Government policies in Sri Lanka and elsewhere keep poor at bottom end

SINGAPORE, September 18, 2006 (LBO) – The World Bank rapped politically hungry governments saying short sighted policies fail to uplift the poor, keeping them at the ‘bottom end of the pyramid’. It’s a bad cycle. When projects are scaled up, they bump against the governments which failed their people in the first place, which is quite unfortunate, Devarajan adds. The bank’s chief economist for South Asia, Shantayanan Devarajan also ticked off businesses for not doing enough to increase market opportunities for the poor in Asia, in both formal and informal markets.

When markets fail the poor, the government should speedily correct it. But governments also fail due to various short sighted policies, Devarajan said addressing businessmen, policymakers and civil society here.

He cited Sri Lanka’s cash transfer programme, Samurdhi, as a classic example of a poorly targeted redistribution programme that is often misused as a political tool.

“In my country, Sri Lanka, Samurdhi excludes 40 percent of the poor, while 44 percent of its beneficiaries are not poor,” says Devarajan.

The way out perhaps, he says, is for businesses to step in, using technology to create