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Breaking the Poverty Trap
Breaking the Poverty Trap
UPDATED: March 5, 2010 NO. 10 MARCH 11, 2010
WB-Styled Work
World Bank's long-time commitment to poverty alleviation in the world's most populous country

GIVEN IMMUNITY: Alan Piazza (back right), a World Bank economist in charge of several poverty reduction projects in China, stands with children from a village in Ximeng County, Yunnan Province, in May 2007. The young villagers benefitted from a World Bank sponsored vaccination program for children (COURTESY OF ALAN PIAZZA)

The World Bank-sponsored Shanghai Conference on Scaling up Poverty Reduction in May 2004 brought together more than 1,000 people, most from developing countries, to share experiences and practices in poverty-reduction efforts. The conference, which included analysis of more than 100 case studies from around the globe, highlighted China's success in large-scale poverty reduction as well as the need for flexible approaches that engage the poor in finding solutions to poverty.

Following the conference, the World Bank, through World Bank Institute, has agreed to support the establishment of an international poverty research center in China. World Bank has also worked with the Chinese Government to complete the 2009 national poverty assessment From Poor Areas to Poor People: China's Evolving Poverty Reduction Agenda.

Besides raising incomes, improving food security, and expanding access to basic services, World Bank supported poverty-reduction projects that have been playing an important role in developing a multi-sector approach to poverty reduction. At present, the Poor Rural Communities Development Project is supporting participatory poverty reduction through the multi-sector approach in Sichuan and Yunnan provinces and Guangxi Zhuang Autonomous Region, and the proposed Sustainable Development in Poor Rural Areas Project will support the scaling-up of community-driven development (CDD) poverty-reduction approach in Chongqing Municipality, Henan and Shaanxi provinces.

The World Bank has supported five direct poverty reduction projects in China.

- Southwest Poverty-Reduction Project

Implemented between 1995 and 2001 in Guangxi, Guizhou and Yunnan, the project covered 35 of China's poorest counties in 600,000 households, ultimately assisting 2.8 million people. The World Bank provided $247.5 million for the project, with the other half provided by the Chinese Government .

The project has proven effective by using a multi-sector approach to reducing poverty. It resulted in an increased per-capita income from 939 yuan ($138) to 1,422 yuan ($209) and a drop in poverty levels from 31.5 percent to 13 percent. The project helped improve the enrollment of girls in school; it led to an increase in agricultural production; and increased access to drinking water, electricity, rural transport, and other basic infrastructure.

- Qinling-Daba Mountains Poverty-Reduction Project

The principal objectives of the project between 1997 and 2004 are to demonstrate the effectiveness of a focused multi-sector rural development project approach to poverty reduction, facilitate a "market-friendly" increase in labor mobility from the poor areas to better-off rural and rapidly growing urban areas, upgrade poverty monitoring at the national and local levels and significantly reduce absolute poverty in 26 of the poorest counties in the region of Qinling-Daba mountains, located mainly in Shaanxi and Sichuan provinces.

The project also stabilizes or even reverses upland environmental destruction through land and pasture improvement and soil conservation works, and encourages greater local community participation by enabling households to make key decisions during project design and implementation.

- Gansu and Inner Mongolia Poverty-Reduction Project

The project, initiated in 1999, aims to reduce the incidence of absolute poverty in remote and inaccessible villages of Gansu Province and Inner Mongolia Autonomous Region. The project helps poor households in the selected poor counties to raise their incomes, through increased grain and livestock production sufficient to meet the basic needs of food and clothing and, in many cases, also generate a marketable surplus to improve living standards.

- Poor Rural Communities Development Project

The project from 2005 to 2010 seeks to improve livelihood security, and achieve a sustained participation of the rural poor in project design, implementation, and in the monitoring and evaluation aspects within Yunnan, Sichuan and Guangxi. The project is expected to cost around $140 million.

- Community-Driven Development Program

The State Council Leading Group Office of Poverty Alleviation and Development, in collaboration with the World Bank, launched a two-year CDD program in 2006. The pilot program, operating in 60 poor villages in Shaanxi, Sichuan, Guangxi and Inner Mongolia, promotes stronger village engagement in poverty alleviation. Participating poor communities themselves make local development decisions, manage funds, and directly implement small-scale infrastructure and public service improvements.

The pilot program is supported by a $2-million Japan Social Development Fund grant, matched by about $4 million from participating government agencies of China.

(With contributions from the World Bank)

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