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Millennium development goals global monitoring report 2007
The World Bank
Circa May 2007

http://www.ukzn.ac.za/ccs/default.asp?2,40,3,1279

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Broad-based global economic growth in 2006, and more generally since 2000, provides grounds for optimism about progress in advancing the Millennium Development Goals (MDGs). For low-income countries, real per capita income growth in Sub-Saharan Africa and South Asia has been stronger in the period since 2000 than at any time since the 1960s, and stronger than at any time since transition in Europe and Central Asian countries. Based on this strong growth performance, the estimated number of extremely poor people (living on $1 per day) fell by 135 million between 1999 and 2004.

Although still uneven, progress with poverty reduction is evident across all regions. Sub-Saharan Africa reduced the share of people living in extreme poverty by 4.7 percentage points over five years to 41 percent, although high population growth left the same absolute number of poor, at nearly 300 million. South Asia, Latin America, and East Asia all appear to be roughly on track to halve extreme poverty by 2015 from 1990 levels. Europe, Central Asia, and the Middle East and North Africa have largely eliminated extreme poverty. There are also hopeful signs that international development efforts may be gaining momentum, and new innovations in resource mobilization for development are taking shape.

Yet in spite of this optimistic outlook, the international community faces a much more demanding agenda in advancing the MDGs as 2015 draws nearer. Despite progress, nearly 1 billion people remain in extreme poverty. All regions are off track to meet the target for reducing child mortality; nutrition is a major challenge, with one-third of all children in developing countries underweight or stunted; half the people in developing countries lack access to improved sanitation.

Action to scale up development efforts needs to accelerate, but steps forward still appear tentative. Nearly seven years after the Millennium Summit and five years after the Monterrey summit, there has yet to be a country case where aid is being significantly scaled up to support a medium-term program to reach the MDGs. While there has been modest progress in Paris or Brussels or London to address the well-recognized problems in designing and delivering international aid-proliferation of aid channels, weak coordination, lack of resource predictability, misalignment with country strategies, and so on-viewed from the capitals of Ethiopia, Madagascar, or Bolivia, this progress appears to be slow.

This Global Monitoring Report (GMR) highlights two areas that require greater international attention if higher global growth trends are to translate into sustainable development outcomes and if the gains are to be shared more evenly:

Gender equality

The first of these arises from gender inequality and lost opportunities for all people to help generate and participate in the gains from economic growth. The choice to focus the 2007 report on the third MDG-the promotion of gender equality and empowerment of women-reflects a recognition by the international community that more is needed to support equality for the half of humanity disadvantaged through less access than men to rights (equality under the law), to resources (equality of opportunity), and to voice (political equality).

Fragile states

The second risk arises from the especially difficult development challenges and greater needs facing fragile states. Fragile states-countries with particularly weak governance, institutions, and capacity-comprise 9 percent of the developing world's population but over one-fourth of the extreme poor. They represent an enormous challenge: how can the international community provide resources to support efficient service delivery, postconflict recovery, and reform? Without addressing these development challenges the fragile states pose risks that can cross borders-through civil conflicts, risks to public health, and humanitarian crises.

Two additional risks pertain to environmental sustainability and securing the gains from trade liberalization. Natural resource depletion and environmental degradation pose risks to both the quality of growth, and the potential for sustaining future growth. Growth based on the depletion of natural wealth, rather than through increasing wealth for current and future generations, is unsustainable. The "adjusted net savings rate" measures national savings after accounting for resource depletion and damage to the environment, raising broad policy questions about environmental policies that are beyond the scope of this report but may be tackled in future GMRs.

Risks from failure to advance multilateral trade liberalization and expand market access are also highlighted in this year's report. The Doha Round of trade negotiations was effectively suspended in July 2006, but early in
2007 there was an informal agreement to resume talks. Failure to make progress means depriving many countries of vital opportunities for accelerating their growth through trade.

To address these risks and advance the MDG agenda there is a pressing need for better aid coordination to strengthen aid quality and scale-up assistance. This requires efforts by all parties-donors, international financial institutions (IFIs), and developing countries. Agreement needs to be forged at the global level on practical mechanisms and instruments to scale up aid and on measures to reduce the costs of aid fragmentation. Progress with scaling-up will require more and better aid resources (donors); sound, sequenced development strategies (developing partners); better technical support for strong strategies (the IFIs); and a more coherent "aid architecture" to reduce the costs of fragmentation.

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