UNDP Resident Representative in Việt Nam Ramla Khalidi. Photo VGP

Ramla Khalidi

October 17 is the World Day for Overcoming Extreme Poverty, officially recognised on the United Nations calendar since 1992. UN Poverty Day is an opportunity for us to reflect on the tremendous achievements that we have made in reducing extreme poverty around the world, but also a reminder of the work that remains to be done.

In 2000, 29 per cent of the world's population lived on US$2.15 per day or less in constant 2017 international dollars, according to the World Bank. By 2022, this figure had fallen to 9 per cent.

The Millennium Development Goals (MDGs) to 2015, followed by the Sustainable Development Goals (SDGs) to 2030, represent an unprecedented global movement to eliminate hunger, deprivation and human suffering. The commitment shown by governments, civil society, international organisations and the poor themselves to ridding the world of the scourge has given hope to millions and has shown the way forward for global collective action to solve common problems.  

On a less positive note, most of these gains were achieved before 2013. The number of people living in extreme poverty fell by half from 2000 to 2012. Over the next decade, extreme poverty was reduced by another 11 per cent, to 716 million. Clearly, the pace of change had slowed.

COVID-19 is partly to blame for this loss of momentum. The ILO estimates that business closures and social distancing measures resulted in a loss of more than 100 million jobs in 2020 alone. The number of extremely poor people rose by about 70 million in 2020 and 2021. But slower progress was already apparent long before the COVID-19 pandemic hit. A decade of fiscal austerity after the Global Financial Crisis, rising protectionist sentiment, higher and less stable food prices and a real-terms decline in overseas development assistance were contributing factors.

The theme of this year’s International Day for the Eradication of Poverty is “Ending Social and Institutional Maltreatment.” We know poverty has multiple dimensions; some immediately observable, like hunger and malnutrition, and others hidden. The hidden dimensions of poverty are often the most difficult to tackle. This year’s theme calls attention to the debilitating impact of stigma and discrimination on poor people, especially when bias and intolerance are institutionalised and routinised in government, business, civil society and culture.

Around the world, people living in poverty confront chauvinistic attitudes and negative stereotypes. They are blamed for their situation even though they struggle every day to find work and earn a decent living. Discrimination is especially cruel when poor people are forced to endure other forms of prejudice because of their gender, sexual orientation, race, ethnicity or disability.

The institutionalisation of stigma and discrimination prevents people from realising their human rights to decent housing, education and healthcare, and legal rights like equal protection under the law. Millions of people around the world lack basic legal documents like birth certificates and national identification cards because of bureaucratic obstacles put in their path.

Public institutions, even those with the best intentions, disempower people living in poverty when they treat poverty as a social problem or burden on the community rather than a condition that can affect anyone at any time. The causes of poverty are many and varied, as are paths out of poverty. Treating people as individuals with unique sets of capabilities and limitations, and engaging them in finding solutions, is more likely to achieve success than relationships of control or subordination.

Việt Nam is widely recognised for the success of its anti-poverty programs. Extreme poverty as defined by the World Bank declined from 45 per cent in 1992 to one per cent today.

Việt Nam is also a leader in incorporating multidimensional poverty measures that go beyond income to include factors like access to health care, education, sanitation and clean water, into national policy. Since 2016, the government has closely monitored multidimensional poverty indicators, using them to implement regional and national anti-poverty programs.

Việt Nam is among 25 countries that have reduced their Multidimensional Poverty Index scores by 50 per cent, according to a study conducted by UNDP and the Oxford Poverty and Human ⁠​Development Initiative.

Multidimensional poverty fell to 2.9 per cent of the population at the end of 2023, according to the Ministry of Planning and Investment. Lack of access to education is the main cause of multidimensional poverty, especially in rural and remote areas.

Rapid and sustained economic growth and job creation have been the motors of poverty reduction in Việt Nam. The steady shift in employment from agriculture to manufacturing and services has increased the share of the population working for steady wages, resulting in less exposure to period of under and unemployment.

