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Opinion
 

The four faces of poverty in South-east Asia

The Straits Times recently  launched a new column called S.E.A View offering views on South-east Asia affairs from expert commentators and reporters from our regional network of bureaus . Here's a selection:

Published on Apr 24, 2014 12:13 PM
 
Poverty 4.0 is poverty created by structural injustice. These poor might include young women drawn into factory work in Cambodia, Indonesia and Vietnam (above), where competitive austerity engenders a ''race to the bottom'', keeping salaries so low that there is little scope to save. -- ST FILE PHOTO

The headline story of South-east Asia is one of success.

Yet, there is a puzzling persistence of poverty in the face of rapid economic expansion. To unravel this puzzle we need to think differently about poverty, how it is measured and experienced and, importantly, how it is tackled.

Development does not so much eradicate poverty as re-engineer it. When people claim they are poor in 2014 they are not usually suggesting that their poverty is the same as that of their forebears.

In 1982 I spent almost a year working in two villages in the province of Mahasarakham in the north-eastern region of Thailand.

At that time Thailand was poor and the north-east was the poorest region of the country. The households I worked with had little income, almost no consumer goods, and few amenities.

Although there was a small primary school, a mere handful of villagers, almost all of them farmers, had more than four years of education. These villagers were poor, but there were also no great cleavages in village society. The experience of poverty - of meagre living - was a shared one.

In 2012 I completed, with colleagues at Khon Kaen University, a study of three villages in a neighbouring province - Khon Kaen. In the intervening three decades Thailand has progressed from low to upper middle income status. These villagers lived palpably more comfortable lives. They had running water, electricity, the large majority of households owned motorbikes and mobile phones, and their children went to secondary school. They also had bank accounts and could access medical care.

Even so, more than one-third described themselves as ''poor'', and nearly one in 10 as ''very poor''. Tellingly, these villages were also far more unequal places in terms of income gap, housing, education levels and consumer goods acquisition.

Despite three decades of rapid economic growth and rising incomes, poverty seems as entrenched today in rural Thailand as it was in 1982.

To understand the ''stickiness'' of poverty we need to think of it being experienced, produced - and tackled - in four very different ways.

Poverty 1.0 is the poverty that we are familiar with. These are the poor who are identified internationally using the US$1.25-aday international poverty line, later raised to US$2-a-day (S$2.53), set by the World Bank and used by many international organisations so that comparisons can be made between countries. Most of the villagers I interviewed in Mahasarakham in 1982 fell into such a category of absolute poor.

Using the US$1.25-a-day line, there were no poor in Brunei Darussalam, Malaysia or Singapore in 2010, and just 100,000 or so in Thailand. If, however, we raise the line to US$2-a-day then, miraculously, the number of poor across South-east Asia almost trebles from 70 million to close to 200 million.

Where we draw the line may seem arbitrary, but it is certainly not academic. This poverty of dearth creates an agenda where growth is pursued to ''lift'' the poor above the absolute poverty line, wherever it is drawn.

Poverty 2.0 views poverty through the lens of inequality.

The poor are those individuals or households living below a certain fraction of the median income. This is the approach to measuring the poor adopted in many rich countries. It also explains why one-third of households in our Khon Kaen villages described themselves as poor. They were not making a claim to absolute poverty. Rather, they were drawing a distinction between their own living conditions and those of their more affluent neighbours.

Inequality is important not just because it makes people feel poor relative to others. Studies have shown that a more equitable distribution of growth will reduce Poverty 1.0 faster than a less equitable distribution of growth.

In the most unequal countries, a 1 per cent increase in incomes reduces absolute poverty by just 0.6 per cent. In the most equal countries it generates a 4.3 per cent reduction in poverty. At a humanitarian level this is important. If we are concerned about poverty, we should be interested in inequality.

But inequality is also important for many other reasons.

There is growing evidence that societies where income is unequally distributed tend to be less healthy, more violent, display greater social problems, and have poorer educational outcomes.

The worry for South-east Asia is that inequality has been increasing in recent years.

Poverty 1.0 and 2.0 might be viewed as ''old'' poverty; the inherited poverty of underdevelopment (1.0) made more intractable by the unequal distribution of growth (2.0).

Poverty 3.0 and 4.0 are ''new'' forms of poverty created, paradoxically, by the development process itself. This happens in two rather different ways.

The 3.0 Poor may well find their living conditions improving in real terms. But they are unable to fulfil their aspirations and therefore feel frustrated. That so many South-east Asians have acquired a degree of material prosperity but remain dissatisfied requires us to turn our attention to the cultural and social bases of poverty.

What are the resources that society deems important to acquire, display or consume, and the absence of which is regarded as emblematic of poverty? This question requires that we venture into debates about well-being and human development.

It appears that whereas in rich European countries well-being ''exceeds'', relatively speaking, per capita income, in wealthy Asian countries the reverse is the case. This shifts the debate from the quantity of growth to the quality of growth. It brings into sharper focus some of the negative consequences - or ''costs'' - of modernisation, including social and environmental problems.

Finally, and most contentiously, there is Poverty 4.0. This is poverty created by structural injustice or violence linked to the operation of the market economy.

These poor might include, for example, small holders forced off their land due to land grabbing by powerful elites and transnational capital in Laos.

They could also be fisherfolk who find their traditional fishing grounds denuded by sand mining in Cambodia.

Or young women drawn into factory work in Cambodia, Indonesia and Vietnam, where competitive austerity engenders a ''race to the bottom'', keeping salaries so low that there is little scope to save.

South-east Asian countries have been very good at generating growth and reducing Poverty 1.0. They have been rather less good at addressing Poverty 2.0, but nonetheless the success of the growth agenda has made this, until recently, less urgent. It is with regard to Poverty 3.0 and, especially, Poverty 4.0 where the emerging development challenge lies.

stopinion@sph.com.sg

The writer is a professor with the Geography Department of the National University of Singapore. He has been researching development transformations in South-east Asia, with a particular focus on agrarian change, since the early 1980s.

This story was first published in The Straits Times on March 13, 2014