000population estimates * The total does not reflect exactly the sum total of the regions due to rounding.
Table 4: Estimates of young people aged 15 to 24 years living in extreme poverty in major countries in East Asia and the Pacific, millions, rank order based on living on less than $US2 a day, 2002 Global East Asia & the Pacific Pop 15 to 24 Pop 15 to 24 rank years on less years on less order than $US1 a than $US2 a day day 2 China 33.1m 93.3m 5 Indonesia 3.1m 22.2m 8 Vietnam 2.9m 10.4m 11 Philippines 2.4m 7.6m 12 Myanmar 2.6m 7.1m 20 Thailand 0.3m 3.8m 29 Korea, Dem. Rep. 0.7m 2.1m 32 Cambodia 0.9m 2.0m 62 Lao PDR 0.3m 0.8m 73 Papua New Guinea 0.08m 0.5m 75 Malaysia 0.09m 4.2m 83 Mongolia 0.07m 0.3m Total 46.5m 150.3m
Source: World Development Indicators 2004, UN population estimates. Countries with total populations less than 1m excluded
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The ten countries with the largest concentrations of poor young people living on less than one dollar a day are: India (67.7m), China (33.3m), Nigeria (18.6m), Bangladesh (9.9m), Democratic Republic of the Congo (6.9m), Pakistan (3.8m ), Sudan (3.7m), Ethiopia (3.4m), Indonesia (3.1m) and Vietnam (2.9m). The list of countries with the largest concentration of young people living less than two dollars a day is the same with one exception - Brazil enters the list at tenth place replacing Sudan. The rank order of countries also changes with Indonesia taking fifth place with 22.2m young people living on less than $US2 a day and Vietnam moves to eight place with 10.4m young people in the same category. It was noted above that the per capita income measure is not available by gender. However, other Millennium Development Goals show clearly that girls and young women in relation to literacy, access to primary and secondary education and access to health services are much more likely to be disadvantaged than boys and young men. 30 In relation to primary school enrolments in South Asia, for example, Pakistan has the lowest representation of girls (55 girls for every 100 boys enrolled) followed by India (77 girls per 100 boys) and Nepal (79 girls per 100 boys). However, other governments in the same region such as Bangladesh and Sri Lanka have been able to achieve much better ratios in primary schools (96 and 94 girls per 100 boys respectively). 31 Changes over time? These global estimates of young people in extreme poverty can be compared with the estimates of 238 million and 462 million young people living on less than $US1 and $US2 a day respectively I presented in the World Youth Report 2003. The latter estimates were based on the international poverty lines reported in World Bank Indicators for year 2000. On the surface, the differences between the two time periods suggest that the number of young people living on less than a dollar US a day has decreased by nearly 30 million. On the other hand, the number of young people living on less than two dollars US a dollar has increased by 53 million. However, comparing estimates of young people in poverty over time is particularly fraught with difficulties. The International Poverty line measures are extrapolations from primary data sources which are nationally representative household surveys. These surveys date from different years and many of the household surveys are not recent. Some date from as long ago as 1989 for Sierra Leone and 1990-91 for Zimbabwe. Only two household surveys took place in 2002 (Albania and Indonesia) and 10 surveys only relate to the year 2001. The survey dates for the remaining 139 countries refer to the decade of the 1990s to the year 2000. As the source data used in the World Bank Indicators are unlikely to change over a short time period for many countries, a
30
Curtain, R, 2004, ‘The Case for Investing in Young People as part of a National Poverty Reduction Strategy' Paper commissioned by the United Nations Population Fund, New York, released at the Technical Meeting on Promoting Sexual and Reproductive Health and Reproductive Rights: Reducing Poverty and Achieving the MDGs, Stockholm, 5-6 October, pp 22-32. http://www.curtainconsulting.net.au/young_developing_countries.html 31 Ibid, Table 8, p 24.
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meaningful comparison between two recent time periods is difficult, if not impossible, to make. Other limitations of this measure of absolute poverty are discussed further below. Regional differences in the headcount of the young in poverty In terms of regional distribution, South Asia accounts for most of the poorest young people (see Table 4). The South Asia region accounts for four out of the ten young people living on both less than $US1 and $US2 a day. Sub-Saharan Africa is the home of three of the 10 poorest young people, and two in 10 of those living on $US2 a day. The East Asia and the Pacific region accounts for two in ten of the poorest young people and three in 10 of those on the next level of poverty. How do the individual countries in East Asian and the Pacific fare? Table 4 presents estimates of the numbers of young people living on less than $US 1 and 2 dollars a day in the countries in this region with more than a million people in their total population. As noted above, three countries, China, Indonesia and Vietnam, rank in the top ten countries in the world in terms of the number of young people in extreme poverty. Three additional countries, the Philippines, Myanmar and Thailand are ranked in the top 20 countries in the world. Criticisms of the international poverty line of $1 and $2 a day Three criticisms have been made of the international poverty line measure used by the World Bank. One is the failure to take into account the purchasing power differences between countries. 32 It is argued that international exchanges tend to underestimate the purchasing power of local currencies in poor countries, especially in relation to nontraded, labour intensive good and services. 33 If these differences in purchasing power in favour of low- income countries are taken into account, the number of young people in the world in absolute poverty may be lower than the estimates presented above suggest. 34 The second criticism is that the World Bank’s poverty line is not based on the costing of the basic resource requirements of human beings. 35 The third criticism is that the poverty estimates are based on uncertain baseline data. This applies to the basis for the price comparisons as well as the extrapolations from households surveys. 36
