Supporting pro-poor growth processes: Implications for donors - ODI Briefing Papers 34 - Briefing papers

• Pro-poor growth requires attention on productive sectors and on developing an enabling environment • Strategies for pro-poor growth must be embedded in nationally-owned development plans • Donors must understand the political economy of pro-poor policy processes, and provide support that is long-term, predictable, flexible and responsive to country situations D espite rapid urbanisation in developing countries, most of the world’s poor live in rural areas. Thus, reducing poverty depends, to a large extent, on reducing rural poverty. Evidence suggests that increases in agricultural productivity are closely related to poverty reduction. However, whether or not poor rural people can access markets and services to identify and grasp opportunities greatly depends on the availability and quality of infrastructure and on the institutional environment. Pro-poor growth policies aim to boost economic development while paying attention to the interests of the poor and reducing poverty. For pro-poor growth to be sustainable over the long term, the pace and pattern of growth must be right. Growth must be sufficiently rapid and broadly based; the institutional setting must be conducive and growth must be inclusive and must aim at reducing both inequality and adverse incorporation. Such an approach must ensure that women are included in growth processes, that gender equity is addressed and that fundamental rights and freedom for women in the political, economic, social, cultural and civic fields are delivered. Pro-poor growth also needs to be environmentally sustainable. The state of the environment and the productivity of natural resources affect both the pace and pattern of growth. They are also important because poor rural households depend disproportionately on natural resources for their livelihoods. Pro-poor interventions need to consider the multiple risks poor people face and their vulnerability, i.e. their exposure to stress and shocks and their ability to prevent, mitigate, or cope with an event. Taking advantage of opportunities requires taking risks – growing new crops, engaging in new sectors, being entrepreneurial, migrating etc. Development policies, therefore, need to support poor people in risk prevention and mitigation by: • increasing their assets and capabilities; • supporting them to diversify their livelihood strategies; and • strengthening coping strategies that reduce vulnerability to risk and stress. Increased recognition of this has seen publicly provided social assistance programmes, in the form of public works schemes, transfers or subsidies, gain in importance. There is no blueprint for poverty reduction, and each country needs to identify the mix of economic and social policies that best suit its own context. This also applies to how donors interact with partner countries. Nevertheless, there are some general guiding principles for how donors should relate to partner countries, and which sectors with a potentially large propoor impact should be given more attention by both governments and donors. This Briefing Supporting pro-poor growth processes: Implications for donors