World Bank report: Vietnam continues to reduce poverty
Updated : Friday, April 06, 2018 3:16 PM (GMT+0700)

Povertyin Vietnam continues to fall, particularly amongst ethnic minorities, who sawtheir rate of poverty decline significantly by 13 percentage points, thelargest decline in the past decade, says a new World Bank (WB) report.

Illustrative image - Source: VNA

According to the Report“Climbing the Ladder: Poverty Reduction and Shared Prosperity in Vietnam”released by the WB at a workshop in Hanoi on April 5, improving income fromhighland agriculture can help Vietnam further reduce poverty, which has fallenby almost 4 percentage points since 2014, to 9.8 percent in 2016.

Ethnic minorities – many ofthem living in highland areas – account for 72 percent of Vietnam’s poor, andencouraging them to grow more profitable industrial crops may improve theirearnings.

Addressing the workshop, WBCountry Director for Vietnam Ousmane Dione said Vietnam has achieved tremendousresults in reducing poverty and improving the quality of life formillions. 

The decline in povertyamongst ethnic minorities is encouraging, and more focused efforts on improvingtheir incomes can further broaden their opportunities and reduce persistentinequalities, he said.

Outlining recent trends andpatterns of poverty in Vietnam, the report proposes solutions for untappedagriculture potential in highland areas where the poor are concentrated. Landuse and cropping decisions, for example, contribute more to agriculture incomedifferences between households. Low-income families in highland areas use theirland to grow basic crops such as rice or maize instead of raising more profitablecrops such as coffee, black pepper, or rubber.

Improving access to creditmay help highland farmers make the necessary investments for higher-earningagricultural production. Strengthening earning capacity can help narrowinequalities between groups.  The average per capita consumption of ethnicminorities, for example, remains less than 45 percent of the Kinh and Hoa.Moreover, the poor faces a widening gap in terms of access to upper secondaryeducation and improved water and sanitation.

At the same time, the reportrecognizes that 70 percent of Vietnam’s population is now classified aseconomically secure, including the 13 percent who are now part of the globalmiddle-class. These income classes are growing rapidly, rising by over 20percentage points between 2010 and 2017. 

An average of 1.5 millionVietnamese joined the global middle class each year since 2014, confirming thathouseholds continue to climb the economic ladder after escaping poverty. Therise of the consumer class changes society’s aspirations and the focus of thepoverty and shared prosperity agenda shifts from combating extreme poverty toeffecting broad improvements in the quality of life and supporting the furtherexpansion of the middle class. Rapid job creation and an ongoing transition towage employment are driving gains in poverty reduction and shared prosperity.

The report suggests severalareas of strategic priorities to further reduce poverty and promote sharedprosperity, including boosting labor productivity and investing ininfrastructure to sustain job creation and wage growth without losingcompetitiveness; implementing education reforms designed to equalizeopportunities and develop workforce skills; and spurring agriculture structuraltransformation through changing farmland use patterns, strengthening land userrights, and improving skills of the poor farmers.


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