32
Sala-i-Martin, Xavier, 2002, "The Disturbing “Rise” of Global Income Inequality." NBER Working Paper No. 8904 (April) 33 Sala -i-Martin, Xavier, 2002, and Pogge, T; & Reddy, S; 2003 (see footnote 11). 34 Wade 2001 offers a counter view: ‘Certainly, purchasing power parity measures are better for measuring relative purchasing power, or relative material welfare, though the available data are not good enough for them to be more than rough-and-ready approximations…Wade. R; 2001, Is globalisation making world income distribution more equal? LSE Development Studies Institute, London School of Economics and Political Science, Working Paper 01-01. 35 Pogge, T; & Reddy, S; 2003, ‘Unknown: the extent, distribution, and trend of global income poverty’ Institute of Social Analysis, Columbia University, New York, p 2. 36 Ibid,
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6. National poverty lines
The National poverty rate refers to the percentage of the population living below the national poverty line. National estimates are based on population-weighted subgroup estimates from household surveys. National poverty rates are often very different from the international poverty rates. These differences are due to the different resources available to national statistical agencies. They also reflect the range of methodologies used by these agencies in contrast to the standardised surveys used by the World Bank for the international poverty rate. 37 National poverty estimates also make it possible to derive sub- national estimates such as those reported in Table 5 in relation to urban and rural areas. These more disaggregated estimates are essential for targeting within-country poverty reduction efforts. Therefore a nationally derived poverty measure has much more value for national policy purposes. On the other hand, national poverty rates may be more subject to political pressure to minimise the head count. The substantial variation in the country survey dates, from 1989 to the end of the 1990s suggest that many countries are not undertaking regular surveys. This may be due to a lack of resources to support more recent surveys. However, the lack of resources may reflect a lack of political will to identify who the poor are so as to better address their needs. Table 5 also shows large rural urban differences between count ries in the prevalence of poverty, with most countries showing that rural areas are more likely to have greater numbers of poor people. However, this rural urban poverty gap may be partly a statistical artefact – the result of shifting urban boundaries where the wealthier villages near to towns are in time redefined as urban areas. 38 There is also an economic dynamic operating whereby the better off people in poor rural areas may migrate to the towns to seek better opportunities because they can afford to. Thus rural urban migration can continually lower the per capita income levels of rural areas. The overall result could well be a lowering in the overall national poverty rate at the same time that there is an increase in the rural poverty rate.
37 38
Ibid, p 17. Ibid, p 5.
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Table 5: Reported rural, urban and national poverty rates, major countries East Asia and the Pacific, various dates, per cent and Survey Rural Urban year % % Cambodia 1997 40.1 21.1 China 1998 4.6
Richard Curtain Professional Associate National Institute for Governance Curtain Consulting, Melbourne www.curtain-consulting.net.au 2 November 2004
1. Introduction
The purpose of this paper is to present estimates of young people in poverty in the world, with particular reference to South East Asia. The paper also describes the efforts by countries in the latter region to overcome poverty among youth, both in terms of specific measures and as part of a more general strategy to reduce poverty. Reference is made to successful examples of pro poor interve ntions that help young people. However, attention is also given to the lessons that might be gained from efforts by governments and other agencies that have been less than successful. Many young people in the world experience extreme poverty but there is little published evidence to show this. This paper presents estimates of the headcount of young people in 2002 living on less than $US1 and $US2 a day. However, due to the limitations of this income-based measure of absolute poverty, I also present estimates of the number of young people in hunger, based on 1999-2001 data. Why is it important to identify young people as one group experiencing extreme poverty? Poverty in developing countries affects most residents in terms of diminished life chances. However, in working out where best to direct resources, it is important to understand who suffers more from the effects of poverty. National poverty reduction strategies, to be comprehensive, require reliable information about the prevalence of poverty among groups, such as young women or rural youth, who have been excluded from benefiting from economic growth in the past. It is a common assumption among economists that ‘a rising tide will float all boats’. In other words, that economic growth in itself reduces poverty. However, this view can be challenged as there is evidence that the relationship between economic growth and poverty reduction is not a simple or direct one. Countries that have reduced poverty as well as fostered economic growth have only done so through a concerted effort by governments and other stakeholders to direct resources to those identified as poorer than their peers. 1
1
Pernia, E, 2003, ‘Pro-poor Growth: what is it and how is it important? ERD Policy Brief No. 17, Economic Research Department, Asian Development Bank, Manila
Young people in extreme poverty – 2004
From the perspective of national public policy, this paper outlines the best ways to identify young people in poverty. Having access to reliable data also makes it much easier for young people themselves to participate in formulating or refining national poverty reduction strategies.
