Poverty is a serious economic and social problem that worries the world’s population. Therefore, it is essential to identify the cause of poverty, measure its duration, and evaluate progress towards its eradication. The World Bank defines poverty lines by assessing the cost of goods and services needed to meet the primary livelihood.
When people and economic activity focus on just a few cities within a country, from an economic context, we know this attention can be positive, overall living conditions can improve, poverty rates can lessen, companies can learn from each other, and relationships can be built between employees and firms.
For those people who work in poor regions where there are no opportunities for jobs, it becomes more difficult for them to enter employment and have a good quality of life.
Poverty rate
Poverty rates have been lessening in many of the world’s regions, but the number of people living less than the international poverty line remains high, especially in Sub-Saharan Africa.
Economic growth
Economic growth is vital to their resources to increase both their output and income, thus breaking the poverty trap and providing for their basic needs. However, for economic growth to help lessen the poverty rate, it needs to be both general and increase at a higher rate than the rate of population growth.
Agriculture is the effective economic sector in most poor communities. Therefore, efforts to fight extreme poverty are needed to increase agriculture production and productivity.
Economic growth also requires public investments such as roads, electrical power, hospitals, schools and sanitation systems, and water.
These investments are important for many reasons. First, good roads reduce transportation costs and generate different economic benefits that increase the ease of transporting agricultural produce to markets, contact with agricultural inputs, and increase the profitability of income-generating businesses.
Providing electric power improves not only standards of living but also stimulates the founding of small-scale industries that process agricultural produce.
The purpose of poverty reduction can be achieved through sound policies that address the root cause of poverty, promote economic growth and the basic needs of the poor, and improve their standard of living.
Many countries in Sub-Saharan Africa have developed poverty decrease plans that are currently being implemented to better the standards of living of the poor.
Promoting institutions and program
Lack of finance is a major problem for establishing small-scale businesses and other income activities in many developing countries. This force can be the much-needed credit provided to small businesses unable to enter credit from formal financial institutions through microfinance institutions.
Improving the marketing systems
The best way to reduce poverty is to raise the productive ability of the poor. Efficient marketing systems support the needy in increasing their production because they quickly deliver products to markets at competitive prices, resulting in increased earnings.
