Tanzania ranked high in bridging wealth gap

Published by Daily News
On 4 October 2016 saa 02:35
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Tanzania has been singled out as one of countries in the World that have managed to reduce economic inequality significantly over recent years.

A new World Bank study on poverty and shared prosperity, which was released on Sunday revealed that Tanzania along with Brazil, Cambodia, Mali and Peru were in the list of countries that have recorded good performance in reducing inequality.

The WB researchers identified six high-impact strategies behind the success in reducing inequality as policies with a proven track record of building poor people’s earnings, improving their access to essential services and improving their longterm development prospects, without damaging growth.

“These policies work best when paired with strong growth, good macroeconomic management and well-functioning labor markets that create jobs and enable the poorest to take advantage of those opportunities,” reads the statement.

However, the statement states that all countries must make sure inequality is seriously tackled so as to fulfill the WB targets of ending poverty by 2030. According to the statement, inequality is still far too high in many countries and that important concerns remain around the concentration of wealth among those at the top of the income distribution.

The study added that extreme poverty worldwide continues to fall despite the lethargic state of the global economy. But it warns that given projected growth trends, reducing high inequality may be a necessary component to reaching the world’s goal of ending extreme poverty by 2030.

The statement states that nearly 800 million people lived on less than 1.90/-US dollar a day in 2013. That is around 100 million fewer extremely poor people than in 2012.

“Progress on extreme poverty was driven mainly by East Asia and Pacific, especially China and Indonesia, and by India. Half of the world’s extreme poor now live in Sub-Saharan Africa, and another third live in South Asia,” reads the statement.

The report added that at least 60 out of the 83 countries covered by the new report to track shared prosperity, average incomes went up for people living in the bottom 40 percent of their countries between 2008 and 2013, despite the financial crisis.

Importantly, these countries represent 67 percent of the world’s population.The WB group President, Mr Jim Yong Kim said in a statement that apart from global economy poor performance still some countries have continued to reduce poverty and shared prosperity.

“It’s remarkable that countries have continued to reduce poverty and boost shared prosperity at a time when the global economy is underperforming, but still far too many people live with far too little,” he said.

He said in order to avoid missing WB targets for ending poverty in 2030, there is a need for changing things by resuming faster global growth and reduce inequality.

“The message is clear: to end poverty, we must make growth work for the poorest and one of the surest ways to do that is to reduce high inequality, especially in those countries where many poor people live.” he said.

On income gaps, the statement states that the new report finds that in 34 of 83 countries monitored, income gaps widened as incomes grew faster among the wealthiest 60 percent of people than among the bottom 40.

And in 23 countries, the bottom 40 saw their incomes actually decline during these years: not just relative to wealthier members of society, but in absolute terms