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World Bank losing poverty fight, report says

By Washington Post
Published December 8, 2006

NEW YORK - Despite an intensified campaign against poverty, World Bank programs have failed to lift incomes in many poor countries over the past decade, leaving tens of millions of people with stagnating and even declining living standards, according to a report released Thursday by the bank's autonomous assessment arm.

Among 25 poor countries probed in detail by the bank's Independent Evaluation Group, only 11 saw reductions in poverty between the mid 1990s and the early 2000s, while the other 14 suffered the same or worse rates over that term. The group said the sample was representative of the global picture.

"Achievement of sustained increases in per capita income, essential for poverty reduction, continues to elude a considerable number of countries," the report declared, singling out as particularly ineffective programs aimed at the rural poor. Roughly half of such efforts from 2001 to 2005 "did not lead to satisfactory results." During that period, new World Bank loans and credits aimed directly at rural development totaled $9.6-billion, or about one-tenth of total bank lending, according to the group.

In a statement distributed with the report, World Bank management rejected its assessment as "overly bleak," arguing that the overall trend is improving in every region of the Earth except Africa. Bank administrators noted that reducing poverty requires economic growth, something they said the world has been enjoying: Over the last two years, developing countries collectively grew by about 5 percent to 6 percent per year, excluding swiftly developing China and India.

But the evaluation group study found that growth has rarely been sustained, exposing the most vulnerable people - the rural poor - to volatile shifts in their economic fortunes.

[Last modified December 8, 2006, 01:20:40]