Positive changes mask elements of poverty

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A H'mong woman plows a rice field in the northern province of Ha Giang. The area's economy is based on agriculture. Photo: AFP

The poverty rate has reduced over the past few years, but overall positive changes mask some elements of poverty that remain a significant concern, Andy Baker, Country Director of Oxfam in Vietnam, tells Vietweek.

Vietweek: Tell us about the findings of your rural poverty monitoring project between 2007 and 2011?

Andy Baker: Oxfam and Action Aid Vietnam have been surveying the same 10 communes across Vietnam every year for the past five years, in order to track changes in poverty experienced by households. There is plenty of good news 55 percent of people interviewed felt that their lives have improved whilst only 9 percent felt their lives have gotten worse.

The survey looks at 10 different dimensions of poverty, moving beyond simple income measures and looking at such issues as health, education, living conditions, food security, risks and access to information.

Survey results show poverty has reduced in nine out of 10 of these parameters, all but perceptions of risk. However, these overall positive changes mask some elements of poverty that remain a significant concern.

Most alarming is the continuing issue of food insecurity and hunger. In 2007, 23 percent of the families questioned throughout monitoring sites reported that they experienced regular food shortages.

Although this number has reduced by nearly one third to 16 percent in 2011, the average number of months of regular food shortage among those families has increased by more than six weeks to 21 weeks per year.

For a country that ranks as one of the top global exporters of several agricultural commodities, it is unacceptable that many of its people still do not have enough food to eat.

In 2007 one in three children in the survey was malnourished and the level of malnourishment was still one in four in 2011.

Does the current economic slowdown affect the Vietnamese government's poverty reduction efforts?

Growth in Vietnam, both in agriculture and in urban areas through migration, has been a major driver of poverty reduction and of improving livelihoods. A slowdown in that growth inevitably means a shrinking number of opportunities and we are now seeing news of increasing unemployment and job losses, just as Vietnam experienced in 2008 and 2009.

Such job losses impact on workers and those they support, often including households in rural areas who depend on money sent from family members working elsewhere.

Economic shocks such as those caused by high inflation are causing significant challenges to many poor and near-poor people in Vietnam. According to the government statistics office, inflation in 2008 was close to 23 percent and in 2011 it was over 18 percent.

Food prices and agricultural input prices were higher nationwide, and whilst some areas remained better off due to higher prices for their crops, others lost out as they were squeezed by higher input prices, or as they lacked the means to take advantage of higher commodity prices.

In response to financial pressure, families have cut back on expenditures, consuming less meat and fish and turning instead to cheaper foods such as eggs, soy bean curds and dried fish, reducing the use of electricity, spending less on clothes, and cutting social expenses on weddings and funerals.

In mountainous ethnic minority areas, when the price of food rises, poor people tend to rely more on nature in their traditional ways, such as gathering vegetables, bamboo shoots and firewood from forests, and fishing in rivers and streams to improve their family meals and earn some income. This however often puts additional pressure on members of the household, especially women and girls.

Do you think that our point of view on poverty should change as the economy has seen many changes over the past years?

Poverty in Vietnam today has a very different face than 20 years ago and there are marked changes in the five years since this poverty monitoring survey began.

Poverty should no longer be looked at only in terms of income. The government poverty line and the total number of those whose income falls below it is a crude measure that does not show some of the other aspects of poverty.

The Oxfam and Action Aid Vietnam poverty monitoring survey looked at 10 dimensions of poverty and showed that education, household assets, food security and access to information have improved the most since 2007.

Access to markets to be able to sell products and buy agricultural materials, agricultural employment, risk management and living conditions such as access to electricity, safe water and latrines have seen limited improvements.

Points of view on poverty should change to recognize that poverty is not only about income, and that there are some groups in Vietnam, most notably ethnic minority people, who face more kinds of poverty than the majority population.

We need to be clear that many many people in Vietnam are still living in poverty, around 20 percent according to government statistics, with a further 16 percent experiencing lives that dip in and out of poverty.

Jobs are very important in poverty reduction. What should we do to generate jobs for local laborers in the context of an increasing number of companies shutting down or narrowing their business?

Whilst jobs in new industries are very important to growth and employment, agriculture remains the most significant source of employment in Vietnam. As the government develops strategies for the rural areas of Vietnam, we recommend that new strategies recognize that small scale farms can offer effective, efficient models of agricultural production, providing both a source of employment and a continued driver of growth.

Decisions on the future of land tenure could give farmers the security and control over assets that they can use to innovate and to continue to act as an economic driver.

The current situation of firms reducing their workforces demonstrates that where farmers are leaving the land and moving into other forms of employment, they need an effective safety net of social protection that can provide an income if they lose their job.

How has poverty reduction affected the country's GDP growth?

We are seeing the growth in GDP slowing, but also a shift in how that growth is experienced across the income scale, resulting in a widening inequality. Growth in Vietnam today is becoming rapidly less pro-poor.

What is the best measure to reduce poverty in a stable manner?

The growth model in Vietnam in the past 20 years has done a great deal to help people to get themselves out of poverty. The new context of global economic challenges threatens those successes. Deep and chronic poverty is increasingly linked to exclusion, to a lack of access to opportunities and to an inability to influence public policy.

Meanwhile much of the recent benefits of growth have gone to those at the top of the income distribution table, resulting in fast increasing levels of inequality.

One of the recommendations of the report to tackle the challenge of deep and chronic poverty is to overhaul the current social protection system. At the moment the government of Vietnam commits sizeable budgets to providing financial support to those with low incomes. However, this money is not always reaching those who most need it and as poverty becomes more concentrated, better targeting is needed.

The report recommends core changes to the approach, strategy and delivery of social assistance programs, for example, new innovations, such as direct cash transfers, should be piloted, with a particular focus on food-insecure households and ethnic minority people.

Payment levels need to keep pace with the overall increases in cost of living and graduation mechanisms should be in place to continue to support people as they lift themselves out of poverty.

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