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Why We Must Stay Committed to Alleviating Poverty

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A Small Investment

Why We Must Stay Committed to Alleviating Poverty

In tough economic times like we’re facing today, some people believe one way to reduce government spending is to cut development aid to poor countries.

But as I’ll point out in my report to G20 leaders, development aid doesn’t just benefit people in poor countries. It benefits us all. Just think about the economic miracles that have occurred over the last couple of decades in countries like China, Brazil, India, Indonesia, Korea, Mexico and Turkey. The people in those countries are largely responsible for the incredible progress that has occurred, and economic aid from wealthier countries played a key supporting role.

And now, these countries – having recently figured out how to reduce poverty and increase their technical capabilities – are in a unique position to work alongside other better-off nations to help the world’s poorest 2 billion people. Over time, this positive cycle of strategic aid will reduce the amount of economic assistance that will be required of wealthier countries. Even more importantly, it enables the worst-off countries to feed, educate, and employ their people, which will lead to greater economic self-sufficiency. And that, in turn, will expand global markets for trade – benefitting all countries, including the U.S.

On the other hand, if wealthier countries cut their contributions to development, people in poor countries will continue to suffer and their economies won’t grow. The world hardly needs more suffering. And poverty does nothing to improve economic and political stability around the world.

The U.S. spends about 1 percent of its total budget on development aid – about the same as many other wealthier countries. As I will say in my report to the G20, that amount of money isn’t causing the fiscal problems in the U.S. or Europe, and cutting back on development assistance isn’t going to solve them.

The fact is, development aid is a small investment that generates huge returns. In the past 50 years, it has played an important role in agricultural advances that have saved a billion people from starvation. Innovations in the development and distribution of vaccines, and health advances, has reduced the number of children under the age of 5 who die each year – from 20 million to fewer than 8 million. This is even more amazing when you consider that the world population has more than doubled in that time.

The G20 countries have a vital role to play in ensuring that development aid is prioritized where it can make the biggest impact, and ensuring that it is used wisely. I believe there are innovative approaches and partnerships that could help accomplish this.

A half-century ago, roughly two-thirds of the world’s population was living in poverty. Today, those numbers have been reversed, due in large part to development aid provided by the U.S. and other wealthy nations. This is great progress, but there is still more we can do to improve basic living conditions for the world’s poorest 2 billion people.

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