2. Defining terms
Young people The term youth has different meanings depending on the context. Official documents use the word to refer to both male and female young people. In other contexts, however, the word youth can refer to young males only. The word youth can also suggest a dependent state, like the word ‘child’ or ‘children’. For these reasons, I use the term ‘young people ’ because it is a less ambiguous term. The paper focuses on the 15 to 24 age group, simply because it is a widely accepted statistical convention. However, if we use a sociological definition of young people, it is much harder to specify a set age group. In relation to a transition stage from childhood to adulthood, the age at which this transition begins will vary greatly between societies and indeed within the same society. From the perspective of a critical stage in the lifecycle, the relevant age could be as low as 10 years of age (for street kids, for example) to high as mid to late 30s. The Youth Policy Act in India, for example, defines the group it addresses as ranging from age 15 to people aged up to 35! 2 The wider age span suggests that the process of obtaining a sustaining livelihood can take a long time, particularly in poor societies. Measuring poverty Measuring poverty is fraught with numerous difficulties. These relate to defining first of all what poverty itself refers to. Is it not merely a lack of income or should it include other dimensions related to human survival such as access to good sanitation, health care and education opportunities? If poverty is defined as low income, what is the best way of measuring the income of individuals and households? If poverty is defined more broadly, what measures are appropriate to capture access to needed services? In relation to the poverty measures used, should the reference point be to some absolute level or is poverty a relative concept that needs to be related to the standard of living of the society in which the poor live. For what public policy purposes is an absolute measure of poverty more appropriate? When is a relative measure of poverty required? The Millennium Development Goals and targets in many respects resolve many of these difficulties about how poverty is measured. The goals offer a multi dimensional definition of poverty – one that encompassed not only income but also access to food, access to basic education and literacy, access to education opportunities for girls, as well as access
2
Brown, B; & Larson, R; 2002, ‘The kaleidoscope of adolescence: experiences of the World’s youth at the beginning of the 21st century’, in B Bradford Brown, Reed W Larson and TS Saraswathi, eds, The World’s Youth: Adolescence in Eight Regions of the Globe. Cambridge University Press, UK, p 5
2
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to health care and good sanitation in the form of good drinking water (see Box 1). The Millennium Development Goals also represent an international consensus about the importance of poverty eradication as a major objective of development.
Box 1: Extract from the Millennium Declaration relating to poverty III. Development and poverty eradication 11. We will spare no effort to free our fellow men, women and children from the abject and dehumanising conditions of extreme poverty, to which more than a billion of them are currently subjected. We are committed to making the right to development a reality for everyone and to freeing the entire human race from want… We resolve further: • To halve, by the year 2015, the proportion of the world’s people whose income is less than one dollar a day and the proportion of people who suffer from hunger and, by the same date, to halve the proportion of people who are unable to reach or to afford safe drinking water. • To ensure that, by the same date, children everywhere, boys and girls alike, will be able to complete a full course of primary schooling and that girls and boys will have equal access to all levels of education. • By the same date, to have reduced maternal mortality by three quarters, and under-five child mortality by two thirds, of their current rates. • To have, by then, halted, and begun to reverse, the spread of HIV/AIDS, the scourge of malaria and other major diseases that afflict humanity. • To provide special assistance to children orphaned by HIV/AIDS. • By 2020, to have achieved a significant improvement in the lives of at least 100 million slum dwellers as proposed in the “Cities Without Slums” initiative… Source: United Nations Millennium Declaration 55/2, 18 September, 2000
It is now widely accepted that poverty refers to more than lack of income. 3 A good example of this broader definition of poverty is provided by the Government of Mozambique in its Poverty Reduction Strategy Paper (PRSP): the ‘lack of basic human capacities, such as illiteracy, malnutrition, low life expectancy, poor maternal health, prevalence of preventable diseases, together with indirect measures such as access to the necessary goods, services and infrastructures necessary to achieve basic human capacities – sanitation, clean drinking water, education, communications, energy, etc’.4
3
Hulme, D & Shepherd, A, 2003, 'Conceptualizing Chronic Poverty' World Development Vol.31, No.3, pp.403 –423. 4 Government of the Republic of Mozambique, 2001, Action Plan for the Reduction of Absolute Poverty (2001-2005) (PARPA) p 11.
3
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This broader view of poverty owes much to the work of Nobel Laureate Amartya Sen who has contended that poverty is best understood as various forms of ‘unfreedom’ that prevent people from realizing and enlarging their capabilities. This broader concept of poverty views both civil and political liberties and economic and social rights as primary goals of development and the principal means of progress. 5 Dynamic view of poverty needed A broader understanding of poverty also needs to acknowledge that poverty is a dynamic phenomenon as well as static one. This means that poverty is a state that people experience which can change according to circumstances. This dynamic view of poverty is often more applicable to young people due to the obstacles most of them face in seeking to achieve adult status. A dynamic view of poverty starts from an understanding that the ‘determining condition for poor people is uncertainty’ 6 Young people’s capacities to cope with these uncertainties are shaped by a range of supports. These include the legal rights, entitlements and support systems provided by governments and employers. They also include an individual’s own personal attributes such as level of education attainment and physical health. 7 The best policy responses to dealing with this uncertainty use some form of social protection mechanism to help the poor cope with the unexpected. Young people and the Millennium Development Goals Most of the Millennium Development Goals indirectly relate to young people because they account for such a large share of the population in poor countries. Just on one in three (29 per cent) of the populations of less developed countries are aged between 10 and 24 years. 8 Over a 100 countries have a large youth bulge in their populations, with youth share in these countries ranging from 40 to 58 per cent of their total populations. 9 Young people do not appear to have a prominent place in the Millennium Development Goals as they are only mentioned in one or two places. However, on closer scrutiny, it is possible to identify five Goals as directly referring to young people because they cover activities in which mostly young people are engaged. These are the MDGs that relate to: education attainment, gender balance in education, improved maternal health, combating HIV/AIDS and other diseases such as malaria and tuberculosis and decent employment opportunities for young people (see Table 1). More investment in improving adolescent health and education levels will also have a major impact on achieving the targets for two other Millennium Development Goals.
5 6
ILO, 2003, Working out of Poverty. International Labour Conference, 91st Session, p 21. Wood, G, 2003, ‘Staying secure, staying poor: the ‘Faustian Bargain’’, World Development Vol.31,No.3,pp.455 –471. 7 Wood, G, 2003, p 455. 8 World Population Prospects: The 2002 Revision, http://www.un.org/esa/population/unpop.htm 9 Richard Cincotta, Robert Engelman, and Daniele Anastasion, 2003, The Security Demographic: Population and Civil Conflict After the Cold War, Population Action International.
