***This article looks at the state of play at the international level relating to concerns and strategies for poverty reduction around the world (Parts I and II) and reviews the prevailing situation in Bangladesh relating to poverty and poverty reduction strategies (Part III). Parts II and III will be published later.***

***Two fundamental trends now characterise the global order. One is the neo-liberalist globalisation seeking economic integration of countries of the world on the terms and agenda set by the dominant developed world, mostly spearheaded by such international agencies as the Bretton Woods institutions and WTO. The other is the accentuating disparity, in the wake of globalisation, between developed and developing worlds and between the rich and the poor within countries.***

OVERTY reduction" is the latest much vaunted "buzzword" in the international development parlance and has been doing its round as such from the late 1990s. It has come to occupy top billing in the agenda of the Bretton Woods institutions -- the World Bank and the IMF -- and the regional development banks. In 1999, the Bank-Fund duo called for a poverty reduction strategy paper (PRSP) to be formulated by each foreign aid (grants and concessional loans) seeking country. This new "aid conditionality" has been supported by all multilateral and bilateral aid providers. Many developing countries have finalised their PRSPs or (as in the case of Bangladesh) Interim-PRSPs (I-PRSPs), and there are others which are working on their PRSPs. However, some countries, notably India, rejected the call for preparing such a paper, dismissing it as unnecessary given that their own national poverty reduction plans and strategies are already in place.

Poverty reduction is also placed at the number one spot in the list of the so-called Millennium Development Goals (MDGs). This top ranked MDG of halving the number of poor people by 2015 was also endorsed by the World Summit on Sustainable Development (WSSD) held in Johannesburg (South Africa) in August-September 2002.

Even the World Trade Organisation (WTO) launched a development round of trade talks in November 2001 in Doha in recognition that poverty reduction is a critical need in the developing countries. The recently (10-14 September 2003) held WTO Ministerial in Cancun, though, brought into open that those proposals, as far as the north is concerned, were more rhetorical than commitment-based. There has been no progress in respect of the development issues envisaged in Doha such as special and differential treatment of the developing countries, implementation issues, technology transfer, and commodity issues (sharp fluctuations and long term declines in the prices of primary commodities on which dependence of developing countries is large indeed).

Again, in the UN conference on financing development held in March 2001 in Monterrey (Mexico), the developed countries made a commitment to make the best effort including transfer of adequate resources and technologies to help reduce poverty in the developing countries. But, no notable progress in this regard has so far occurred. Moreover, official development assistance (ODA) from the OECD countries, which was only 0.33 per cent of their combined GDP in 1990 against the promised 0.7per cent, further declined to around 0.22 per cent in 2001 (UNDP Human Development Report 2003, p. 290) and is likely to be even lower currently. For many developing countries, financial flows received in grants and concessional loans from bilateral and multilateral sources are outweighed by outflows of funds in terms of debt servicing and other transfers to the developed countries and multilateral agencies.

The above mentioned overtures of the aid donors to the cause of poverty reduction notwithstanding, the basic framework remains neo-liberalist, which found practical expression in the so-called Washington Consensus, orchestrated in the late 1970s, aimed at establishing an all embracing free market regime in the world through implementation of reform programmes promoting privatisation, deregulation, and globalisation everywhere, particularly in the developing countries. The developing countries have been persuaded, cajoled, even coerced under threat of noassistance conditionalities to embark upon such reforms, basically the same package for every country regardless of the widely differing conditions and circumstances faced by them. Also, it is the same Washington Consensusbased policy framework within which the so-called PRSP is to be formulated and implemented in each country.

It is now known that, as a result of implementing the reforms and pursuing globalisation, many countries, particularly in Africa and among transition countries, found their economies contracting, even collapsing. Many other countries, after years of implementation of the reforms, are still unable to accelerate their economic growth sufficiently or achieve significant reduction in their poverty levels. It is reported in the UNDP Human Development Report 2003 (p.3)

that: "In the 1990s average per capita income growth was less than 3 per cent in 125 developing and transition countries, and in 54 of them average per capita income fell." The 54 countries with declining per capita income belong to SubSaharan Africa (20), transition countries (17), Latin America and Caribbean (6), East Asia and the Pacific (6), and Arab States (5).

