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"Community-Driven Development and Inclusive Growth"

Welcoming Remarks By
James Adams
Regional Vice President, East Asia and Pacific Region, The World Bank

At the International Conference on Community-Driven Development and Rural Poverty Alleviation

18 October 2009
Beijing, People’s Republic of China

(Salutations to His Excellency the Vice Minister, Mr. Fan Xiaojian, Head of the Leading Group on Poverty, our host; Mr. Greenwood, Vice President of the Asian Development Bank and Mr. David Mulroney, Ambassador to China from Canada: ………. and other top leaders in attendance¹)

Ladies and Gentlemen:

On behalf of the World Bank, let me first express my strong appreciation to all of you for attending this conference. There is much to discuss and I hope many of you also got to see something of China’s experience with Community Driven Development through the field visits to Sichuan and Shaanxi. ²

China now stands at a very important moment in its long march toward poverty reduction as it prepares its new Ten Year Poverty Reduction Strategy. I am confident that these proceedings will lead you to believe, as we in the World Bank do, that “Community Driven Development” (or CDD) and other highly participatory development approaches can help China take very important steps to construct a better, more equitable society.

Why do I believe that CDD is an important poverty reduction approach for China and the countries here gathered?

Let me first review how much China has already achieved in poverty reduction and what challenges it is likely to face in the next ten years.

Then I want to review very briefly the contributions that have been made to poverty reduction in other parts of the world by applying the CDD approach.

First, I want to recognize publicly how far China has come in its poverty alleviation efforts. China’s success in reducing extreme poverty over the last 25 years has been remarkable. The World Bank and Government estimates both show massive reductions in the number of absolute poor. The decline in poverty in China alone accounts for the global decline in poverty over that same period.

I also want to recognize the role that the Government’s Leading Group on Poverty has had in achieving this remarkable success.

Despite this tremendous success, China’s remaining poor account for the second largest concentration of extreme poor in the world-- after India-- and it has become increasingly difficult to address the needs of this group. Many of the very poor reside in remote and inaccessible regions of the western and central provinces, often in ecologically fragile environments, and they are dependent on subsistence farming. These poor are hard to reach.

The government of China’s current poverty reduction efforts, target the village level but there have been obstacles to effectively extend these efforts below to the township level.

It is therefore heartening to know that the leading group on poverty has applied, on a pilot basis, Community Driven Development approaches to complement the current interventions. In the pilots, about which we will hear much more during the conference, the villages chose to use funds for roads, small scale water resource development, health and education interventions and income generating projects. The pilots showed the same results as elsewhere in the world. That is that the CDD approach constitutes one of the most effective poverty reduction measures available. I hope that the government will scale up these CDD programs considerably in the next ten years and we at the World Bank stand ready to partner with you.

Why do I believe CDD is a worthwhile strategy in China’s efforts to tackle its remaining poverty? Let me give you some concrete examples from other parts of the world.

In South Asia, over the last ten years, some 20 CDD programs have reached 12 million households, from over 90,000 villages and helped form over 1 million grassroots community groups. The social capital of these groups has been leveraged into real financial capital. As you will hear in this conference, in the state of Andra Pradesh in India, incomes increased for close to 90% of poor rural households, including for some 8 million women; 6 million households now have access to credit; and the private financial sector is growing as the poor have become their new client base.

In Indonesia, the government decided to expand the CDD approach into a national program covering all rural and urban communities. KDP, the rural forerunner to this national program was developed ten years ago in the midst of Indonesia’s political transition and decentralization process. KDP helped to improve local governance and decentralization by pushing decision making down to the lowest level: the communities. It allowed the villagers to make their own choices about the kind of projects they need and want. The communities are empowered because the funds, planning and decision making are in their hands. Local government councils were also strengthened and accountability has improved at all levels. KDP also had an impressive evaluation program. It showed that there were marked poverty reduction gains.

One more example, this time from Africa, from Tanzania. I spent considerable time with the successful CDD programs in that country and visited many communities and districts. Believe me, it is a great pleasure to visit a community and dance with jubilant women showing off their new plow and oxen or health center where they can safely deliver their babies. In Tanzania, over 200,000 people gained increased access to education; more than a million improved their sanitation situation, over 1.4 million got improved access roads. The CDD program has become fully integrated in the decentralized local government structure. What is also very impressive is that the CDD program targets the vulnerable through a special grant window: some 400,000 orphans, widows, disabled, and elderly designed their own projects. Some 1400 sub-projects so far have received grant funding.

What I have seen world-wide, is that such programs result in communities being empowered, and holding each other and government, especially local government, accountable for results.

Overall it has also been shown that CDD helps facilitate the provision of services—particularly those for the poor—at 30-40% lower costs. The CDD approach can help governments use their resources effectively and efficiently and allocate them based on needs.

It is for these reasons that the World Bank believes that the deliberations here today and tomorrow will be an excellent cross-learning experience for all involved - representatives of the government of China, guests and resource persons from other countries, development partners personnel and civil society representatives. We hope you will come away with an enhanced understanding of the power and potential of CDD.

In conclusion, I hope that this unique international event will inspire you and allow you to learn from each other. I also hope that the government of China will use the lessons on CDD learned here, adapt them and apply them in the preparation of the next ten year poverty reduction strategy. As said before, we are very interested in collaborating with you in this endeavor.

Thank You.