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Action to improve adolescent health will reduce the incidence of high-risk pregnancies among undernourished teenagers and so this will contribute significantly to reducing child mortality – the objective of Millennium Development Goal 4. Higher education levels as well as improved nutrition for young mothers will also have a large impact on reducing hunger (Millennium Development Goal 1) by helping reduce the prevalence of underweight children under- five years of age (one of the indicators for Goal 1). Table 1: Millennium Development Goals, targets and indicators that relate to or potentially relate to young people
MDG Target Indicator
Target 1: Halve, between 1990 and 1. Proportion of population 2015, the proportion of people whose below $1 per day Goal 1: Eradicate income is less than one dollar a day extreme poverty and hunger Target 2: Halve, between 1990 and 4. Prevalence of underweight 2015, the proportion of people who children (under-five years of suffer from hunger age) Goal 2: universal education Achieve Target 3: Ensure that, by 2015, 8. Literacy rate of 15-24 year primary children everywhere, boys and girls olds alike, will be able to complete a full course of primary schooling
Target 4: Eliminate gender disparity 9. Ratio of girls to boys in Goal 3: Promote in primary and secondary education primary, secondary, and gender equality and preferably by 2005 and to all levels of tertiary education empower women education no later than 2015 10. Ratio of literate females to males of 15-24 year olds Goal 5: Improve Target 6: Reduce by three-quarters, maternal health between 1990 and 2015, the maternal 16. Maternal mortality ratio mortality ratio Goal 6: Combat Target 7: Have halted by 2015, and 18. HIV prevalence among HIV/AIDS, malaria begin to reverse, the spread of 15-24 year old pregnant and other diseases HIV/AIDS women Goal 8: Develop a Target 16: In co-operation with Global Partnership for developing countries, develop and 45. Unemployment rate of Development implement strategies for decent and 15-24 year olds productive work for youth
The prominence of young people in the MDGs is further confirmed by the specification of the targets and indicators. Young people are explicitly or implicitly the focus in
5
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relation to six targets (see Table 1). In terms of the performance indicators, four specifically refer to 15 to 24 year olds and two other indicators refer to activities that many young people are engaged in – secondary and tertiary education and maternity. The income poverty measure used in Millennium Development Goal 1 is based on per capita income but is not available for males and females separately. However, f ur o performance indicators refer in particular to girls and young women. The two MDGs relating to sexual and reproductive health (Goals 5 and 6) implicitly refer to young people as this age group accounts for most of the people who can potentially benefit from actions directed at achieving these two goals. In relation to Millennium Development Goal 5, young women under the age of 25 years account for many of the women who will benefit from more investment of resources to improve maternal health. Adolescent females under the age of 20, for example, account for 17 per cent of all births in the least developed countries. 10 In relation to Goal 6, ‘combating HIV/AIDS, malaria and other diseases’ and one of its targets in particular: ‘halt by 2015, and begin to reverse, the spread of HIV/AIDS’ - young people are a prime potential beneficiary as those below age 25 account for more than half of the HIV infections in developing countries. 11
3. Poverty and public policy
In a conscious effort to move away from narrow income measures of poverty, the UNDP has collected country level data on a series of social indicators. These include life expectancy at birth or under- five mortality rates, and literacy rates, access to clean water, and on equity in achievement, such as the gaps between men and women in schooling or political participation. 12 These indicators are then converted into a summary measures such as the human development index and the human poverty index for developing countries. The aim is to give policy makers overall measures by which they can assess their country’s progress in terms of human well-being rather than merely relying on income per capita as the only measure of development. A comparison of countries’ performances in terms of human development as well as economic growth shows some interesting differences. Viet Nam, for example, has roughly the same level of per capita income as Pakistan but has a much higher score on the Human Development Index (112 compared with Pakistan’s rank of 142 out 177 countries). This is due to Vietnam’s higher life expectancy and literacy. 13 Similarly, Sri Lanka ranks well in relation to the Human Development Index (ie 96 out of 177 countries) compared with its Gross Domestic Product rank of 112. 14
10
World Population Prospects: The 2002 Revision, http://www.un.org/esa/population/unpop.htm See Curtain, R, 2002, ‘Youth in Extreme Poverty: Dimensions and Country Responses’, Expert Meeting on Global Priorities for Youth, Helsinki, October 6-8. http://www.un.org/esa/socdev/unyin/helsinki/ch03_poverty_curtain.pdf 11 World Bank, nd, ‘Why address HIV/AIDS?’ Health, Nutrition and Population, Public Health www.worldbank.org 12 UNDP, Human Development Reports. Oxford University Press, New York 13 UNDP, 2004, Human Development Report 2004: Cultural liberty in today’s diverse world. Oxford University Press, New York, p 128. 14 Ibid
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Young people in extreme poverty – 2004
The human poverty index Human poverty index is based on four indicators. These are: the probability at birth of not surviving to age 40; the adult literacy rate; deprivation in economic provisioning, as measured by sustainable access to an improved water source and the percentage of children under five underweight for age. The human poverty index ranges from a low poverty score of under 5 out of 100 for the Caribbean and Latin American countries of Barbados, Uruguay, Chile, Costa Rica and Cuba to a high score of 55 to 65 out of 100 for the sub-Saharan African countries of Ethiopia, Mali, Niger and Burkina Faso. Table 2 presents the human poverty index scores together with the GDP per capita for the major countries of the East Asia and Pacific region. The countries that have the highest poverty ratings in the region are Cambodia, Laos and Papua New Guinea. In the middle of the range are Myanmar, Viet Nam, Mongolia and Indonesia. The countries that have the lowest score on the poverty index are Thailand, China and the Philippines. A comparison of a country’s poverty index score with their per capita GDP shows some interesting trends. Thailand has a much higher per capita income than China but has the same poverty index score, suggesting that China has been more successful than Thailand in reducing its poverty as its economy has grown. Similarly, the Philippines and Indonesia have similar poverty scores to Thailand but lower per capita income levels, suggesting a better performance in the Philippines and Indonesia in relation to poverty reduction. Table 2: Major countries in East Asia and the Pacific, ranked in order of the UNDP’s Human poverty index and gross domestic product per capita Human GDP per poverty capita Country index Value (%) $US 2002 Thailand 13.1 7,010 China 13.2 4,580 Philippines 15.0 4,170 Indonesia 17.8 3,230 Mongolia 19.1 1,710 Viet Nam 20.0 2,300 Myanmar 25.4 1,027 Papua New Guinea 37.0 2,270 Lao People's Dem. Rep. 40.3 1,720 Cambodia 42.6 2,060
Source: UNDP Human Development Report 2004, Tables 1 & 3.