Moreover, in the wake of globalisation, disparity has significantly increased globally as well as in individual countries. In other words, the developing countries have fallen further behind the developed world, while the gaps between the poor and the rich in individual countries have also increased. Indeed, it is inherent in the dynamics of neo-liberalism that the strong and powerful -- countries at the international level and people at the national level -- become even stronger and more powerful while the weak and the disadvantaged -countries or people as relevant -face roadblocks, created by the respective power structure, that disempower them and impose severe constraints on their progress. Another facet of this process is that multinational and transnational companies (MNCs and TNCs) have silently but firmly captured the driving seats in the global trade, investment, and production regimes. Given that such companies control huge resources and management capacities, the nationstates, in both developed and developing worlds, particularly in the latter, have often, by force of circumstances, been compelled to abdicate their economic and financial power to them (the companies). Most of these companies originate in the USA and other developed countries and have made major inroads into developing countries, often acquiring controlling interests in different business sectors and, as a result, influence-peddling position relating to the formulation of economic and financial policies.

This powerful northern corporate world is now known to be scandal-ridden, evidenced by mega scandals involving corporate giants such as Enron, WorldCom, Vivendi and many others. Thus, not only that these mega companies have acquired unprecedented global market power in the wake of globalisation but also that they adopt unfair means and market manipulation and enter into collusion with others, who are in positions to be helpful to them and would extend help in return for grafts, towards enhancing their market power and multiplying their profits. It seems, therefore, that the world economy is now smarting under what may be termed as "corporateterrorism".

But, the USA, the UK, Japan, and the countries of South East and East Asia which came to be known as East Asian Tigers used interventionist measures, adopting industrial and trade policies as appropriate to protect their domestic markets and promote exports at the earlier stages of their growth and development. Only after attaining sufficiently strong techno-economic-management bases and significantly high levels of income that these countries began to open up their markets. Also, China has been following a go-slow strategy in respect of reducing tariff barriers, keeping the directives of the Washington Consensus at bay.

It may be pointed out that Thailand, whose economy collapsed in 1997 in the wake of its accelerated globalization including fully liberalised capital market, has since embarked on a path of economic rejuvenation after retracting from fast track liberalisation and introducing certain interventionist measures. On the other hand, most developing countries around the world opened up their economies fast, while they were still very weak in economic, resource access, and management terms. Obviously, their competitive ability was poor and eroded further as a result of the jolting received from stronger foreign competitors. Moreover, most of these countries have only a few items, often all or most of which are primary commodities, that account for most of their export earnings. Globalisation for these countries means, therefore, that their markets are open to all kinds of imports -capital, intermediate, consumer, even primary goods -- while they cannot increase their export earnings much as they simply do not have more things to export.

Moreover, they face steep competition in the export market, given that the same or similar goods and commodities tend to be exported by many other developing countries. Commodity exports have also usually been subject to price fluctuations around a declining trend and, also, often to chronic adverse terms of trade against manufactured imports -- i.e. overtime, manufactured imports (which the developing countries mostly import) become increasingly expensive in terms of exported primary commodities (which the developing countries mostly export). Also, their exports face tariff and non-tariff barriers in the developed countries. No progress has so far been made in the WTO trade talks in respect of access to the developed countries for non-agricultural exports of the developing countries. Movement of unskilled and semi-skilled people from developing to developed countries remains strictly restricted; indeed, easy movement of people is not a part of the on-going globalisation. This is obviously against the interest of the developing countries and, moreover, renders the on-going globalisation unfair and incomplete. Clearly, therefore, globalisation has been of limited benefit to the developing world while the lion's share of the wide-scale market expansion and tremendous wealth created in its wake has gone to the developed countries and their corporate sectors. Moreover, globalisation has created severe constraints on economic, social, and environmental progress for a large number of developing countries, and has in fact been constricting for many.

The above analyses may be summarised as follows. Two fundamental trends now characterise the global order. One is the neo-liberalist globalisation seeking economic integration of countries of the world on the terms and agenda set by the dominant developed world, mostly spearheaded by such international agencies as the Bretton Woods institutions and WTO. The other is the accentuating disparity, in the wake of globalisation, between developed and developing worlds and between the rich and the poor within countries. In this global order, appreciable achievements in relation to development and poverty reduction have not only eluded most developing countries, but also many of them have experienced setbacks. The question now is: what is the prospect of poverty reduction, which is now at the top of the agenda of the international community, within the framework of the on-going neo-liberalist paradigm? Also, so far in this article 'poverty' has been used without qualifications, as if the term has a unique meaning. But, poverty has many facets and dimensions. In part II, these and other relevant questions will be addressed.

Dr. Qazi Kholiquzzaman Ahmad is

President, Bangladesh Economic

Association (BEA), and Chairman,

Bangladesh Unnayan Parishad (BUP)