Fighting poverty without rapid growth: Bangladesh shows how it's done

Financial Inclusion

Fighting poverty without rapid growth: Bangladesh shows how it's done

By increasing the amount of food harvested per year, Bangladesh has been able to decrease the number of undernourished people<a href="">World Bank (flickr)</a>
By increasing the amount of food harvested per year, Bangladesh has been able to decrease the number of undernourished peopleWorld Bank (flickr)

Bangladesh is living proof that empowering and assisting the poor can sharply cut poverty even without rapid growth.

The country has made enormous strides in several arenas related to poverty alleviation. Since the 1990s life expectancy has risen from 59 to 69, which means Bangladeshis tend to live longer than their wealthier Indian counterparts. Infant mortality has decreased by more than 50 percent, with 97 deaths per thousand live births in 1990 to 37 per thousand in 2010. Access to education has increased as well, with more than 90 percent of boys and girls enrolled in primary school.

Despite these shining statistics, Bangladesh still remains one of the poorest countries in the world with a GDP per capita of only $2,053 (neighboring India’s is $3,700). Since 1971, real growth rates per Bangladeshi have only increased from two percent in the late 70’s and 80’s to five percent since 2005. Its poor are still highly dependent on agriculture as a means of income, a precarious position considering the region’s proclivity for natural disasters like cyclones and flooding.

So how did Bangladesh manage these achievements against a background of such grim circumstances? These five approaches stand out:

  • Family planning: Realizing it did not have the coercive power to enforce either a one-child policy (like China in the 1970s) or mass sterilization (as was the case with India) the Bangladeshi government made birth control free. However, it didn’t stop at removing the price tag. Government workers were dispatched all over the country to distribute birth control and dispense family planning counseling. As a result, Bangladesh's fertility rate has fallen from 6.3 births per woman in 1975 to 2.3 in 2012.
  • Increased harvests: Bangladesh managed to decrease the strain on rural households by increasing the amount of food harvested per year. Prior to increasing food productivity, families could be thrown into abject poverty as a result of crop failures or natural disasters. Its rice yield has more than tripled since the 1970s, halving the ratio of undernourished people from one in three to one in six.
  • Remittances: Approximately 6 million Bangladeshis work abroad, the majority of which send their income back home. In 2012 alone they sent back $13 billion, accounting for 14 percent of national income.
  • Public spending: 12 percent of GDP in Bangladesh is dedicated towards social programs explicitly designed to help the poorest.
  • Local nonprofits: Bangladesh is home to some of the biggest and most well-known microcredit lenders in the world, BRAC (Bangladesh Rehabilitation Assistance Committee) and Grameen Bank. BRAC has 5 million borrowers and a total loan portfolio of $775 million. Grameen has 8.4 million borrowers and $1 billion in loans. BRAC, despite its beginnings in microcredit, covers almost every category of assistance, from legal aide to health education to producing their own dairy products. The vast network of BRAC volunteers and community centers alongside a cooperative government has enabled it to reach more people.

However, Bangladesh remains an extremely impoverished country. It is still plagued by natural disasters and roiled by urbanization. Infrastructure to deal with the aftermath of cyclones and heavy flooding is still weak, endangering the livelihoods of many and threatening to dismantle the achievements of organizations such as BRAC. On top of that, the country is ill-prepared for the rapid growth of its cities.

Traditional perspectives like the Washington Consensus would have us believe that economic growth is top priority for development and poverty alleviation. Bangladesh, however, shows that growth is not always the driving factor behind decreasing poverty. Which makes you wonder: Could the methods utilized by the Bangladeshis be replicated elsewhere?

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