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A higher per capita income does not in many cases produce a lower poverty rating. Mongolia, Myanmar and Vietnam stand out in terms of their relatively low poverty ratings, given their lower capita income levels compared with other countries in the region. In contrast, Laos has the same level of per capita as Mongolia but has twice the poverty index score. Papua New Guinea with the same per capita income level as Vietnam has also nearly twice its score on the poverty index. Cambodia with a per capita income level twice that of Myanmar has a much higher poverty index rating. Need for pro poor growth strategies to reduce poverty The above analysis lends support to the view that the link between economic growth and poverty is not a simple one. The lack of a direct one-to-one relationship is demonstrated by the correlation coefficient of 0.762 between the poverty index rating of 93 countries and their per capita income for 2002. The high correlation shows that higher income levels are important for reducing poverty but that they alone do not account for the differences in poverty levels between countries. This lack of a one-to-one association applies even more so to the major countries of the East Asia and Pacific region. The correlation coefficient for the association between the per capita income level of a country and its human poverty index rating is only 0.652 for the following group of countries: Thailand, China, Philippines, Indonesia, Papua New Guinea, Viet Nam, Cambodia, Mongolia, Laos and Myanmar. The positive correlation shows that economic growth is important to reducing poverty. However, the absence of a stronger correlation shows that in the East Asia and Pacific region a country’s poverty rating is affected by other factors such as government policies as well. The above analysis shows that economic growth in many cases does not benefit the poor to the same extent as the rest of the population. The economic growth poverty nexus depends on other key inputs. This refers to the type of institutions and the specific policies governments have in place to ensure that the poor benefit greater than the population as a whole. 15 Pro growth strategies need to be distinguished from pro poor growth as it is only the latter that can achieve substantial reductions in poverty. 16 Pro poor growth strategies entail all those polices needed to promote economic growth and more. Economic policies such as economic openness, favourable investment climate, efficient financial support and appropriate labour market regulations are important. So also are pro poor growth policies such as the removal institutional discrimination against the poor in relation to people’s gender, ethnicity and religion as well as against those working in the informal sector. 17
15
Pernia, E, 2003, ‘Pro-poor Growth: what is it and how is i important? ERD Policy Brief No. 17, t Economic Research Department, Asian Development Bank, Manila. 16 Ibid 17 Ibid, p 5 See also ‘Sharpening the focus on poverty reduction’ World Bank Development Report 2005: A Better Investment Climate for Everyone. A co-publication of the World Bank and Oxford University Press, p 31-35.
8
Young people in extreme poverty – 2004
Pro poor policies are often expressed in a national poverty reduction strategy. They can encompass adequate public spending for basic education, health and family planning services, easier access to microcredit, promotion of small and medium enterprises, and infrastructure investments in rural areas. 18 The place of young people in national poverty reduction strategies is discussed below. Neglect of young people in poverty reduction strategies Many poor countries overlook the needs of young people. This is demonstrated by a review of thirty-one Poverty Reduction Strategy Papers completed to August 2003. Although an increasing number of countries are making some reference to young people in their poverty reduction strategy papers, the initiatives are often piecemeal and, hence, limited in their scale and potential impact. These country strategy papers and their action plans are produced by governments in heavily indebted countries as a requirement for debt relief. They are usually based on consultations with key stakeholders, use the best available evidence about who the poor are and analyse the main causes of poverty. The PRSP process aims to identify all groups experiencing poverty, and to highlight cross cutting issues that contribute to poverty. Although most PRSPs refer to African countries, some South Asian (Vietnam, Cambodia and Sri Lanka), Europe and Central Asia (Albania, Moldova, the Kyrgyz Republic and Tajikistan) and Latin American countries (Nicaragua, Bolivia and Honduras) are also represented. The detailed results of the content analysis of 31 completed PRSPs are reported in Attachment 1. They show that the formulators of many Poverty Reduction Strategy Papers do not appear to have consulted young people, nor are young people identified in a major way as a group experiencing poverty. However, more positively, just over half of the PRSPs give some attention to youth in their action plans. But closer scrutiny shows that only a few countries’ PRSP action plans link the strategies focused on youth to specific targets and budget outlays. 19 Moreover, there is little evidence that the situation facing yo uth are treated in the PRSPs as a major cross-cutting issue. Only 16 per cent of PRSPs view young people as a focus for integrated interventions. This arguably is the most important test of whether a PRSP addresses youth issues in a comprehensive way. Piecemeal or single program interventions are not likely to deliver the range of benefits an integrated approach can. The failure of just under a half the PRSPs to make use of feedback from young people is one likely cause of the piecemeal nature of the m of policy options adopted. The ost absence, for example, of accounts of young people experiencing poverty means that there is less likelihood of a concerted, whole-of-government effort to address their situation.
