When I first started this job, someone told me it was a pity that I couldn't leave behind my past as a child of war. It's true that Cambodia in conflict was no holiday. But I value my early experience because it taught me firsthand the importance of helping others. This is why I was proud to see USAID respond to President Obama's challenge to help build a world without extreme poverty by putting the eradication of extreme poverty at the core of its mission statement. Nearly 1.2 billion people around the world today struggle to survive on less than $1.25 a day. Many of these "extreme poor" live in fragile environments plagued by poor governance along with insecurity and even conflict. USAID's mission is particularly relevant in Afghanistan, where we have been working over the last decade to address poverty and fragility.
Worldwide, there has been enormous success over the last 30 years in reducing extreme poverty. According to World Bank estimates, more than half the population of the developing countries lived in extreme poverty in 1981. By 2010, this share had fallen to about 20 percent. But nearly all of the improvements resulted from economic growth in countries with stronger, better functioning institutions, which in turn helped them steer clear of conflict. Reducing extreme poverty has proven more difficult for fragile states (fragility is defined by USAID as "the extent to which state-society relations fail to produce outcomes that are considered to be effective and legitimate"). Research summarized in a recent USAID paper found that fragility and armed conflict reinforce each other and perpetuate extreme poverty, that fragility impedes significant reductions in extreme poverty, and that clustered fragile states (the "neighborhood effect") can undermine poverty reduction across a region.
Afghanistan has made large gains in some respects. It showed the greatest progress among countries in the Human Development Index (HDI) between 2000 and 2013. Between the 2008 and the newly released 2012 round of Afghanistan's National Risk and Vulnerability Assessment (NRVA) household survey:
- Infant mortality decreased by 57 percent, from 111 to 48 deaths per 1000 births
Despite these improvements, income poverty has persisted in Afghanistan. In a recent Gallup poll conducted in 131 countries, more than 50 percent of surveyed households in Afghanistan reported living on less than $1.25 a day, which is less than the cost a cup of coffee in the U.S. Meanwhile, based on the national poverty line of 1,253 afghanis per person per month (about 75 cents a day), the 2012 NRVA found that poverty remained stuck at the 2008 rate of thirty-six percent. Additionally, Afghanistan has had rapid economic growth averaging nearly 10 percent over the four-year period (nine percent over the decade) but annual real per capita income, which accounts for inflation, only increased from $232 to $417. At such low levels and with a population growth rate of 2.8 percent, poverty will continue to be widespread for some time.
The NRVA shows that increased inequality appears to have been responsible for much of the recent stagnation in poverty rates: Per capita consumption among the poorest quintile grew much more slowly than average between 2008 and 2012, while consumption among the richest quintile grew much more rapidly. Part of this gap may reflect illiteracy and other obstacles that prevent the poor from taking advantage of economic opportunities. These constraints might be overcome through continued accumulation of human capital along with other steps to ensure that the pattern of future growth is more inclusive. However, the pace of future growth is uncertain. Afghanistan's recent economic recovery has benefited from long-term international assistance unparalleled in other fragile states. But with the transition to a reduced international military presence, likely reduction of future civilian assistance, and political uncertainty around the presidential elections, Afghanistan may face new fragility challenges that could make it more difficult to reduce poverty and make development progress more generally.
While the country's uncertain landscape presents new and evolving challenges, even a child (of war) can see the importance of our continued work to address poverty and fragility in Afghanistan. As such, USAID's new mission to end extreme poverty reinforces the importance of our continued partnership with Afghanistan beyond 2014. The commitments by the U.S. and other donors at the 2012 Chicago and Tokyo conferences will help to prevent increased fragility in Afghanistan by providing a gradual, as opposed to a sudden, reduction in military and civilian assistance. Also, by continuing to support critical reforms and local capacity building, USAID will help Afghanistan improve state effectiveness and legitimacy. Additionally, new efforts such as the Promoting Gender Equity in National Priority Programs (PROMOTE) and the Regional Agriculture Development projects will facilitate more sustainable and inclusive economic growth, critical to poverty reduction. None of this will be easy to undertake but it is a job well worth finishing.