Mr Chairman,
Your Excellencies,
Honorable Governors,
Mr President of IFAD,

I wish to extend to the Council, the Executive Board and to President Al-Sultan, my congratulations for steering the Fund towards new successes as it celebrates its twentieth anniversary.

After leaving IFAD, I have been able to further indulge my urge to improve insights into poverty processes in ACORD, the international consortium of development NGOs I now lead.

Today, I will share with you some of the lessons I have learnt. These have to do with the genesis, content and social consequences of poverty and with some of their policy implications.

The evolving genesis of poverty:

Much has been said on this (genesis of poverty). I remember that, at the first UNCTAD, emphasis was on the exogenous factors and the inter-governmental remedies.

The pendulum under neo-liberalism is now on engineering behavioural changes in the developing countries themselves. This is on the assumption that poverty processes are essentially home-grown and that markets need not be inimical to the poor.

The balance problably lies somewhere between these two positions but all too often selected causes are emphasised on the basis of preferred remedies.

In the context of Nation-States, we explained the genesis of poverty in terms of scarcity, access to resources and income distribution.

We now need to look urgently at the emerging dynamics of poverty in a globalised world.

Parts of Asia and some time ago parts of Latin America, have witnessed in the wake of financial crises a hollowing-out of what was a thriving middle class. Hailed achievements in poverty eradication are being reversed. The plight of the unskilled in particular is becoming dramatic. New distortions are brought about by the skewed income distribution effect of concentrated injections of massive external financial support for bailing out the banking system. This is happening at a time when official aid for poverty eradication is shrinking.

In Africa, confronted by corporate integration in the North, a process of disintegration from the national economy is affecting the extractive sector as it is sucked into the transnational ambit. New partnerships are in the making between local elites or war-lords, the extractive sector and the corporate North. Little space is left for the emergence of a middle-class while poverty and marginalisation worsen.

The misconceptions about the contents of poverty:

There does not seem to be clear agreement on the contents of poverty in spite of the widespread rhetorical commitment to combating it.

Absolute poverty is not just about greenbacks. I doubt that it can be encapsulated in the definition of "less than one dollar a day". One thing the IFAD team and I asserted was that, even in its material dimension, this is a narrow demand-side approach to the poor. It has led to the policy of "going for growth" by partnering on the supply-side only those with high apparent potential. What was left for the poor were social "safety nets" to meet their basic survival needs. This, we said at IFAD down-played the factors that keep so many people at the bottom of the heap. It also deprived the poor of the recognition of their productive potential.

IFAD resolved at the time to initiate an increasing percentage of the projects it funded. It did this for the specific purpose of partnering the poor on the supply-side rather than to co-finance projects where poverty alleviation was simply bolted on as an afterthought.

What the ACORD team and I now assert with no less emphasis is that the debate should be further broadened to non-material forms of poverty. These may hit people the hardest. Thus poverty is also the denial of basic rights of people to participate in decisions affecting their lives. Poverty is the denial of equality between women and men in the broadest social sense, as enunciated by the IFAD initiated Geneva Summit of 1992 on the Economic Advancement of Rural Women. Poverty is exposure to the loss of lives and trauma of those for whom natural calamities or conflicts are a near-continous fact of life.

These non-material forms of poverty add vulnerability to destitution and lead to further impoverishment. The aspirations of the poor are destroyed and as their coping strategies collapse, the "dependency syndrome" sets in. At that stage, there may be no other option in the short term except to revert to the demand-side "dollar a day" approach to poverty. But are not the seeds of the crisis inherent in the diagnosis itself?

The social impact of poverty:

Some claim that there is no causal relationship between poverty and violence. In support of this position, it is stated, rightly, that the prevalence of abject poverty may co-exist with social peace in some cases while in others, violence erupts while poverty is relatively less acute. I believe that this does not invalidate the above causal relationship. To my mind the difference between the two scenarii has to do with the strength of civil society.

Vibrant civil societies tend to mitigate marginalisation and to blur the edge of conflict. In a way, people in these societies are poor in dollar per capita terms only but have a kind of wealth that classical economists cannot capture. Long before Fukuyama, Loury (1977) called it "social capital". This concept encompasses values of trust, solidarity, reciprocity and harmony.

Where on the other hand contemporary history has broken these time-honoured practices, where society is riven by conflicting allegiances to competing power-brokers,where as it were "verticality" replaces "horizontality", the impact of poverty in dollar terms is compounded by deprivation of "social capital".

More likely than not violence then ensues. It offers opportunities for new forms of destabilisation where chaos is manipulated by special interest groups to carve out a new political economy subservient only to themselves.

Unlike the current Asian financial crisis which elicited an amazing fund-raising capacity by OECD Governments, no such response is on offer for the least developed countries of Africa. There is it seems an under-estimation of the cross-border destabilisation impact of acute poverty or of its "fall-out" to use an appropriate nuclear analogy.

Some policy implications:

I will cite briefly two areas worthy of further investigation.

First a whole new area of research on the dynamics of poverty the context of globalisation is called for. Understanding the effect of financial crises on the poor, introducing a poverty impact assessment in policy-responses to current financial crises are priority areas of investigation. This might warrant an up-dating by IFAD of the State of World Rural Poverty for the Year 2000.

Second the debate on liberalisation revolves around the relative importance of two stakeholders, the State and the Market. This leaves out the third and most important stakeholder group, the members of civil society, the latter being itself the depository of the social capital of a Nation.

For poverty to be eradicated, institutional change must occur involving a redefinition of the role of the State in relation to the other two actors. Beyond creating an enabling environment for the market, States should promote the vibrancy of civil society.

This they cannot do without the cooperation and support of NGOs and community-based organisations.

The UN system itself should become more people-centred in keeping with the "We the peoples of the World..." opening proclamation of the UN Charter. What is called for goes beyond the current rhetoric about cooperation where NGOs simply implement projects defined by the UN agency concerned.

I therefore urge Governments on the one hand to support the earmaking of official development assistance for NGO projects. The acceptance of the Government of Bangladesh that IFAD loans be put at the disposal of such successful NGO initiatives as BRAC or the Grameen Bank proves the validity of this choice.

I urge on the other hand, the UN system to fund-raise and set aside additional resources that can be channelled to the best NGO projects and programmes initiated through grass-roots participatory procedures. IFAD with its ECP has already made a first step in this direction.

More can be done in the light of the experience of the European Union which has earmarked substantial funding for NGO programmes in the developing world and for supporting civil society on the Southern shores of the Mediterranean. In spite of some administrative weaknesses, these systems have demonstrated the valuable contribution multilaterals can make to upholding civil society's efforts to combat poverty.

Perhaps once again in this domain, IFAD will lead the way.

How far and how soon we can make strides towards the elimination of poverty, one of the main causes of violence on the eve of the new millenium, depends squarely on our collective commitment to forge a strong partnership among all stakeholders. A partnership with the NGO community as its binding force.