Asia and the Pacific are estimated to have around 800 million
poor, by the definition of people living on less than one dollar
a day. The poor in Asia and the Pacific account for two-third
of all the poor in the world.
While the issue of poverty has been the direct or indirect focus
of development initiatives in Asia and the Pacific since the end
of the colonial era (1940s to 1950s), the issue of urban poverty
has gained prominence only in the last two to three decades. Two
basic “levels” or “types" of poverty are
identified in the development literature: absolute poverty and
relative poverty. Simply put, absolute poverty is defined as the
cost of the minimum necessities needed to sustain human life.
The World Bank currently regards people earning less than US$
1 a day (in 1993 purchasing power parity) to be absolutely poor.
Relative poverty is defined as the minimum economic, social, political
and cultural goods needed to maintain an acceptable way of life
in a particular society. The European Union defines the relatively
poor as “... persons, families and groups of persons whose
resources (material, cultural, social) are so limited as to exclude
them from the minimum acceptable way of life in the member state
in which they live.”
Terms such as poverty eradication and poverty alleviation are
often used interchangeably in the development literature. It is
important to distinguish what these terms imply. While absolute
poverty can be eradicated, relative poverty can only be alleviated,
because what is minimally accepted today may vary over time, from
villages to urban areas and from country to country. Relative
poverty also varies with levels of economic development, and the
perceptions and expectations of the majority on what is minimally
acceptable. For example, while clean piped water may be a minimum
acceptable standard of living in a city, it may not be a minimum
requirement in a village. Similarly, while possessing a telephone
may be a minimum necessity in a country like the United States,
it may not be a minimum requirement in a country like India. Likewise
while Internet connections may not be a minimum necessity in India
today, they may become a minimum necessity ten years from now.
Poverty essentially has three closely interrelated aspects: “poverty
of money”, “poverty of access” and “poverty
of power.” These three conditions are closely related. Access
to essential infrastructure and services requires adequate income,
while undertaking income-generating activities requires good health
and education and access to services such as market information
and credit. Inclusion in the delivery of essential services requires
participation in decision-making, but participation in decision-making
requires access to services and availability of time to spend
on participation without loss of income.
It is therefore ESCAP’s view that poverty reduction requires
a comprehensive approach that simultaneously reduces poverty of
income, poverty of access and poverty of power.
Poverty of income and
Poverty of access to
essential infrastructure and services
Poverty of power and participation
income and assets
The most prevalent means of measuring poverty have been and continue
to be those related to money. Measures such as poverty lines and
Gini-coefficients are used to measure absolute and relative poverty
in terms of incomes and affordability. They are prevalent because
such measurements are relatively easy to make and quantify.
However, the lack of money is more a symptom of poverty rather
than its cause. In most cases, the poor are not without an income;
what they lack is the ability to accumulate assets, which is a
key ingredient to the creation of wealth and breaking the cycle
Besides their low earnings, the prime reason for their inability
to accumulate assets and thus increase their security of income
is that their profits or potential savings are often appropriated
by moneylenders who charge usurious interest rates, by formal
and informal regulatory and enforcement agents or organizations
who demand bribes or extort protection money, and by middlemen
or other stronger business partners who exploit the poor because
they lack market information or the ability to use that market
information to increase their own incomes.
Another key reason that prevents the poor from accumulating capital
is that they are often forced to purchase public goods and services
that are readily available to other groups in society at market
or below market prices, at much higher costs.
access to essential infrastructure and services
Most of Asia’s urban poor live in overcrowded and unsanitary
slums and squatter settlements and often do not have access to
basic infrastructure and services. They are forced to live in
illegal and informal settlements because they cannot enter formal
land and housing markets. The reasons for the formation of slums
and squatter settlements are numerous and have been discussed
extensively in the development literature. It suffices to say
here that, because of the way formal markets are regulated and
structured; the poor are unable to afford the choices offered
to them in these markets. In contrast, the informal and illegal
housing markets of slums and squatter settlements are specifically
geared to meet their shelter needs.
However, like other informal markets, the informal land and housing
market is exploitative and has several negative impacts. First
and foremost, informal settlements are often located on marginal
land (along river-banks, railway lines, steep slopes and on or
near garbage dumps) and are prone to natural and man-made disasters.
They are also often illegal and those living there do not have
security of tenure. Because of their illegal status, they are
often not provided with formal basic infrastructure and services
such as piped water, electricity, wastewater disposal and solid
waste collection by government agencies and organizations. They
have to purchase these in informal markets, often paying much
more than higher-income groups. Studies in several cities of Asia
and the Pacific have shown that the poor end up paying two to
five times as much for informal access to public goods and services
than higher-income groups.
Because there is often no security of tenure in illegal settlements
and the fear of imminent eviction exists, the poor do not invest
in improving either their housing or their settlements. The lack
of basic environmental infrastructure and locations on marginal
land often translate into higher rates of disease and lower life
spans. The consequent higher medical bills, lost working days
and early demise of income earners further expropriate their marginal
income and cements the cycle of poverty.
Similarly, children of the poor are unable to access good education.
Often the standards and facilities of the educational institutes
they can afford are lower than those available to children of
higher-income groups. Moreover, poor children often drop out of
school earlier to support their families. Poor education also
contributes to entrenchment of the cycle of poverty.
power and participation in decision-making
The poor suffer from both traditional and modern environmental
health risks in urban areas. They suffer from diseases associated
with poor sanitation, lack of clean water, overcrowded and poorly
ventilated living and working environments, as well as from modern
risks caused by air and industrial pollution. While the poor suffer
the most from dysfunctions in cities, they are the least able,
as individuals, to influence how cities are governed.
In many Asian cities, both the formal structures of government
and the culture of governance tend to exclude the poor from decision-making
and tend to concentrate decision-making among a small number of
formal and informal elite. The poor have a greater possibility
to influence decision-making under conditions of good governance,
i.e., a system of government and a culture of governance that
is participatory, inclusive, consensus-oriented, based on the
rule of law, responsive to the needs of the population, efficient,
transparent and accountable.
Another important aspect of power is information. The poor often
lack access to information that they can use to advance their
case when dealing with other actors in the city. Even when information
is available, it is often in media and forms that are neither
not accessible to, nor understandable by, the poor.