Social Watch launches 2011 Basic Capabilities Index

Economic growth does not ensure human well-being. Far from improving the quality of life of the world population, increased trade and per capita income have not resulted in reduced poverty, according to the most recent Basic Capabilities Index (BCI) published by Social Watch, an the international network of civil society organizations.

The index was launched on Friday 14, in the Netherlands, on the eve of the international days against hunger and poverty. October 16 commemorates the creation of the United Nations Food and Agriculture Organization (FAO) and October 17 is international poverty day.

Global trade and average per capita income have grown faster in the first decade of the 21st century than the decades before, but progress against poverty slowed down. World exports multiplied almost five times between 1990 and 2010 and income more than doubled, but the world average BCI only increased by one tenth in those same 20 years.

Macroeconomic performance and human well-being do not go hand in hand, concludes Roberto Bissio, coordinator of Social Watch.

The countries where the social situation is most critical are Chad, Sierra Leone, Niger, Somalia and Guinea Bissau, all of them in Africa. Afghanistan was the worse positioned ten years ago, but there are no reliable data to compute its BCI in 2011.

The index “shows that the last decade was a lost decade in the fight against poverty, in spite of the excellent performance of emerging economies,” commented Bissio. The gap between the slow progress in social indicators and the rapid growth of world trade and per capita income is explained “by growing inequalities in distributing the benefits of economic prosperity”, he added.

The BCI is based on key indicators that measure essential aspects of survival and human dignity: mortality among children under five, reproductive health (measured by births attended by skilled personnel), and primary education (school enrolment, proportion of children reaching fifth grade and adult literacy rate).

The available figures do not allow to assess the whole impact of the crisis that started in 2008, because social indicators are gathered and published much slower than the economic numbers. Yet, Social Watch member organizations have already verified in their countries that the most vulnerable sectors of the population are the ones carrying the largest burden of the crisis.

Before the crisis, gross income was growing fast while progress in education, health and nutrition was already too slow. If industrialized countries enter into a prolonged period of stagnation or recession, the situation of the most vulnerable sectors at global level can only become worse.

The boom and the busted

“The hard numbers have proved that prosperity does not trickle down,” said Roberto Bissio, coordinator of Social Watch, at the launch of the Basic Capabilities Index computed by this non-governmental watchdog organization. ”It used to be common sense that a growing economy benefits the poor, that a rising tide will lift all boats, big or small, or that the pie has to grow first before we can share it,” he added, but the figures published by Social Watch on the eve of the international days on hunger and poverty seem to show the opposite.

Progress on education, health and nutrition was slower after the year 2000, when global economies were booming than in the previous decade. “And now the most vulnerable people and countries will suffer disproportionately from global economic stagnation,” Bissio explained at the launch of the index in the Netherlands. The Basic Capabilities Index (BCI) is a composite measurement developed by Social Watch to assess poverty according to social performance, without using income as a yardstick.

The average world per capita income more than doubled between 1990 and 2011 and the World Bank claims that the percentage of persons living with under one dollar per day (or $1.25 when adjusted for inflation) was cut to half between 1980 and 2005. But the basic indicators of child mortality, attended births and primary education measured by the BCI showed slower progress during the prosperity that followed the year 2000 than in the previous decade.

Since social indicators are gathered and published much later than the economic numbers, the BCI 2011 does not assess yet the whole impact of the economic and financial crisis that started in 2008. Yet, Social Watch member organizations are reporting that austerity measures being put in place as a response to the crisis are affecting disproportionately the most vulnerable sectors.

“Economic inequality explains why the gains are appropriated by a few during the boom,” says Bissio, “and the concentration of power that results from this inequity ensures that the losses are socialized during the crisis, thus widening the gap even more.”

The countries holding the top positions in the list according to BCI values this year are Japan, Norway, Netherlands, Switzerland and Iceland. The countries that rank worse in the BCI 2011 are all African: Chad, Sierra Leone, Niger, Somalia and Guinea Bissau. In 2000 the worse positioned was Afghanistan but due to lack of reliable date no ranking is provided for this worn-torn country this year.

