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Battling Global Poverty

Developing countries could gain $200 billion more a year to combat poverty if industrialized nations lowered trade barriers and increased foreign aid, a senior World Bank official said Sunday.

Nicholas Stern, the bank's chief economist, said rich countries must improve in both areas if the goal of reducing by one-half the number of people living in extreme poverty is to be met by 2015.

The bank defines extreme poverty as living on less than $1 a day. Of the world's 6 billion people, 1.2 billion fall into this category.

A bank compendium of development facts, figures and analysis shows that many countries may fall short of reaching targets for poverty reduction, universal primary education and other improvements in human well-being.

"The picture emerging from these new figures is sobering but not without reason for hope," Stern said. "If developing countries, donor countries and international organizations can work together with urgency, hundreds of millions of people will then have the opportunity to escape severe deprivation."

If high income countries increased foreign aid from the current level of 0.25 percent of gross domestic product to 0.70 percent, a level most of these countries have endorsed, Stern said that $100 billion more would be available annually for developing countries.

The bank report said that in 1999, the last year for which complete figures were available, only Denmark, the Netherlands, Norway and Sweden met the 0.70 percent aid target. The figure for the United States, the world's richest economy, is 0.1 percent.

Stern said if industrialized nations reduced trade barriers to developing countries products, developing countries could gain $100 billion a year in revenue to help their economies and improve basic social services.

Among these barriers, he cited $300 million a year that industrialized countries pay their farmers in subsidies to keep prices high and shut out farm products from developing countries.

"That's an enormous amount of money to allocate to agriculture," Stern said. "If these resources went elsewhere, there would be benefits for rich and poor countries alike. But it will be a real challenge to find ways to phase out" these subsidies.

Should China and India maintain their high growth rates and carry out economic reform, the overall goal of reducing poverty can be reached worldwide, Stern said.

"But at the national level, given current rates of progress, many countries will fall short of this target," he said.

He said East Asia has moved more rapidly than other regions toward meeting poverty reduction targets while sub-Saharan Africa, which has the highest level of HIV/AIDS infections, has lagged in many areas.

Goals developed during U.N. conferences in the 1990s were endorsed last years by heads of state from 149 nations at the U.N. Millennium Summit in New York.

The goals include halving the proportion othe world's population living in extreme poverty by 2015, and progress in school enrollment, gender equality, and educating infant, child and maternal mortality.

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