The World Bank and the International Monetary Fund (IMF) were both created at the 1944 Bretton Woods Conference. The World Bank’s mandate is to lend to developing countries to fund capital programs to alleviate poverty. The IMF, an organisation of almost 200 countries, helps alleviate problems among member countries. Since the onset of the global financial crisis in 2008, the IMF has taken part in rescues of countries such as Greece.
Poverty is beating a slow but sure retreat
We all know the cliches: Is the glass half full or half empty? Is the light in the tunnel the train coming towards you? But this time, the new World Bank figures on global poverty are absolutely clear. The glass is filling up. The train is not going to crash into us. The doomsayers have been proved wrong.
Poverty is on a worldwide decrease - in Asia, the Arab world and in Latin America at a fast clip; in Africa less rapidly.
The World Bank calculates its figures on a three-year basis, but measures only up to 2008. However, preliminary evidence post-2008 suggests that the downward path in poverty has decreased even further.
Global poverty is estimated to have fallen by half between 1990 and 2010. Thus, the target of the UN's millennium development goal is met five years early.
China is the star, accounting for half of the long-term rate of decline. Since 1981, it has taken 660million people out of poverty. India, too, has had a lot of success under the reforming zeal of the government of Manmohan Singh. A report by Kotak Mahindra Bank says that in the rural areas, the growth rate per annum was 17per cent in recent years.
A quick round-up. In East Asia, 77per cent of its population lived on an income of below US$1.25 a day in 1981; in 2008, it was 14per cent. In the developing world outside China, it has fallen from 41per cent to 25per cent, in South Asia, from 61per cent to 36per cent. In sub-Saharan Africa, for the first time, fewer than half its population live under this poverty line.
Even with the economic turbulence of the last few years, poverty rates have continued to fall, thanks to the counter-cyclical, Keynesian policies practised by a majority of developing countries. But if one pushes the cut-off point up to US$2.50 a day, their progress is much less dramatic.
These overall statistics hide some highlights. According to Britain's Overseas Development Institute, four million more children are living beyond their fifth birthday than in 1990. Imagine what this means to parents. The progress has been most remarkable in Brazil, Vietnam and Bangladesh.
Aid is a big factor when it is combined with good governance, commitment, well-planned programmes and technological innovation. In sub-Saharan Africa, the countries that received the most aid made the most progress with children.
The BBC also reported recently that the millennium development goal on pure drinking water has now been reached, well ahead of its target date of 2015.
The train with the light is not going to smash into us. It may not run on time every day, but five days out of seven it does.
Jonathan Power is a syndicated foreign affairs columnist