Unfortunately, there is evidence from many countries that wealth gaps between rich and poor are widening. Recent household survey data from the Inter-American Development Bank from fifteen countries in Latin America shows worsening income distribution. In India, wealth gaps between the rural poor and urban population, and between rich and poor states, are weakening the impact of growth on poverty. Similarly, rising inequality has contributed to an increase in poverty in China. Failure to reverse these trends through more equitable growth strategies will place the 2015 targets beyond reach.
Governments have a key role to play.
Poor people are frequently excluded from the opportunities created by globalisation by inadequate access to productive resources, weak marketing infrastructures, illiteracy and poor health. Government action in these areas is vital to achieve a wider distribution of opportunity. Redistribution through fiscal transfers is one option. But the real challenge is to create the conditions in which poor people can produce their way out of poverty, contributing to national wealth creation in the process. Growth is good for the poor fails to address the real challenge facing policy makers in this area.