Poverty slide can be arrested

Poverty slide can be arrested

Covid-19 will have faded as an immediate threat in a few years. Yet its effect will last longer. Governments across the world, including Thailand, will face huge challenges in trying to finance the economic recovery programme that will be needed when countries get back on their feet.

The latest United Nations Development Programme (UNDP) report on multidimensional poverty revealed that across 109 developing countries 1.3 billion people— 21.7 percent—live in multidimensional poverty such as income loss and poor education and health care opportunities, inadequate nutrition, job

The UNDP survey, released early October, says Thailand ranks best among ASEAN countries in the poverty survey under its so-called Multidimensional Poverty Index (MPI).

The MPI survey started collected data from 109 developing nations. It treats poverty in various dimensions, rather than sticking with the traditional yardstick of income level per household. The MPI looks at poverty in 10 areas and gives scores accordingly. Apart from income, other indices are access to health care, education, good nutrition, social justice and standard of living, for instance. A lower score implies lower poverty.

The survey shows Thailand's MPI is 0.002, the lowest poverty level among the Association of Southeast Asian Nation countries. Our neighbours get higher scores which means more poverty problem: Myanmar (0.176), Cambodia (0.170), and the Lao People's Democratic Republic (0.108). Countries with a similar economic profile also scored higher : the Philippines (0.024), Vietnam (0.019), and Indonesia (0.014). Thailand's score is also lower than that of the East Asia and the Pacific (0.023) region.

Thailand’s index improved in recent years. In 2015/2016 and 2012, the index was 0.003 and 0.005 respectively.

The country’s multidimensional poverty headcount is 0.5 percentage points higher than the percentage of the population living below 2011 PPP US$1.90 per day.

The takeaway for Thai policymakers is that money might not be the only answer for reducing poverty. Deprivations in health, education and standard of living should also be addressed.

The survey raises big questions. How should the government rethink its poverty eradication policy? To be fair, Thai governments have being waging war against poverty for half a century and allocated massive budgets.

The first poverty eradication effort started in 1975 under the first popular elected civilian government of prime minister MR Kukrit Pramoj. MR Kukrit launched the first anti-poverty scheme, known as ngeun bhan, or the "diversion fund".

The fund spent 2.5 billion baht, a huge sum at that time, to hire rural residents to do public service work such as digging waterways, canals, or water catchment reservoirs; repairing public properties, and installing utility poles.

Another popular poverty alleviation policy was the "One Million Baht Village Fund" developed in 2000 under former PM Thaksin Shinawatra; this scheme is a revolving loan for villagers to use as business start-up seed money.

Both schemes might differ in the detail but share the same approach of injecting cash and creating jobs to help Thais climb above the poverty line.

PM Prayut Chan-o-cha's poverty reduction scheme is not much different. The state welfare cards launched in 2018 transferred cash to 14 million low-income people.

Cash handouts and jobs are essential for every poverty alleviation effort but the effect is not sustainable.

Over the last 30 years, Thailand's relative poverty rate declined from 65 per cent in 1988 to 9.85 per cent in 2018. Extreme poverty rates, measured by the World Bank as those living below $1.90 (60 baht) per day, are virtually zero.

But poverty has been on the rise again during last few years. It jumped from 7.2% to 9.8% between 2015 and 2018, according to World Bank's report last year. Thailand has the fourth highest wealth inequality rate in the world at 90.2%, meaning there is a huge disparity between the richest and poorest.

Needless to say, the Covid-19 pandemic will rub salt into the wound.

For years to come, governments will face a tough task in solving poverty because conditions will get worse and more complex -- compounded by an ageing society, digital disruption, and climate change that will hit the agriculture sector in particular.

Battling public debt, the government must work smarter and be more creative as it tackles the problem. The government can increase wealth by simply enforcing law and public policy to eradicate air pollution, reduce toxic residues in food, make education more equitable and decent health care accessible to all. That's a start, at least. This is the time for reshaping policies and development pathways for a fair, equitable recovery post Covid-19.


Bangkok Post editorial column

These editorials represent Bangkok Post thoughts about current issues and situations.

Email : anchaleek@bangkokpost.co.th

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