Fighting Poverty

The Asian Development Bank's vision is an Asia and Pacific region free from poverty. ADB is confident that this goal is achievable. Spearheading this effort is ADB's Poverty Reduction Strategy which rests on three pillars:

• pro-poor sustainable economic growth

• social development

• good governance

The Poverty Reduction Unit leads the drive. Established in 1999, the unit will provide the analytical and operational framework to guide all departments and offices concerned with implementing the Poverty Reduction Strategy, and monitor progress. Henceforth, at least 40 per cent of all ADB's public sector lending will go directly toward poverty reduction.

ADB recognizes that the main responsibility for poverty reduction lies with the governments of its developing member countries (DMCs). ADB's operations will support their efforts to fight poverty and achieve the International Development Goals - halving the proportion of people living on less than US$1 per day by 2015.

The consensus of the Asia Pacific Forum on Poverty held in Manila in early 2001, recognized that this goal is achievable, providing there are reforms in policies, programs and institutions.

ADB is now undertaking poverty analyses in each DMC to understand where the poor are, what makes and keeps them poor, and how to help them escape poverty.

It is signing Partnership Agreements with each DMC, identifying the priority, policies and project interventions that it could support. So far, three such agreements have been signed, with Bangladesh, Indonesia, and Mongolia, and it targets to complete the exercise by early 2002.

Under the partnership agreement, Bangladesh, where nearly half the 128 million population live on less than US$1 per day, the Government is committed to reducing poverty to 35 per cent by 2005 and below 25 per cent by 2010. To support these goals, ADB plans to lend up to US$500 million annually.

Of the 17 projects and programs identified for 2001-2003, six are direct poverty interventions in the agriculture and social sectors. To promote higher growth, ADB will also develop key infrastructure such as electricity, gas and transportation. Read the Bangladesh Poverty Update.

Similarly Mongolia, the first DMC to sign a Partnership Agreement, aims to halve the proportion of the country's poor by 2005. The agreement also aims to achieve universal primary education and halve the mortality rates for infants and children under five by 2005. Every ADB project in Mongolia now will have a poverty focus. ADB will also assist in agriculture reforms, which has high potential for generating employment and higher incomes in Mongolia.

In the People's Republic of China (PRC), home to a large segment of Asia's poor, about 70 per cent of ADB's US$3.5 billion lending over the next three years will be targeted at the poor provinces in central and western PRC, where most of the poor live.

For example, feeder roads to poor villages are part of ADB road projects, and rural electricity components are part of its power projects. The Chongqing-Guizhou Roads Development Project, for example, will build a 176-km expressway across mountainous terrain in the poor southwestern region. It will also upgrade 826-km feeder roads connecting the expressway interchanges to underdeveloped counties and townships. The link will give rural folk better access to markets, jobs, education and health services.

ADB also supports agriculture research to improve poor farmers' livelihoods in PRC. In Yunnan Province, bio-diversity has been used to reduce crop losses from disease and pests. This has begun to reap significant benefits for poor farmers.

Similarly, in Lao PDR, one of the poorest and least developed countries in Asia, a road upgrading project (Route 13) funded by ADB has positively affected rural people's lives. The modernization of the northern stretches of Route 13 has brought remote rural areas closer to the city of Luang Prabang, boosting rural-urban trade. Read more in the article in the ADB Review.

Although economic growth is the most powerful weapon in the fight against poverty, this alone is not sufficient and it must be "pro-poor and sustainable" to have an impact. It must be accompanied by social development such as basic education and measures to eliminate gender discrimination.

For example, through a US$45 million loan, ADB has enabled more girls in Pakistan to complete quality primary education and prepare for secondary schooling -- and eventual employment. The project helped establish community model schools in rural villages so that several thousand girls who previously lacked access to a school near home could enroll annually in grades 1 and 2. About 120,000 girls in villages who would have dropped out after grade 2 because of a shortage of classrooms in girls schools will also be able to continue schooling. Annually, about 35,000 girls who would have left school will be able to enter grade 6.

In Cambodia, a US$20 million basic skills project is striving to rebuild the country's pool of skilled workers, many of whom were killed or fled during the genocide of the late 1970s. The "livelihood training" and microcredit are boosting incomes of the poor and changing lives in three provinces - Phnom Penh, Kampong Cham and Siem Reap.

To enhance ADB's fight against poverty, the Japan Fund for Poverty Reduction was established in 2000. The Fund will provide grants in relation to ADB's loans to reduce poverty, and also support capacity-building efforts. The first project under the JFPR launched in October 2000 was to provide sexually abused street girls in Yogjakarta, Indonesia, shelter, health-care and counseling services.

The need for social protection in Asian countries is also crucial, especially to protect families who are vulnerable to income loss, ADB is currently finalizing its Social Protection Strategy to reduce risks for the most vulnerable groups, including the unemployed, women, children, the elderly, and victims of natural disasters.

Although Asia has come a long way in its journey toward economic development in the last 40 years, the continent is still home to about two thirds of the world's poor. About 900 million hungry Asians must survive on less than US$1 a day.