18 19
Ibid, p 5. Sundaram et al. 2003 (forthcoming) cited by Rosen, J; 2003 (forthcoming) Adolescent Health and Development: A Resource Guide for World Bank Staff and Government Counterparts. Washington, DC: World Bank.
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Why are young people overlooked in poverty assessments? One reason young people are overlooked in poverty assessments may be to do with how data on the poor are collected. Collecting data from a dynamic perspective on poverty is a more complex task than the methodology required for recording poverty from a static perspective. 20 The dynamic view of poverty requires going beyond aggregate crosssectional data to collect information over time about the same individuals or same group’s experiences of poverty. Most poverty assessments, such as those us ed in the formulation of the PRSPs, rely on household surveys to record those in poverty. Household surveys usually focus on easily enumerated households identified by a dwelling and a family. Young people in poverty are likely to be under-represented in this setting if they have left the parental home and are in precarious circumstances such as temporary accommodation or no accommodation at all. A dynamic view of poverty seeks to present information about the risk profiles for different groups of the poor by measuring vulnerabilities. However, doing this requires more than merely observing households on a once-off basis. The World Bank’s 2001 World Development Report on Attacking Poverty notes that only data collected over time can capture the basic information needed to quantify the ‘volatility and vulnerability that poor households say is so important’. One-off survey data cannot track people’s movements in and out of poverty and therefore cannot identify vulnerability - ‘the challenge is to find indicators of vulnerability that can identify at-risk households and populations beforehand.’ 21
4. The value of estimating the number of young people in extreme poverty at a national level
Why is it worthwhile presenting these estimates of young people in poverty at a more specific national level? Performance indicators are developed either consciously or unconsciously with a particular audience and political purpose in mind. It is, therefore, important to ask in relation to particular indicators what audience or audiences are being addressed. In relation to the Millennium Development Goals, one could suggest, somewhat cynically, that the target year of 2015 for the Goals is not aimed at the current generation of politicians and other policy makers as it is beyond the career lifespan of many of the politicians and civil servants who participated in the drawing up of the original declaration and made the commitment. In this sense, the direct personal responsibility of the original parties to the Millennium Declaration for making progress towards achieving the MDG targets is removed with the effluxion of time. The potency
20
The World Bank’s World Development Report on Poverty notes that: ‘Measuring vulnerability is especially difficult: since the concept is dynamic, it cannot be measured merely by observing households once. Only with household panel data—that is, household surveys that follow the same households over several years—can the basic information be gathered to capture and quantify the volatility and vulnerability that poor households say is so important. Moreover, people’s movements in and out of poverty are informative about vulnerability only after the fact. The challenge is to find indicators of vulnerability that can identify at-risk households and populations beforehand.’ , p19. 21 World Bank, 2000, Attacking Poverty. Opportunity, Empowerment, and Security. World Development Report 2000/2001. p 19.
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Young people in extreme poverty – 2004
of the targets as spurs to action will depend on how well they are incorporated by governments into current national poverty reduction strategies and adopted by government agencies and other stakeholders such as NGOs in their immediate term action plans. Broad estimates of the numbers of young people in themselves relating to the world as a whole have some value as they serve to highlight to international agencies and donors the fact that poverty does not merely afflict children, families and old people. However, it is at the country level that the estimates of young people in extreme poverty have the greatest impact because this is the level in most instances at which public policy is formulated. A focus on young people is especially important where a national poverty reduction strategy has been or is about to be put in place. The first Millennium Development Goal (MDG) on poverty has been criticised as being ambiguous in terms of who it refers to. Does the goal of halving, by the year 2015, the proportion of the world's people whose income is less than one dollar a day apply at a global, regional or national level? 22 If the goal only applies at the global level, it is likely that the target will be met on the basis of existing trends in India and China. However, for regions such as sub-Saharan Africa, there is no possibility on existing trends that the target of halving poverty will be met. In relation to the Millennium Development Goals in general, 42 of the 47 African countries are considered ‘off track’ for at least half of the targets and 12 African countries are off track’ for all targets. 23 A regional focus for the Millennium Development Goals can highlight the needs of a group of countries with common characteristics. It can help direct attention to the need for a coordinated response on the part of international agencies and donor governments rather follow a more piecemeal country by country approach. The UK Government’s Commission for Africa is a good example of a regional focus. 24 However, it could be argued that a regional focus may take pressure away from scrutinising the performance of policy makers in individual countries. An alternative view, propounded by Jeffrey Sachs and his colleagues in the Millennium Project, is that the Millennium Development Goals need to be interpreted as country- level goals. 25 The main argument in favour of a country focus for the MDG targets is that is where the major policy decisions affecting poverty reduction are decided. The MDGs must international system inter-governmental mechanisms such as
22
be interpreted as national goals because the is based on the principle of state sovereignty, with processes – including development assistance Poverty Reduction Strategy Papers, debt relief, and
Pangestu, M & Sachs, J; coordinators, 2004, Interim Report of Task Force 1 on Poverty and Economic Development, Millennium Project, Columbia University, New York, 10 February, p 7. 23 Clemens, M; Kenny, C; & Moss, T; ‘The Trouble with the MDGs: Confronting Expectations of Aid and Development Success’ Working Paper No 40, Center for Global Development, Washington, p 2. 24 See it website at http://213.225.140.43/english.htm 25 Pangestu, M & Sachs, J; coordinators, 2004, Interim Report of Task Force 1 on Poverty and Economic Development, Millennium Project, Columbia University, New York, 10 February, p 7.
