Poverty, Inequality And Ethnicity: A Note to Policy Makers on Latin America

Abstract

During 2005 the international policy agenda, including that of the EU, has come to include the fight against global poverty. The Millennium Development Goals (MDGs) have catalysed the interest of policy makers, public and media in poverty reduction, partly because of the simplicity and ease of communication of the ‘one‐dollar‐a‐day’ income target for poverty reduction. However, there is more to poverty reduction than reaching the one‐dollar‐a‐day threshold: other MDG indicators which matter are the poverty gap ratio and the share of the poorest 20 per cent in national consumption ‐ because they are indicators not just of poverty but of inequality. Of the major regions of the world, inequality is greatest in Latin America. At a time when the focus of attention is on poverty reduction in Africa and Asia, it is important that Latin America should not fall off the poverty map. The high levels of inequality associated with Latin American poverty are politically and socially divisive, particularly because of the disproportionately high ethnic representation among the poorest. Because of the geographic, cultural, social, demographic context, such poverty is highly intractable. For reasons of equity, therefore, EU researchers and policymakers need to retain a broad view of the poverty‐reduction agenda.