Combatting inequality key to combatting poverty, says UN Development Chief

Jan 21, 2014

London – Despite evidence that inequality prevents countries from developing in a wide number of areas, little progress has been made combatting it, said United Nations Development Programme (UNDP) Administrator Helen Clark today at the London School of Economics where she was giving a lecture at the International Growth Centre.

“Economic exclusion compounded by political exclusion can be a toxic mix – as a number of uprisings in recent years suggest. Yet little progress has been made in combatting inequality in its various forms,” Clark said.

 “Evidence suggests that income inequality impedes long-term growth; is associated with poorer health outcomes; generates political instability; contributes to higher rates of violence; erodes social cohesion; and undermines the capacity for the collective decision-making necessary for effective reform.”

Global income inequality remains high, with 8% of the world’s population earning half the world’s income, leaving 92% earning the other half.   

According to a report released yesterday by Oxfam International, the 85 richest people on Earth now have the same amount of wealth as the bottom half of the global population.

“Such a distribution is rightly viewed by global civil society networks as unacceptably high, as it is both unjust and undermines development progress,” she said.

Using the inequality-adjusted Human Development Index, which takes into account not only the average achievements of a country on health, education, and income, but also their distribution, the 2013 Human Development Report concludes that the average loss to human development worldwide due to inequality was 23%.

Clark concluded that inequality could not be addressed solely by social policies, but also needed inclusive, job-rich growth and fairer rules internationally in a range of areas from trade to finance to tackling climate change.

She suggested that the new post-2015 development goals being developed by the international community and taking into account the voices of people around the world could be instrumental in tackling inequality and development at large.

“They will set the global sustainable development agenda for the next fifteen years – years when we need decisive breakthroughs on poverty eradication in all its dimensions, on achieving greater equality, and on ensuring we live within nature’s boundaries while advancing human development.”

A new UNDP report to be launched next week examines trends and drivers of inequality and why it matters. According to the report, income inequality increased by 11% in developing countries between 1990 and 2010. A significant majority of households in developing countries—more than 75% of the population—are living today in societies where income is more unequally distributed than it was in the 1990s.

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