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Young people in extreme poverty – 2004
trade negotiations – decided by countries. Likewise investment frameworks and priorities – including decisions to decentralize decisionmaking to the community level – are set nationally, so this is the level with the greatest source of traction for poverty reduction. Practically speaking, countries will only achieve the MDGs when national governments are committed to making the necessary social investments in their citizens and when they receive adequate support to do so from the international system.26 Therefore the focus of the following presentation of poverty data on young people is on individual countries. The value of data is that it offers a cross country comparison with the implied question of why are some countries doing better or worse than others. Unless information about the changing position of young people in poverty is researched and presented in national forums, policy makers have an excuse for according low priority to the needs of poor young people.
5. Head count of young people in extreme poverty
It is possible to use the MDG country level indicator of absolute income poverty to estimate a head count of the number of young people in extreme poverty in 2002. This can be done by applying the proportion of people in a country below the poverty line of one US dollar per person per day to the 15-to-24 age group to calculate the number of youth people below the poverty line. 27 Estimates of young people in poverty have been made for countries for which there are no poverty measures by matching them with the closest country with an available poverty measure. 28 Using the most recent data available up to 2002, I estimate that there are some 209 million young people living on less than $US1 a day and some 515 million young people living on less than $US 2 a day. These estimates are calculated from the data in World Bank’s Development Indicators 2004 on the proportion of people in each country below the international poverty line. This means that one in five young people in the world (19.3 per cent of of the world’s population of 1.1 billion 15 to 24 year olds are in extreme poverty. 29 On the broader measure of two dollars a day, nearly half of all young people can be categorised as living in extreme poverty (47.6 per cent of the 1.1 billion 15 to 24 year olds).
26 27
Ibid, p 7 The assumption is that young people are likely to experience poverty no less or no more than the population as a whole. 28 This method is similar to the one used by Bourguignon, F; & Morrisson, C; 2002, ‘Inequality Among World Citizens: 1820-1992’, The American Economic Review, September, pp727-744. 29 Total population figures for young people are estimates for the year 2000 and are based on the Youth Profiles Online Research Reference of the Youth Unit, Division for Social Policy and Development, United Nations, http://www.un.org/esa/socdev/unyin/wywatch/country.htm
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Young people in extreme poverty – 2004
Table 3: Estimates of young people aged 15 to 24 years living in extreme poverty by region, millions, rank order based on living on less than $US2 a day, 2002 Regions South Asia East Asia & Pacific Sub Saharan Africa Latin American & Caribbean Europe & Central Asia Middle East & North Africa Total* Young people aged 15 to 24 years Under $US1 a day Under $2 a day 84.1m 206.1m 46.5m 150.5m 60.7m 102.1m 11.1m 27.2m 4.1m 18.2m 2.0m 12.1m 208.6m 515.1m
Source: World Development Indicators 2004, UN youth 2000population estimates * The total does not reflect exactly the sum total of the regions due to rounding.
Table 4: Estimates of young people aged 15 to 24 years living in extreme poverty in major countries in East Asia and the Pacific, millions, rank order based on living on less than $US2 a day, 2002 Global East Asia & the Pacific Pop 15 to 24 Pop 15 to 24 rank years on less years on less order than $US1 a than $US2 a day day 2 China 33.1m 93.3m 5 Indonesia 3.1m 22.2m 8 Vietnam 2.9m 10.4m 11 Philippines 2.4m 7.6m 12 Myanmar 2.6m 7.1m 20 Thailand 0.3m 3.8m 29 Korea, Dem. Rep. 0.7m 2.1m 32 Cambodia 0.9m 2.0m 62 Lao PDR 0.3m 0.8m 73 Papua New Guinea 0.08m 0.5m 75 Malaysia 0.09m 4.2m 83 Mongolia 0.07m 0.3m Total 46.5m 150.3m
Source: World Development Indicators 2004, UN population estimates. Countries with total populations less than 1m excluded
13
Young people in extreme poverty – 2004
The ten countries with the largest concentrations of poor young people living on less than one dollar a day are: India (67.7m), China (33.3m), Nigeria (18.6m), Bangladesh (9.9m), Democratic Republic of the Congo (6.9m), Pakistan (3.8m ), Sudan (3.7m), Ethiopia (3.4m), Indonesia (3.1m) and Vietnam (2.9m). The list of countries with the largest concentration of young people living less than two dollars a day is the same with one exception - Brazil enters the list at tenth place replacing Sudan. The rank order of countries also changes with Indonesia taking fifth place with 22.2m young people living on less than $US2 a day and Vietnam moves to eight place with 10.4m young people in the same category. It was noted above that the per capita income measure is not available by gender. However, other Millennium Development Goals show clearly that girls and young women in relation to literacy, access to primary and secondary education and access to health services are much more likely to be disadvantaged than boys and young men. 30 In relation to primary school enrolments in South Asia, for example, Pakistan has the lowest representation of girls (55 girls for every 100 boys enrolled) followed by India (77 girls per 100 boys) and Nepal (79 girls per 100 boys). However, other governments in the same region such as Bangladesh and Sri Lanka have been able to achieve much better ratios in primary schools (96 and 94 girls per 100 boys respectively). 31 Changes over time? These global estimates of young people in extreme poverty can be compared with the estimates of 238 million and 462 million young people living on less than $US1 and $US2 a day respectively I presented in the World Youth Report 2003. The latter estimates were based on the international poverty lines reported in World Bank Indicators for year 2000. On the surface, the differences between the two time periods suggest that the number of young people living on less than a dollar US a day has decreased by nearly 30 million. On the other hand, the number of young people living on less than two dollars US a dollar has increased by 53 million. However, comparing estimates of young people in poverty over time is particularly fraught with difficulties. The International Poverty line measures are extrapolations from primary data sources which are nationally representative household surveys. These surveys date from different years and many of the household surveys are not recent. Some date from as long ago as 1989 for Sierra Leone and 1990-91 for Zimbabwe. Only two household surveys took place in 2002 (Albania and Indonesia) and 10 surveys only relate to the year 2001. The survey dates for the remaining 139 countries refer to the decade of the 1990s to the year 2000. As the source data used in the World Bank Indicators are unlikely to change over a short time period for many countries, a
30
Curtain, R, 2004, ‘The Case for Investing in Young People as part of a National Poverty Reduction Strategy' Paper commissioned by the United Nations Population Fund, New York, released at the Technical Meeting on Promoting Sexual and Reproductive Health and Reproductive Rights: Reducing Poverty and Achieving the MDGs, Stockholm, 5-6 October, pp 22-32. http://www.curtainconsulting.net.au/young_developing_countries.html 31 Ibid, Table 8, p 24.
