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Poverty reduction is the main goal of the World Bank, the UNDP, and most other development agencies. This strategy emphasizes getting countries out of what the World Bank calls “poverty traps”, such as low productivity, poor infrastructure, and weak public health and education systems. According to the Bank, poverty reduction policies should focus in six areas:
- social structures, such as health, nutrition, education, water, and sanitation systems;
- agricultural production, including improving technology, rural infrastructure (such as roads, irrigation, and storage facilities), and secure property rights;
- infrastructure, such as roads, ports, energy, and communications;
- government industrial policies that spur private economic activity, such as tax incentives and government-funded research and development;
- social equality, such as equal rights for women (discussed in more detail); and
- environmental sustainability (also discussed in more detail). Investments in this area, says the World Bank, would lead to an economic take-off “within a generation.”1
Significantly, the World Banks says that outside resources are not needed to start this takeoff, only to support it once its begun.
Most importantly, the World Bank states that economic policies should be oriented toward the creation of jobs in labor-intensive manufacturing industries, to produce goods for export, which, it believes, “is half the battle of achieving sustained growth.”2
But those policies, the World Bank argues, require a support system of properly valued exchange rates, financing from foreign direct investments, and a competent and cooperative public sector bureaucracy. The institution notes that while industrial development moves forward, poor populations still need other help, such as agricultural assistance, access to land, and other economic assets and legal rights.3
1 World Development Report Attacking Poverty Overview, 6.
2 United Nations Development Programme Human Development Report 2003 79.
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