No Goals at Half-time: What Next for the Millennium Development Goals? MDG1: Poverty and hunger Andrew Dorward and Colin Poulton

2 Outline 1. The targets 2. Data Issues 3. Achievements 4. Underlying drivers 5. Critical roles of food & agriculture in poor economies & livelihoods 6. States and markets

The MDG1 targets TARGET 1.A Halve, between 1990 and 2015, the proportion of people whose income is less than $1 a day TARGET 1.B Achieve full and productive employment and decent work for all, including women and young people TARGET 1.C Halve, between 1990 and 2015, the proportion of people who suffer from hunger 3

Methodological Issues: Poverty Conceptual difficulties with income poverty Defining the poverty line – An arbitrary line! – Depth of poverty? Counting those in poverty (data issues) – PPP effects? (+40%) – Numbers, proportions and geographical distributions: global regions, urban / rural? (urban +10%) – Consumption data or national accounts? (impact on trends) 4

Methodological Issues: Employment TARGET 1.B Achieve full and productive employment and decent work for all, including women and young people % working age in full employment – what is best? % people in low paid employment? % people in vulnerable employment? Data frequency & reliability 5

Methodological Issues: Hunger TARGET 1.C Halve, between 1990 and 2015, the proportion of people who suffer from hunger Prevalence of under weight children under 5 years (stunting, wasting) (WHO/UNICEF) Proportion of population below minimum level of dietary energy consumption (FAO) Data frequency & reliability Different definitions of hunger / food security No agreed figure for the number of hungry! 6

Achievements: Halve poverty incidence? People in extreme poverty (< $ 1.25 /day, 2005 prices) Proportion is on track 41.7% 25.7% But …. Numbers, regions, food prices, urban poverty, data (Chen & Revallion, 2008

Achievements: Halve poverty incidence? 8 People in extreme poverty (< $ 1.25 /day, 2005 prices) Proportion is on track 41.7% 25.7% But Number 1.8 billion 1.4 billion Regions SSA55.7%50.3% +100 mill South Asia48.9%38.6% + 20 mill Eastern & SE Asia56.0%15.8% LAM 9.7% 8.0% CIS 1.9% 5.4% N Africa, W Asia 3.5% 3.8% Transition SE Europe 0.1% 0.5% (UN MDG report, 2008, addendum)

9 but... required % changes in poverty rates for MDG1 (UN MDG report, 2008)

but.... food prices, urban poverty, recession, data Higher food prices may push 100 million people deeper into poverty (Ivanic and Martin 2008, UN) Global slowdown Revised urban poverty lines add 100M to global $1/day poor (mostly in South Asia & Sub-Saharan Africa) but little effect on trends. Rural poverty has been falling faster than urban poverty: rural poor fell by 148M, urban poor rose 50M (Chen & Ravallion, 2007). Poverty rates still twice as high in rural areas, 75% of $1/day poor still rural in 2002 (81% in 1993). National accounts data lower China poverty rates & gains and hence global gains (Karshenas, 2003) 10

but.... Depth of Poverty Changes in the number of Poor in the Developing World (Ahmed et al. 2007) -22%-15%-33%-16%

Achievements: full & equitable employment? 12 Proportion of employed people living below $1 (PPP) a day, 1997 and 2007 (UN MDG report, 2008)

Proportion of men and women own account & contributing family workers in total employment, 2007 Achievements: full & equitable employment? (UN MDG report, 2008)

Achievements: Halve % of hungry people? 14 Proportion of children under age five who are underweight, 1990 & 2006 (%) X X X ? Y Y Y X (UN MDG report, 2008)

Achievements: Halve % of hungry people? % of population below minimum dietary energy consumption Total numbers? Food price impacts? Rural / urban differences? (UN MDG report, 2008)

Achievements: Halve % of hungry people? IFPRI global hunger index, 2008

Underlying drivers of MDG1 changes? Growth and income distribution for consumption poverty, Growth: poverty / hunger relations? Growth explained by institutions & geography Different stages of growth and basic economic structures are critical to growth processes & constraints – changing economy & livelihood and sectoral mixes & interactions Food and agriculture are critical in poor economies 17

High potential staplesLow potential staples Broad RolePro-poor growthLeast cost welfare, growth platform Countries with Minerals Support growthSubsistence & support growth Coastal, No minerals Drive & support growthSubsistence & support growth Land locked No minerals Major driver & then supporter Subsistence Critical roles of food & agriculture in poor economies & livelihoods Importance of food in expenditures Direct importance of agriculture – income to land & labour Indirect importance of agriculture Critical for growth – factor supply & domestic demand for structural transformations out of agriculture

Importance of managing structural & policy transitions Nutrition, health & education impacts Challenges – Food prices – Energy prices – Credit crunch – Recession – Climate change – Policies & investment 19 Critical roles of food & agriculture in poor economies & livelihoods

The roles of states and markets States: institutions and/ or activism? Critical questions for Growth, Agriculture, & MDG1 (private sector goals for public organisations?) Conventional debates: public goods, market failures, state failures Historical experience: kick starting markets Institutional theory: low level traps Current questions: subsidies; state interventions in food, fertiliser and finance Challenges: crises, competing demands (interest groups, time periods), transitions, stability, probity, efficiency 20

No Goals at Half-time: What Next for the Millennium Development Goals? MDG1: Poverty and hunger Andrew Dorward and Colin Poulton

Real Commodity prices Jan 2006 to Sept 2008 Source: World Bank Pink Sheets deflated by US CPI