14
Young people in extreme poverty – 2004
meaningful comparison between two recent time periods is difficult, if not impossible, to make. Other limitations of this measure of absolute poverty are discussed further below. Regional differences in the headcount of the young in poverty In terms of regional distribution, South Asia accounts for most of the poorest young people (see Table 4). The South Asia region accounts for four out of the ten young people living on both less than $US1 and $US2 a day. Sub-Saharan Africa is the home of three of the 10 poorest young people, and two in 10 of those living on $US2 a day. The East Asia and the Pacific region accounts for two in ten of the poorest young people and three in 10 of those on the next level of poverty. How do the individual countries in East Asian and the Pacific fare? Table 4 presents estimates of the numbers of young people living on less than $US 1 and 2 dollars a day in the countries in this region with more than a million people in their total population. As noted above, three countries, China, Indonesia and Vietnam, rank in the top ten countries in the world in terms of the number of young people in extreme poverty. Three additional countries, the Philippines, Myanmar and Thailand are ranked in the top 20 countries in the world. Criticisms of the international poverty line of $1 and $2 a day Three criticisms have been made of the international poverty line measure used by the World Bank. One is the failure to take into account the purchasing power differences between countries. 32 It is argued that international exchanges tend to underestimate the purchasing power of local currencies in poor countries, especially in relation to nontraded, labour intensive good and services. 33 If these differences in purchasing power in favour of low- income countries are taken into account, the number of young people in the world in absolute poverty may be lower than the estimates presented above suggest. 34 The second criticism is that the World Bank’s poverty line is not based on the costing of the basic resource requirements of human beings. 35 The third criticism is that the poverty estimates are based on uncertain baseline data. This applies to the basis for the price comparisons as well as the extrapolations from households surveys. 36
32
Sala-i-Martin, Xavier, 2002, "The Disturbing “Rise” of Global Income Inequality." NBER Working Paper No. 8904 (April) 33 Sala -i-Martin, Xavier, 2002, and Pogge, T; & Reddy, S; 2003 (see footnote 11). 34 Wade 2001 offers a counter view: ‘Certainly, purchasing power parity measures are better for measuring relative purchasing power, or relative material welfare, though the available data are not good enough for them to be more than rough-and-ready approximations…Wade. R; 2001, Is globalisation making world income distribution more equal? LSE Development Studies Institute, London School of Economics and Political Science, Working Paper 01-01. 35 Pogge, T; & Reddy, S; 2003, ‘Unknown: the extent, distribution, and trend of global income poverty’ Institute of Social Analysis, Columbia University, New York, p 2. 36 Ibid,
15
Young people in extreme poverty – 2004
6. National poverty lines
The National poverty rate refers to the percentage of the population living below the national poverty line. National estimates are based on population-weighted subgroup estimates from household surveys. National poverty rates are often very different from the international poverty rates. These differences are due to the different resources available to national statistical agencies. They also reflect the range of methodologies used by these agencies in contrast to the standardised surveys used by the World Bank for the international poverty rate. 37 National poverty estimates also make it possible to derive sub- national estimates such as those reported in Table 5 in relation to urban and rural areas. These more disaggregated estimates are essential for targeting within-country poverty reduction efforts. Therefore a nationally derived poverty measure has much more value for national policy purposes. On the other hand, national poverty rates may be more subject to political pressure to minimise the head count. The substantial variation in the country survey dates, from 1989 to the end of the 1990s suggest that many countries are not undertaking regular surveys. This may be due to a lack of resources to support more recent surveys. However, the lack of resources may reflect a lack of political will to identify who the poor are so as to better address their needs. Table 5 also shows large rural urban differences between count ries in the prevalence of poverty, with most countries showing that rural areas are more likely to have greater numbers of poor people. However, this rural urban poverty gap may be partly a statistical artefact – the result of shifting urban boundaries where the wealthier villages near to towns are in time redefined as urban areas. 38 There is also an economic dynamic operating whereby the better off people in poor rural areas may migrate to the towns to seek better opportunities because they can afford to. Thus rural urban migration can continually lower the per capita income levels of rural areas. The overall result could well be a lowering in the overall national poverty rate at the same time that there is an increase in the rural poverty rate.
37 38
Ibid, p 17. Ibid, p 5.
16
Young people in extreme poverty – 2004
Table 5: Reported rural, urban and national poverty rates, major countries East Asia and the Pacific, various dates, per cent and Survey Rural Urban year % % Cambodia 1997 40.1 21.1 China 1998 4.6
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