ウィスパリング同時通訳研究会コミュのThe Changing Face of Poverty: Can Africa Surprise the World?

The Changing Face of Poverty: Can Africa Surprise the World?

Opening remarks
Thank you all very much. It is a great pleasure to be here today and a true honor to have been invited to follow in such distinguished footsteps in giving this prestigious lecture which I have entitled, “The Changing Face of Poverty: Can Africa Surprise the World?”

Introduction
This being close to half a century since Robert McNamara’s seminal lecture which refocused the development agenda by offering a new definition of “absolute poverty,” I felt it appropriate to take this opportunity to return to this important and ever-challenging subject. Because Martin Luther King said,
“Whatever affects one directly, affects all indirectly. As long as there is poverty in this world, no man can be totally rich even if he has a billion dollars. As long as diseases are rampant and millions of people cannot expect to live more than twenty or thirty years, no man can be totally healthy, even if he just got a clean bill of health from the finest clinic in America…All this is simply to say that all life is interrelated. We are caught in an inescapable network of mutuality; tied in a single garment of destiny.”
Besides, it is really exciting and opportune to be reflecting on this subject at this time in light of Abhijit Banerjee, Esther Duflo’s and Michael Kremer’s win of the Nobel economics prize yesterday.

I know that many of you here are experts on this issue of poverty and so maybe what I say will be preaching to the choir but I do hope I can bring some fresh perspectives based on the fact that I have seen poverty from all sides and I have also seen hope and progress. I have seen poverty from my child hood in the village of Ogbe-Ofu, Ogwashi Ukwu in Delta state Nigeria, living with my grandmother till the age of 9, fetching water from a stream a couple of miles away, fetching firewood from the forest, and going with my widowed grandmother to the farm every weekend and school holidays. I have also seen poverty, hunger and malnutrition up close during my early teens from 1967-1970 when we lived through three years of the Nigeria-Biafra war. I know what it means to go hungry with one or no meals a day, seeing children dying of kwashiorkor and malaria day in, day out. As an adult with a long career at the World Bank, I have seen poverty around the globe from the small child smoking a cigarette to ward off hunger in the hills of Laos to a little girl dying from malnutrition in a rural hospital in India. And I have seen poverty from a macro and micro perspective as a two-time finance minister and minister of Foreign Affairs in my own country Nigeria. But most importantly, amidst this poverty I have also seen hope, the light and excitement in the eyes of poor girls and boys, men and women when they see the opportunity to change their lives and break out of their daily grind.
And so, I do hope that I may be able to offer some important perspectives on this subject particularly as it concerns Africa, a continent where peoples’ perception of “no hope” is often overwhelming. Picking up where Bob McNamara left off, my focus today is on the changing face of poverty globally and in Africa and what we can do about it. The numbers tell us that face is increasingly likely to be African. And rather than being that of the weather beaten and weary face of a subsistence farmer which we have long associated with poverty, today, what I see more often in my village, in the towns of Nigeria and all over Africa, is the face of an unemployed or underemployed rural or urban youth. But what I also see in that face is youthful energy and the opportunity to harness that energy productively, to create jobs and create wealth not just for that youth but also for his or her peers. But let me talk first about what you might call the “old face” of poverty and how that has changed from the seventies till now, and then turn more specifically to Africa, to examine what poverty looks like today but also what could be done about it.
The Old Face of Poverty
In 1973, Robert McNamara gave his now famous address to the Board of Governors of the World Bank in Nairobi where he coined the term “absolute poverty”, a term that has now come to define the way we measure progress and track the welfare of those at the bottom of the welfare ladder. He said,
“Despite decades of unprecedented increase in the gross national product of the developing countries, the poorest segments of their population have received relatively little benefit. Nearly 800 million individuals—40% out of a total of 2 billion survive on incomes estimated (in US purchasing power) at 30 cents per day in conditions of malnutrition, illiteracy, and squalor. They are suffering poverty in the absolute sense.”

At that time all regions—East and South Asia, Africa, Latin America were struggling with the same problems: how to grow their economies equitably, how to tackle hunger and malnutrition, increase life expectancy, improve maternal and infant mortality and increase literacy rates. The face of poverty was pretty representative of the developing world and in that sense pretty universal– it was Chinese, Indonesian, Thai, Indian, Latino, and African. It was the face of that tired rural female or male farmer and, in fact in terms of numbers, Africa represented just 10% of the absolute poor.

More than 2 decades later in 1997, Jim Wolfensohn, then President of the World Bank gave another famous speech on poverty again to the World Bank’s Board of Governors on the occasion of the annual meetings in Hong Kong. He called it “The Challenge of Inclusion.”
In the two decades since McNamara, there had been considerable progress: the proportion of people living in absolute poverty had fallen from 40 to 29%, though the numbers of those living below the then absolute poverty line of $1 a day had grown to 1.3 billion due to population growth. Life expectancy had increased from 60 to 66.8 years[1], literacy rates had improved from 77% to 85.2%[2] and maternal and under 5 mortality had improved. Maternal mortality had declined to 353 per 100,000 live births[3] and under 5 mortality had declined to 83.2 per 1,000 live births.[4] Much of that success was due to tremendous progress in East Asia especially China.

As Jim Wolfensohn put it in his speech,
“China’s success has been truly remarkable, less than a generation ago eight in ten Chinese eked out an existence by tiling the soil for less than a dollar a day. One adult in three could neither read nor write. Since then 200 mil people have been lifted out of absolute poverty, and illiteracy has fallen to less than one in ten.”

