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Last Updated: Thursday, 26 August, 2004, 12:00 GMT 13:00 UK
Growth in Asia 'cutting poverty'
Woman collecting rubbish at the city rubbish tip in Dhaka, the capital of Bangladesh
Reform will play a large part in how quickly poverty rates drop
Asia's surging economic growth has helped to reduce levels of poverty in the region, a report has said.

The Asian Development Bank (ADB) estimated that the number of people living on less than $1 a day fell to 22% of the region's population in 2002.

That compares with 34% in 1990 and shows "considerable progress in the fight against poverty", the bank said.

The poor may be getting richer, but the gap between the haves and have nots continues to widen, the ADB said.

Quicker reform

Some areas have lagged and the ADB identified South Asia as a region where more needs to be done.

"In South Asia, neglect of public investments in physical and social infrastructure, combined with policy and institutional rigidities in agriculture, has limited growth of the rural economy," the ADB said.

"Such neglect has perpetuated age-old inequalities in the distribution of access to land, credit and social services.

The fight against poverty in Asia will be protracted
Asian Development Bank

"The end result has been that even where aggregate economic growth has been reasonable, few opportunities are created for the rural poor."

The ADB found that 93% of the extremely poor, those living on or below the $1-a-day threshold, were to be found in India, China and South Asian countries.

In India, 357 million people were living in extreme poverty, with 203 million in China and 77 million in South Asia.

Left behind

The ADB's concern is that the speed of growth seems to be widening the gap between the poor and rich, rather than narrowing it.

"One worrisome element that we are witnessing in developing Asia is that this inequality is increasing over time," Ifzal Ali, the ADB's chief economist, was reported as saying by Agence France Presse.

"Despite the fact that in developing Asia the initial levels of inequality were lower than in other parts of the world," Mr Ali told reporters in Tokyo.

The poor are still being left behind because of limited access to education, land, credit and infrastructure such as irrigation, roads and electricity, the bank said.

Steps need to be taken soon because "if the degree of inequality increases over time, the poor will benefit still less from growth," the ADB said.


Going forward, the ADB provided a number of scenarios for future poverty reduction.

In the best-case scenario, economic growth in Asia continues at the rates seen between 1999 and 2003.

Scavengers collecting rubbish after storms in Manila
Growth has not helped everyone

Extreme poverty would drop as a result, with the total number of people affected cut to 150 million by 2015, from 690 million in 2002.

South Asia, however, would still be the most poverty stricken, accounting for 140 million of the total.

The worst-case scenario provides a more sobering picture.

Growth in Asia would only have to dip by one percentage point below the 1999-2003 levels for the number of people living in extreme poverty to be 429 million by 2015.

The ADB report concludes that "policy makers must focus on generating high rates of sustainable growth while ensuring that at a minimum the distribution of income does not worsen to any significant degree".

"The fight against poverty in Asia will be protracted."

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