Chhibber: Poorest countries need help to build up their resilience

17 May 2011

Last week, in Istanbul, over 40 heads of state from the world’s least developed countries gathered to define a new vision to reverse the profound poverty of the people living in these countries. Of the 48 least developed countries, 14 are in Asia.

After a period of prolonged slow growth, by 2007 these countries had accelerated their economic growth to about 7 per cent a year. Many have made notable progress on the Millennium Development Goals. Bhutan and Rwanda had halved their maternal mortality rates, while Bangladesh, Nepal and East Timor had reduced child mortality by over 60 per cent by 2007. Despite these significant gains, 50 per cent of people in least developed countries live on less than a US$1.25 a day.

These countries are particularly vulnerable to external shocks – both natural disasters and man-made crises – and they lack the resilience to bounce back.

The global recession hit them hard, and per capita gross domestic product declined in many. Now, the surge in global food prices threatens to undermine development gains. A recent Asian Development Bank study found that a 10 per cent rise in domestic food prices in developing Asia could push an additional 64 million people into extreme poverty.

The effects of climate change and other disasters add further to these challenges.

The human costs of these crises are huge. Rising sea levels are threatening the very existence of some small islands states and serious challenges are posed by the melting of Himalaya glaciers.

So far, growth in many least developed countries is driven by capital-intensive extractive sectors, and has limited impact on employment creation. Furthermore, agriculture, where the majority of the population is employed, has been growing slowly. High levels of income inequality also limit poverty reduction.

Economic growth has been a prime catalyst for eradicating poverty. But, despite higher growth, these countries are struggling to ensure inclusive growth.

The United Nations Development Programme found that some countries have been able to reduce inequalities. In Ethiopia, for example, income disparity is low mainly because of an agriculture-led development model that focuses on modernising its subsistence-level agricultural system by making efforts to improve vocational training for farmers and land management, protect rights and promote market-based initiatives.

To make sustained progress, rising climate vulnerabilities need to be tackled. Although the least developed countries contribute relatively little to global warming – accounting for less than 1 percent of the world’s total greenhouse gas emissions – they are particularly vulnerable to climate change.

Recovering from disasters can take years, and is a big drain on already scarce resources. To address climate vulnerabilities, it is critical to invest in early warning, disaster risk reduction and preparedness, and to ensure that the climate finance pledged by developed countries materialises.

Win-win approaches are those that successfully build on the synergies between the fight against both poverty and climate change.

For instance, in Nepal, the UNDP has been working with the government, the local community and the World Bank to build microhydro power plants. One such plant in the small village of Lukla in the Everest region has boosted the local economy and tourism, besides bringing significant environmental benefits.

We can expect that the impact of external shocks will become increasingly visible and destructive. Least developed countries need to step up their efforts to increase their resilience. Similarly, developed countries need to ensure that their finance pledges are honoured. Emerging economies like India and China are already stepping up to provide know-how and support to other developing countries – it is in their enlightened self-interest to ensure that the poorest countries are not left behind.

Ajay Chhibber is UN assistant secretary general and UNDP’s regional director for Asia and the Pacific.

This op-ed was originally published in the South China Morning Post.