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Vietnam Today

Poverty rate continues to fall

Released at: 16:04, 06/04/2018

Poverty rate continues to fall

Photo: Ngoc Lan

Rate at 9.8% nationally but 13% in ethnic minority regions, according to World Bank's "Climbing the Ladder: Poverty Reduction and Shared Prosperity in Vietnam" report.

by Ngoc Lan

Vietnam’s poverty rate continues to fall but is 13 per cent in ethnic minority regions, the highest for the last decade, according to the “Climbing the Ladder: Poverty Reduction and Shared Prosperity in Vietnam” report, released by the World Bank at a workshop on April 5.

The report noted that improving earnings from highlands agriculture could help Vietnam further reduce poverty, which has fallen by almost 4 percentage points since 2014, to 9.8 percent in 2016.

Meanwhile, ethnic minorities - many of whom live in highland areas - account for 72 per cent of Vietnam’s poor, and encouraging them to grow more profitable industrial crops could improve their earnings.

Improving access to credit may help highland farmers make the necessary investments for higher-earning agricultural production. Strengthening earning capacity can help narrow inequalities between groups.  The average per capita consumption of ethnic minorities, for example, remains less than 45 per cent of the Kinh (the majority in Vietnam) and Hoa. Moreover, the poor face a widening gap in terms of access to upper secondary education and improved water and sanitation.

At the same time, the report recognizes that 70 per cent of Vietnam’s population is now classified as economically secure, including the 13 per cent who are now part of the global middle-class. These income classes are growing rapidly, rising by over 20 percentage points between 2010 and 2017.

An average of 1.5 million Vietnamese have joined the global middle class each year since 2014, confirming that households continue to climb the economic ladder after escaping poverty.

The rise of the consumer class changes society’s aspirations and the focus of the poverty and shared prosperity agenda shifts from combatting extreme poverty to effecting broad improvements in the quality of life and supporting the further expansion of the middle class.

Rapid job creation and an ongoing transition to wage employment are driving gains in poverty reduction and shared prosperity.

The report also summarized typical poverty cases and trends in Vietnam as well as suggested solutions to fully tap agricultural potential in mountainous areas which have high percentages of poor people.

Mr. Ousmane Dione, World Bank Country Director for Vietnam, told the workshop that the findings of the report provide vindication that Vietnam’s economic and social policies have helped to achieve tremendous results in reducing poverty and improving the quality of life for millions. “Vietnam has indeed climbed several large steps up the ladder to reduce poverty and improve shared prosperity,” he added. “It is even more important that poverty reduction is highly visible in lagging areas and among disadvantaged groups such as ethnic minorities.”

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