Is Micro-Credit a Tool for Sustainable Development and Poverty Alleviation?

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  • Topic: Poverty, Millennium Development Goals, Microfinance
  • Pages : 4 (1218 words )
  • Download(s) : 21
  • Published : November 14, 2010
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THERE is no reputable statistical evidence to date to show that micro-credit works for reducing poverty or enhancing social contribution by the poorest section of the population.

Does it move people permanently across the "poverty line"? No, again because no evidence to say it does or can. Do the micro-loans go to tiny businesses and do those businesses grow? Again the answer would be mostly no. There is no solid data to disprove this.

Around 2.7 billion of people in countries across the globe are considered to be living in poverty, according to statistics from the United Nations Development Program (UNDP). These people have a consumption level of less than US$ 2.0 per day. Extreme poverty is defined as living in less than $1.0 per day. Around 1.1 billion of the poor live in different countries are in extreme poverty. People living in extreme poverty often lack in opportunities to have their basic needs met, meaning access to food, clean water, clothes and decent shelter. Most lack education and are vulnerable to diseases. Most of the poor are also exposed to political, juridical or social injustices and have little or no power to make their own choices or form their own life situation.

One important aspect of poverty is that it is women, to a significantly higher degree than men. Seventy per cent of those living in extreme poverty are women. Women are illiterate to a higher extent, are more exposed to malnutrition and diseases and lack social, political and economic rights in many places.

Nevertheless, women take a bigger responsibility for providing for the family and usually work harder than men.

The essence of poverty is the combination of lack of power and choice and lack of material resources. People living in poverty are not only lacking in, material resources, but also in, freedom to decide over and shape their own lives. Poverty deprives them of the opportunity to choose on matters of fundamental importance to themselves. Poverty affects...
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