Three Myths About Global Poverty

By Bill & Melinda Gates

By almost any measure the world is better off now than ever before, in part thanks to foreign aid. By 2035, they predict there will be almost no poor countries.

So why do so many people seem to think things are getting worse?

Much of the reason is that all too many people are in the grip of three deeply damaging myths about global poverty and development.

Don't get taken in by them.

MYTH ONE: Poor countries are doomed to stay poor.

They're really not. Incomes and other measures of human welfare are rising almost everywhere - including Africa.

Take Mexico City, for instance. In 1987, when we first visited, most homes lacked running water, and we often saw people trekking on foot to fill up water jugs. It reminded us of rural Africa. The guy who ran Microsoft's Mexico City office would send his kids back to the US for check-ups to make sure the smog wasn't making them sick.

Today, Mexico City is mind-blowingly different, boasting high-rise buildings, cleaner air, new roads and modern bridges. You still find pockets of poverty, but when we visit now, we think, "Wow - most people here are middle-class. What a miracle". You can see a similar transformation in Nairobi, New Delhi, Shanghai and many more cities around the world.

In our lifetime, the global picture of poverty has been completely redrawn. Per-person incomes in Turkey and Chile are where the US was in 1960. Malaysia is nearly there. So is Gabon. Since 1960, China's real income per person has gone up eightfold. India's has quadrupled, Brazil's has almost quintupled, and tiny Botswana, with shrewd management of its mineral resources, has seen a 30-fold increase. A new class of middle-income nations that barely existed 50 years ago now includes more than half the world's population.

This holds true even in Africa. Income per person in Africa has climbed by two-thirds since 1998 from just over $1300 to nearly $2200 today. Seven of the 10 fastest-growing economies of the past half-decade are in Africa.

Here's our prediction: by 2035, there will be almost no poor countries left in the world. A few unhappy countries will be held back by war, political realities (such as North Korea) or geography (such as landlocked states in central Africa). But every country in South America, Asia and Central America (except perhaps Haiti) and most in coastal Africa will have become middle-income nations. More than 70 per cent of countries will have a higher per-person income than China does today.

MYTH TWO: Foreign aid is a big waste.

Actually, it is a phenomenal investment. Foreign aid doesn't just save lives; it also lays the groundwork for lasting, long-term economic progress.

Many people think that foreign aid is a large part of the budgets of rich countries. In fact, it is less than 1 per cent. (Even Norway, the most generous nation in the world, spends less than 3 per cent.)

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This is an edited text from the forthcoming annual letter of the Bill & Melinda Gates Foundation, of which the authors are co-chairs. Mr. Gates is the chairman of Microsoft. To receive the annual letter go to gatesfoundation.org.

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