LATIN AMERICA:
Poverty Reduction Still Major - but Not Impossible - Challenge
Mario Osava*

RIO DE JANEIRO,  (IPS) - Latin America and the Caribbean have made significant headway towards most Millennium Development Goals (MDGs). Poverty reduction, however, still looms as a major -- yet surmountable -- challenge for some countries.

The United Nations Development Programme (UNDP) has named Brazil's publicity campaign "Eight Ways to Change the World" as one of the top five MDG initiatives, in praising its creativity in mobilising and inspiring commitment in a variety of social sectors..

The communications strategy, which the UNDP in Brazil launched in 2004, secured the participation of private enterprise, such as supermarkets, service companies and banks, as well as public sector institutions.

These partnerships helped make MDGs a main theme in Rio de Janeiro's famed carnival; millions of grocery bags and cards also sport the now-ubiquitous MDG icons.

The international community adopted the eight goals in September 2000, thereby establishing a broad development platform to combat poverty, hunger and inequality throughout the world. They specifically focus on gender, health, education, the environment and sustainable development.

In addition to the widespread marketing of products with MDG references, the campaign created National Citizenship and Solidarity Week, as well as Brazil's MDG awards, which last year recognised 23 projects and four individuals, out of 920 nominations.

Such a campaign is key, said Anna Maria Peliano, director of Social Research at the state-run Institute for Applied Economic Research (IPEA), which coordinated the 2005 national MDG progress report. This is because MDGs can be achieved only through a "large-scale national agreement" involving civil society and local, regional and national government, particularly in such a large country,

Brazil has set itself the task of not only meeting, but also surpassing the first MDG, which calls for reducing by half the number of people living in extreme poverty, defined as those living on an income of less than one dollar per day, between 1990 and 2015.

To achieve this, Brazil needs to reduce these rates to 4.4 percent -- a realistic target, given that they have dropped from 9.9 percent in 1990 to 5.7 percent in 2003, according to the IPEA MDG monitoring report. However, even supposing this is reached, close to 10 million would still be living in poverty, a number the country has proposed reducing by one quarter.

However, the initiatives are not without its critics. "The goals are minimalist, insufficient and do not address the causes of poverty and other societal ills," Fernanda Carvalho, coordinator of the Brazilian Institute of Social and Economic Analysis, told IPS.

The campaign holds society responsible for meeting the targets, instead of mobilising people to pressure governments, international organisations and rich countries to adopt or support concrete policies to eradicate poverty, said Carvalho.

The Brazilian campaign is being held up as a model for countries such as Argentina and Chile. In countries in the Andean region, on the other hand, the challenges are being defined from an economic perspective.

"Economic growth is a first requisite for poverty reduction. Peru has made progress on that front, but it is not moving as quickly as it needs to," and it also must address the challenge of "redistributing resources to narrow the gap between the rich and the poor," the UNDP representative in Peru, Jorge Chediek, told IPS.

If Peru does not improve on the seven percent annual gross domestic product growth it has been recording, it will be stuck on the slow track, with little hope of achieving the first MDG, he added.

By 2015, Peru should have reduced the population living in extreme poverty to 15.6 percent, and the proportion living in poverty to 33.1 percent. In 2004, the proportions were, respectively, 19.2 and 51.6 percent, according to the National Household Survey conducted by the National Statistics Institute (INE).

Overcoming poverty is a slow process, and in some areas, efforts are currently stalled. No significant change has been seen in Andean or Amazonian areas such as Huánuco, where 77.6 percent of residents live below the poverty line, according to the 2004 INE survey.

Chediek noted that Peru has no system to measure the extent to which state assistance has helped reduce poverty. "A better indicator would be the number of people who benefited," said the official, after pointing out other limitations, such as the "incompatibility and lack of coordination" among social programmes.

Chediek did, however, highlight the "Juntos" (Together) state-run direct-subsidy initiative introduced under former president Alejandro Toledo, which provides the poorest families with 30 dollars per month for health and education.

Pedro Francke, an economist with Peru's Pontificia Catholic University, told IPS that social programmes also present distribution problems, and funds are not always serving the public objective.

Peru needs to improve tax collection, to be able to properly channel public spending towards the poor. "Regions where mining activity has increased are just as poor as they were before, while poverty is on the rise in rural zones," said Francke.

Another stumbling block, explained Chediek, is that working conditions have deteriorated, and there has been no creation of adequate opportunities for the poor to capitalise on their economic resources, such as through effective land-titling programmes that facilitate property ownership.

"This kind of poverty is very difficult to eradicate -- it has been around for generations, and even has elements of cultural and ethnic marginalisation. The good news is that Peru has become conscious of this problem, which was evident in the last elections," said Chediek.

Specifically, at his inauguration as president Jul. 28, Alan García cited the elimination of poverty as one of his top priorities.

Efforts in some Central American countries have also yielded positive results. El Salvador boasts significant progress in terms of reducing poverty rates -- by around 20 percent -- but discrepancies in methodological criteria for measuring poverty in the country call into question the true magnitude of the achievement.

The National Office of Statistics and Census, which published the first MDG progress report (2004), calculates that 57.8 percent of the country's population survived on less than a dollar a day in 1991. The figure was reduced to 38.9 percent in 2002, or 10 percentage points away from meeting the goal of an overall poverty rate of 28.9 percent by 2015.

In terms of the percentage of people living in extreme poverty, figures taken from the 2005 Human Development Report, based on the Multipurpose Household Survey, El Salvador would be only three percentage points away from reaching its goal: by 2004 rates had been reduced to 15.2 percent, very close to the 2015 target of 12.8 percent.

These indicators raise doubts in the minds of specialists such as UNDP statistics coordinator Jimmy Vásquez. "The estimates are not accurate," he concluded.

Problems arise upon an analysis of the costs of the basic food basket and expanded market basket, which includes services such as electricity, housing, education or health. According to Vásquez, the 1996 basket is registered in the statistics as 10 percent more expensive than the current basket "and anyone who shops can plainly see this is not the case." This, he said, is how the percentage of people living in extreme poverty is being reduced in the official figures.

And to determine the total number of poor, the government uses the expanded market basket, but Vásquez believes these also yield unrealistic results, as the prices of fuel, electricity and housing have increased more than official calculations allow for.

Álvaro Trigueros, head of the macroeconomic department at the Salvadoran Foundation for Economic and Social Development, also mentioned the methodological problems inherent in measuring poverty, but emphasised that the country had made significant progress since 1991, when 25.5 percent of Salvadorans lived in conditions of extreme poverty.

In terms of implementing public policy to fully comply with the MDGs, Trigueros said the government was carrying out useful projects, such as the Solidarity Network plan, which since 2004 has distributed 15-20 dollars per month to the poorest households, to integrate needy children into the educational and health systems and relieve them of the need to seek paid work to support the family.

* Milagros Salazar (Peru) and Alberto Mendoza (El Salvador) contributed to this report.