The government has played a leading role in poverty reduction, through the various national targeted programs for poverty reduction and rural development, and through mainstream programs to achieve universal access to education and health services.

Now that extreme poverty has been nearly eliminated in Việt Nam, attention has shifted to emerging vulnerabilities associated with climate change and other environmental challenges, demographic shifts, technological change, and gender inequality.

Climate change will increase the incidence of extreme weather events like typhoons, droughts and floods. Typhoon Yagi was a stark reminder of the destructive power of severe weather events, and the damage they can cause to infrastructure, livelihoods and living conditions, especially among people living in rural and remote areas.

Investment in advanced early warning systems and storm-resistant infrastructure and housing can help protect these communities from falling into poverty as a result of bad weather. Strengthening social protection programs to provide immediate support to sustain communities and households is also needed. Here the government also plays an important role in supporting recovery efforts through fiscal measures such as offering loan repayment relief for affected businesses. Such measures ease financial burdens during the immediate aftermath of a natural disaster.

Demographic change is another challenge. Việt Nam will enjoy a demographic dividend until about 2040. This is defined as a period of low dependency ratios, when the number of working people exceeds the number of older people and children. As the number of older citizens increases, households will have to dedicate a larger share of their resources to supporting non-working family members.

This could result in financial pressure on households that lack access to pensions. As a majority of Vietnamese people work in the informal sector, it is estimated that only one-third of households has access to some form of regulation income after retirement.

The impact of automation on poverty reduction in Việt Nam is unknown. For example, more than three million people now work in the garment industry in Việt Nam, many in labour-intensive assembly operations. These jobs have been resistant to automation because unit labour costs in Việt Nam are still relatively low, and the cost of automation is high.

However, with the rapid incorporation of artificial intelligence into industrial operations it is conceivable that the number of workers required to perform simple assembly operations will fall in the near future.

In anticipation of this possible outcome, more investment is needed in vocational and higher education to prepare workers for the jobs of the future, many of which will require intermediate-level and advanced skills.

The growing importance of skills suggests that education and training is an important growth sector in Việt Nam. Regulatory reform is needed to stimulate investment and job creation in the sector, especially in emerging fields like computer and data science, engineering, cybersecurity, logistics, and supply chain management.

A contributing factor to Việt Nam’s rapid progress in eliminating poverty is the country’s high female labour force participation rate, which stood at 68 per cent in 2023. However, traditional stereotypes and prejudices remain a barrier to women’s progress. A strict gender division of labour closes off some preferred jobs to women, and even when they are allowed to do the same jobs as men, they are often paid less. Gender-based violence is a major concern, with UNFPA estimating that nearly two-thirds of women between the ages of 15 and 64 have experienced some form of violence by men.

Việt Nam has made progress to achieving SDG 5 on gender equality. The government has strengthened legal and policy frameworks to eliminate barriers for women and girls in terms of access to education, health care, employment and access to justice. However, discrimination and stereotypes are still obstacles to full equality. Men and boys do not share caring and household duties equally with women and girls, and women are under-represented in senior management in both the public and private sectors. In some rural and remote regions, child marriage, teenage pregnancy and marginalisation continue to affect women and girls of all ages.

As we commemorate the International Day for the Eradication of Poverty, Việt Nam has much to celebrate. The benefits of economic development have been widely shared, and relatively few people still suffer from extreme forms of poverty. However, new threats to human well-being constantly emerge, and policies need to evolve continuously to counter them. Importantly, we must remain vigilant in our efforts to eliminate stigma and discrimination from our institutions, cultural practices and behaviours. As member countries of the United Nations, we reaffirm, in the words of the UN Charter, “our belief in fundamental human rights, in the dignity and worth of the human person, in the equal rights of men and women and in nations large and small.”

It is this commitment to equality under the law, as citizens and as members of society that we celebrate today.

*Ramla Khalidi is the UNDP Resident Representative in Việt Nam