Ending Extreme Poverty

It is easy when we are in prosperity to give advice to the afflicted.
Aeschylus

Engineers Without Borders launched an initiative this week to end poverty in 2020. They edited a newspaper with the main headline “Worldwide celebrations: End of extreme poverty declared”. They outlined three steps to end extreme poverty: Fair Trade, Aid, and Corporate Responsibility.

If only that would be so easy!

Fair Trade is one of the most important movements to help end extreme poverty. If I finally can start my PhD, Fair Trade will be a very important component in my research, and my final thesis on my MBA was about Fair Trade, as you can read in many of my post (check out the fair trade category!). In reality though, fair trade is not an end by itself. I found out that, while we want people to receive fair prices for their products, as long as they continue producing the same goods in the same way, they will continue to be poor. Fair Trade only accounts for 5% of coffee and chocolate market now, and even less for other products. Even the newspaper states that fair trade are “most notably coffee, but also chocolate, sugar, cotton and more”. Can we really end poverty focusing in such a reduced products spectrum?

International Aid. The paper made a very good observation about the quality of international aid offered by Canada and other developed countries: “Today, roughly 40% of our international aid comes with strings attached – it’s “tied” to purchases of Canadian goods and services, rather than being used to buy the most appropriate or inexpensive items available. It’s estimated that fully 50% of Canadian food aid is tied”. But several scholars, included Jacques B Gelinas have questioned the efficacy of international aid for solving poverty.

Corporate Social Responsibility is the strongest point. With the rise of active shareholders and social and sustainable index, companies are forced to do a better job to create and share wealth among society, but only a small part of the world is employed by these corporations. An ethical code of conduct shall be adopted by all the companies, even those small and medium, to behave in the business world. I can still recall how the worst cases of workers abuse in my country are not inflicted by international corporations but by small business that still discriminate by age, gender and physical appearance.

I hope that we can follow Karl Marx’s directive of nobody having in excess while others lack the essential.