Last week I read an article from the internet saying that, “Half of the world's poorest people, live in just five countries which are Nigeria, Democratic Republic of Congo, India, Ethiopia and Bangladesh”. I was so amazed to find out that only five countries host half of the world's poorest people. When I tried to find out more about these countries I learned that armed conflicts, climate change effects and the development model they chose can contribute to their poverty conditions. In our quest to eliminate poverty in these and other countries we must address these interlinked problems.
First, in countries where there is too much state ownership and control of major means of economic development, it is likely that the country will have slow economic growth. This is because in most cases state owned enterprises and enterprises where the state owns shares do not pay tax or enjoy tax heaven. In doing so these enterprises may deprive the country of income that would have been used to provide goods and services to the citizens. A friend from East Africa once told me that, his country has huge public debt such that its leaders face a choice between repaying the debt and providing services to the citizens. Under socialism and communism countries tend to borrow huge funds to run their state-owned enterprises. In the course of debt repayment citizens can view their governments as less functional because of low productivity, and inflation which sometimes triggers mass displacement, political and social unrest.
Second, climate change effects have been a stumbling block in a war against poverty. Cyclones in Bangladesh have left thousands of people without basic amenities. It is estimated that 140 Million people are expected to be internally displaced by climate change effects such as floods, tsunami, wild fire, storms and heat waves by 2050. Unless unprecedented actions are taken, this number of victims puts into question the world’s efforts of ending extreme poverty conditions by 2030. However, efforts to combat climate change have been met with socialist policies in which countries have failed to cut their state-owned industries’ emissions. Low quality technology of state acquired industries has been a champion of air and water pollutants. Furthermore countries have failed and refused to acquire clean technology in fear of increasing public debts jeopardizing the whole effort of combating climate change for poverty reduction.
Third, countries have been hit by the 2008 financial crisis which limited their economic growth. However, there has been a slow economic recovery in some countries because of socialist policies. Some countries have pushed their citizens to only purchase goods that are produced from their industries, where as in others, devaluation of their countries’ currencies has been met with huge tariffs on their products. This is destroying a reduction of trade barriers a policy advocated by international financial institutions which can help in liberating countries from poverty.
I trust the United Nation organizations can save the world from failed economic models, and other causes of poverty like climate change, and conflicts. Congratulations to the World Bank for assisting China in its transition to capitalism. Between 1980 and 2018 more than 800 million Chinese have been liberated from poverty. This clearly demonstrates the World Bank's and China's commitments to eradicating poverty. I believe our efforts to end poverty will become successful if each country ensures there is peace within and outside its borders, signs and abides to climate change agreements, privatizes state owned enterprises, encourages foreign direct investment, prevents capital flight, promotes free trade and eliminates tax holidays.