The face of poverty was changing to be less Chinese, less East Asian and more South Asian and African. But the essence of poverty was troubling. Whilst overall there was progress, some regions and some segments of the population were not progressing as fast as others and so were being left behind. It was this that Jim Wolfensohn saw as the challenge of inclusion or put the other way, the “tragedy of exclusion.”

The New Face of Poverty
Fast forward to 2019, coincidentally another two decades later, and the world has made even more progress. The proportion of people living under the absolute poverty line now $1.90 a day has fallen to less than 8% of the world’s population or 570 million people. Life expectancy has improved to 72.38 years[5] (2017), literacy rates up slightly to 86.2%[6] (2016) and maternal and under five mortality had declined to 211 per 100,000 live births[7] and 38.6 per 1,000 live births[8] But the face of poverty has shifted even more. Poor people located not just in low income but also in middle income countries are now concentrated in Africa and especially SSA. Of the 570 million people in absolute poverty, 453 million or 79% are in Africa, 35 million or 6% in South Asia, 30 million or 5% in East Asia, another 30 million or 5% in Latin America with the remaining 5% distributed to the rest of the world. In fact, projections show that at the current slow rate of poverty reduction, close to 90% of the world’s poor will be in Africa by 2030, a far cry from the zero target in the SDGs. This phenomenon is sharply illustrated by maps and charts put together by the Brookings Institution Poverty Clock project. Using today’s absolute poverty line of $1.90 a day to enable comparisons, they have calculated the headcount rate in 1973,1997 and 2019. The numbers indicate that by this measure, the world had 1.9 billion people in absolute poverty in 1973, 1.7 billion in 1997, with a dramatic fall to 570 million in 2019. You can see how the face or if you prefer “color” of poverty has shifted over the years. And behind the numbers in Africa is increasingly the face of an unemployed or underemployed young woman or man between the ages of 15-35.
So, What Happened in Africa?
Africa made some progress over the years like the rest of the world, but that progress has not been fast enough. The proportion of people in absolute poverty fell from 58% in 1997 to 41%[9] in 2019 but the absolute numbers of poor people have increased from 353 million to 453 million in the same time period due to population growth. Only a handful of countries in Africa have gone through the demographic transition so fertility rates are still very high in most countries. Literacy rates have improved from 56% in 1997 to 64.3%[10] (2016), so has life expectancy from 50 years in 1997 to 60.8 years[11] now (2017), maternal mortality has improved to 534 per 100,000 live births as of 2017[12] and under five mortality has improved to 77.5 per 1,000 live births in 2018.[13] But these rates are still far behind those of the rest of the world as we saw earlier and even farther behind what would be needed to attain the SDGs, the world’s new universal goals. For example, maternal mortality at 534 per 100,00 live births is 2.5 times the world average and almost 8 times higher than the SDG goal of less than 70 per 100,000 live births by 2030.[14] So, with respect to most indicators of welfare, Africa is not converging fast enough with the rest of the world. In the two decades since 1997 South Asia has clearly pulled away on the absolute poverty story leaving Africa, and in particular SSA at the center of this story. People are interested in what accounts for this, and this is of course an important question which I shall come back to in a moment but a more interesting question to me is, what accounts for the progress that was made, however inadequate that has been, and can it point the way out of Africa’s poverty problem?
First, on the causes of poverty, there are what I term the familiar causes. I already mentioned the issue of demography, and a delayed demographic transition on the continent. This is a very delicate subject not often discussed by policymakers, and best approached by focusing on strengthening girls’ education. With fertility rates still quite high at 4.7 births per woman[15], population growth rates are high averaging 2.68%[16] in 2019 so that per capita GDP growth rates are not high enough to lift people faster out of poverty. There is gender inequality. The lack of access by women to the services and means of production (including finance) needed to improve their lives and that of their households is a significant factor. Agricultural productivity in SSA is approximately 1/3rd that in East Asia and Latin America.[17] The abundance of natural resources, its mismanagement, and the lack of transparency and accountability it has oftentimes engendered is another factor, and above all the lack of human and physical infrastructure—access to basic health, access to education-particularly quality education and skills acquisition relevant to today’s economy and society, access to power, roads, ports and telecommunications are important.
Key as a fundamental cause of poverty is a school of thought that argues that Africa’s poverty is due to a lack of progress on industrialization and its inability to undergo the model of structural transformation experienced by the East Asian countries and China. This model was based on large scale industrialization and export-led growth, in turn premised on education, skills and a competitive labor force. In fact, Africa’s share of manufacturing as a percentage of GDP has stagnated around 10% and the share of workers employed in manufacturing has peaked below that level.[18] This phenomenon has been termed premature deindustrialization by African scholars such as Lopes and Coulibaly. According to Coulibaly, its causes could be “the role of technological innovations in making manufacturing more capital and less labor intensive, as well as the impact of “globalization and competition.” As a result, labor moves from low productivity agriculture to low productivity services by passing the industrial sector.”
Furthermore, there is mounting pessimism about the likelihood of Africa being able to replicate the East Asian model. According to Joe Stiglitz, the reason the East Asian model cannot be replicated is that “manufacturing is the victim of its own success. Developments in the sector have done so much to improve productivity in terms of output per man hour that productivity has increased faster than demand. The result is that employment in manufacturing is now declining around the world which means that it can no longer support large scale employment creation.”[19]