Almost half the world lives on less than $2 a day. The majority of these countries are in so much debt to the World Bank they are unable to pay it back no matter how much they may try. Poverty is a word most people find synonymous with third world countries. However, poverty does affect other countries too. Poverty affects the economy of the country. This is no surprise. It also affects various other factors of the country. How does a country go about solving the poverty crisis in order to improve the economy?
How is one poor? How does one not have the financial means necessary to support a family? The first factor that contributes to poverty is lack of education. Many people, in the developing world, are unable to read and write. This inability keeps them from contributing to the country’s economy. Education enables a person to get better jobs and live better lives. However, many are unable to go to school because they are either too poor and are supporting their families by doing menial jobs or cannot afford all that education entails. Education in third world countries is not free. Lack of education leads to various other problems that burden the economy. So, the first order of business to improve the economy is to ensure that every person has an education, at least, to the 10th grade.
The other important factor that contributes to poverty is corruption among government officials. Aid is obtained by these government officials with the ruse of educating the poor. However, only a third, if that, is handed over to improve the education system. The rest goes into the government officials’ pockets. Many developed countries provide aid with the assurance that corruption will be allayed in these developing countries. However, the developed countries too are corrupt. The economic policies implemented by these countries on the developing countries also exacerbate the problem. The solution to improving the economy of a country, and this may be the most important, is stopping corruption among government officials. Once this is managed, the country can concentrate on doing what it takes to solve the poverty crisis to improve the economy.
Tax avoidance is another cause for the economic problems third world countries face. Many influential and rich people, in these countries, avoid paying taxes. They do all means necessary to ensure the government does not get a cent of what they earn. Instead, tax authorities are bribed and coerced and the excess of cash is sent to other countries where the country’s money lies in a personal account gathering interest. This results in massive losses of tax revenues. Then, once again, to make up for this loss, governments burden citizens by implementing more taxes. The solution: stop the money from going out of the country into personal accounts and use them for better purposes. This will definitely solve the poverty crisis and improve the economy.
There are so many ways in which one can go about solving the poverty crisis. Yet, it will take many years – even decades – to bring a country to economic prosperity. However, it can be done if the above causes are solved soon.