## (c) Assistance to reduce poverty through economic growth

To reduce poverty, it is important to promote the economic growth of a country or a region as a whole, including poverty-concentrated areas, along with direct assistance to the poor. In particular, consideration should be given to generating growth that benefits the poor.

## (i) Employment creation

Raising incomes through employment is an important means of raising the living standard of the poor. A particular focus will therefore be on the development of labor-intensive medium, small and micro enterprises. Assistance will also be provided for the development of economic infrastructure fundamental to business activity, reform of institutions, and improvement of labor conditions to promote the participation of micro enterprises and expand domestic and foreign investment. Promoting tourism by making use of cultural attractions will also contribute to employment creation.

## (ii) Balanced development

Countries that are achieving economic growth also face the problem of regional disparities. These disparities occur in many cases between poor rural areas and comparatively affluent urban areas. For the development of rural areas, raising agricultural productivity is important. Japan will support the formulation of agriculture related policy, improvement of infrastructure such as irrigation and farm roads, dissemination and research/development of production technologies such as NERICA (New Rice for Africa), and strengthening of community organizations. Assistance will be provided to foster economic activities in rural areas, such as processing of agricultural products, development of market distribution and sale of foodstuffs.

In addition, basic infrastructure such as transport, energy and communications will be provided to link urban and rural areas where regional disparities exist. In providing such assistance, attention will be paid to ensure that infrastructure helps the poor to participate in economic and social activities by, for example, connecting feeder roads to national roads.

Pockets of extreme poverty exist also in urban areas due to population growth and migration from rural areas. Assistance will therefore be provided to labor-intensive medium, small and micro enterprises, with a particular focus on technical assistance to contribute to the development of micro-finance in urban areas.

As the poor often depend directly on natural resources for their livelihoods and are therefore particularly vulnerable to the effects of environmental degradation, full attention will be paid to ensuring sustainable development in reducing poverty through economic growth.

## (d) Assistance for institutions and policies to reduce poverty

(i) In order to reduce poverty, it is important to establish institutions and policies that protect the rights of the poor based on the principle of equality under the law, and to enable the poor to participate in political activities and to exercise their capabilities. Assistance will therefore be provided to contribute to the protection of human rights, the rule of law, and the promotion of democratization.

(ii) Assistance will be provided for capacity building to enable governments of developing countries to formulate and implement appropriate development strategies.

(iii) In order to minimize the impact on the poor of economic crises, inflation and similar events, macroeconomic stabilization through appropriate fiscal and monetary policy is essential. To this end, assistance such as dispatching experts will be provided to build the capacity of government officials.