By region, the figures for Latin America, East Asia, the Middle East and North Africa, show a significant slowing down when comparing the first decade of the 21st century to the previous one. Only marginal change has been registered for Europe and North America, but the index in those regions is already very close to the theoretical maximum of 100 per cent.

On a positive note, Sub-Saharan Africa, departing from very low levels, registered slightly higher increments in BCI levels in the period 2000-2011 compared to the previous decade.

Between 1990 and 2011, the number of countries with a BCI level considered “critical” decreased from 42 to 28. Benin, Cameroon, Eritrea, Ghana, Kenya, Malawi, Rwanda, Tanzania and Togo (in Sub-Saharan Africa); Guatemala (Latin America); Djibouti, Egypt, Morocco and Yemen (Middle East and North Africa); Laos and Myanmar (East Asia); and Bhutan and India (South Asia) have moved up from “critical” to “very low”.

The number of countries with medium BCI levels increased from 44 in 1990 to 52 in 2011. Countries that have moved one level higher are, among others: Algeria, Iran, Kuwait, Saudi Arabia, Syria and Tunisia (Middle East and North Africa); Azerbaijan, Tajikistan, Maldives and Vietnam (Central, South and East Asia); and Belize, Brazil, Colombia, El Salvador, Mexico, Paraguay, Peru and Suriname (Latin America). El Salvador registered the highest increase in BCI in this group: 17 points during this period. In contrast, countries such as Ukraine, Bosnia and Herzegovina, and Thailand have moved down from basic BCI to medium level.

Nineteen countries registered low BCI levels in 2011. Bolivia, Honduras and Nicaragua (in Latin America), and Cape Verde, Zimbabwe and Swaziland (in Sub-Saharan Africa), among others, improved their standing from very low/critical to low BCI level. Within this group of countries with low BCI levels, Bhutan in South Asia recorded the highest increase of 28 points, climbing up from critical to low BCI level.

BCI is based on key capabilities that are essential for survival and human dignity. It is made up of basic indicators that are used to measure the United Nations Millennium Development Goals: mortality among children under five, proportion of births attended by skilled health personnel, and a combination of enrolment in primary education, the proportion of children reaching fifth grade and the adult literacy rate.

A lost decade in the fight against poverty

The first decade of the 21st century was a lost decade in the fight against poverty, in spite of the excellent performance of the emerging economies, said Roberto Bissio, coordinator of Social Watch, on the eve of the international days on hunger and poverty.

Social Watch, a network of citizen organizations monitoring social policies around the world launched today a Basic Capabilities Index derived from well-being indicators which slows very slow progress in the last twenty years. This index contradicts the assessment of the World Bank, according to which extreme poverty would have halved around the world between 1980 and 2005.

“By looking at basic well-being indicators like malnutrition, child delivery and primary education instead of focusing on income, the BCI is closer to reality than the one-dollar-a-day line of the World Bank”, claims Bissio. The world average inhabitant doubled her income from 4.079 dollars in 1990 to 9.116 dollars in 2011 but the world Basic Capabilities Index barely increased in these twenty years from 79.3 to 87.1 points. A slowdown was registered during the first decade of the 21st century, when the index moved up three points, while progress amounted to five points between 1990 and 2000.

The index computed by Social Watch merges mortality among children under five, which relates strongly with malnutrition, the proportion of births attended by skilled health personnel, and primary education data.

The figures do not allow yet to assess the whole impact of the crisis that started in 2008, since social indicators are gathered and published much slower than the economic numbers. Yet, Social Watch member organizations have already verified in their own countries that the world’s most vulnerable sectors are indeed the ones carrying the largest burden of austerity measures.

Before the crisis, gross income was growing fast while progress in education, health and nutrition was advancing slowly. If industrialized countries enter into a prolonged period of stagnation or recession, the situation of the most vulnerable sectors at global level can only become worse.

The countries holding the top positions in the list according to BCI values this year are Japan, Norway, Netherlands, Switzerland and Iceland. The worst ranked countries are all in Africa: Chad, Sierra Leone, Niger, Somalia and Guinea Bissau.