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Unpacking the Top Causes of Global Poverty

Poverty is a global problem that affects billions of people. The ways that different organizations, countries, and institutions define poverty may vary, but in 2023, an estimated 689 million people live on less than $1.90 per day.

Most people have some basic consciousness around the challenges of poverty, even though public perception is often tainted by misconceptions. One of the most overlooked facts about global poverty is that the number of people living in poverty has declined substantially within recent decades.

In 1990, about 36% of the world’s population lived in poverty. Today, that has been halved. Around 18% of the world currently lives in conditions of poverty. This is progress worth celebrating, while simultaneously acknowledging that it is still too high.

The decline of poverty in the past 30+ years can teach us many lessons. One critically important one is that we don’t have to think of poverty as an inevitable reality. The amount of people and places that have grown beyond the struggle to survive, even thrive, shows us that it is a problem with real solutions. We can continue to build on this progress. However, doing so sustainably and successfully will require an understanding of what causes poverty today.

Of course, there is not just one answer to this question. There are many causes of global poverty, and many of them are interrelated. It is impossible to know where one cause of poverty ends and another begins, because they all intersect one another. However, some of the most common include the following:

Climate change

Climate change is making it more difficult for people to grow food and make a living. This is especially true in developing countries, where people are more reliant on agriculture. Fully 80% of people living in extreme poverty are smallholder farmers who live off their land.

While many of the strides against poverty have taken place in cities and towns, poverty is still most pronounced among rural populations. About 8 in 10 people around the world living in poverty live in rural settings. This means they rely on agriculture for their survival, a livelihood that grows increasingly uncertain as the effects of climate change accelerate.

For example, droughts and floods caused by climate change have destroyed crops and forced people to leave their homes. Problems like soil depletion, irregular rainfall, and inadequate harvests are common. The increase of natural disasters also poses a major threat. Natural disasters such as floods, droughts, and earthquakes can destroy homes and livelihoods, leaving people in poverty and erasing progress that has been made. 

Adapting to climate change is non-negotiable if we are to continue our rate of progress against poverty. This will help to protect people's livelihoods and reduce the risk of poverty. This is why, as a community development organization, Plant With Purpose invests many resources in equipping farmers with skills in climate resilient agriculture. Practices like soil conservation farming and regenerative agriculture help to conserve resources like water, prevent soil runoff, and promote biodiversity, which in turn helps stimulate healthy ecosystems. When an ecosystem is in good health, the farms on it can remain productive, allowing the families who live there to access reliable food and income.

overcoming global poverty one savings group at a time

A lack of access to banks and financial services. 

People who lack access to financial services such as loans and savings accounts are less likely to be able to start or grow businesses, which can trap them in poverty.

In many rural villages around the world where poverty is high, banks do not operate. What this means is that there is nowhere for people to save their money. Many times, people will not make a habit out of saving. When an emergency strikes, like an accident or health crisis, these families will not have access to savings or loans to help cover the expenses. In some settings, loan sharks seek to take advantage of these situations, trapping families in debt with extremely high interest rates and creating further desperation.

Village savings groups, such as the Purpose Groups established by Plant With Purpose’s program essentially allow community members to become their own bank, creating access to savings and loans where they were previously unavailable. Plant With Purpose’s holistic approach also cultivates a sense of social solidarity among group members, allowing many to experience a sense of agency or a leadership opportunity for the first time.

A lack of access to education and employment opportunities. 

People who lack access to education and good jobs are more likely to live in poverty. This is because they have fewer skills and opportunities to earn a decent income. This is one of the most fundamental causes of global poverty. When people do not have access to education, they have fewer skills and are less likely to be able to find good jobs. This can lead to a cycle of poverty that is difficult to break.

Investing in education and job training can be a powerful part of a solution to poverty. This will give people the skills they need to earn a decent income. Plant With Purpose partners with schools across the world to start equipping the next generation, while also providing entrepreneurship training for their parents.

Inequality and marginalization. 

People who are marginalized or discriminated against are more likely to live in poverty. This is because they have fewer opportunities to participate in the economy and build a better life for themselves.

Promoting equality and opportunity helps to ensure that everyone has a fair chance to succeed.

The way inequality and marginalization manifests itself can be quite different and complicated across various parts of the world. By working with a locally based team, Plant With Purpose’s program can address the marginalization of various populations with a full understanding of the surrounding cultural considerations. For example, Plant With Purpose programs in Mexico have created opportunities for many indigenous populations who are among the most marginalized in country. In Thailand, the local team has helped refugee and ethnic minority populations secure citizenship rights.

Institutional corruption. 

Government corruption can prevent people from accessing basic services such as education and healthcare, which can lead to poverty.

While corruption on its own can be a very difficult matter to solve, ensuring that there are reliable opportunities for ordinary people to earn a decent living can be a great defense against the desperation that oftentimes drives people to participate in activities related to corruption.

teaching people agricultural techniques helps solve global poverty

Conflict and violence. 

War and conflict can displace people and destroy their livelihoods, leading to global poverty. This is especially true in developing countries, where people are more reliant on agriculture. For example, the Syrian civil war has displaced millions of people and caused widespread poverty.

At the same time, progress against poverty can also help reduce the likelihood of war. It becomes easier to stir up support for conflict when large portions of a population feel unsafe, threatened, insecure, or resource-scarce. Programs like savings groups or farmer field schools in Plant With Purpose’s program have helped former combatants realize better opportunities to build their communities, swaying them away from participating in violent activities.

Gender inequality. 

Women and girls are disproportionately affected by poverty. This is because they often have less access to education, employment, and resources. For example, in many countries, women are paid less than men for the same work. This can make it difficult for women to support themselves and their families.

Gender remains an integral part of Plant With Purpose’s approach. With an understanding of how things like the multiplier effect can help maximize its efforts, the organization supports women finding more opportunities to develop financially and personally.

These are just some of the primary causes of global poverty. It is important to understand these causes in order to develop effective solutions. By working together, we can create a world where everyone has the opportunity to live a decent life.

About the Author

Philippe shares the stories of people living at the forefront of the climate crisis, who are working to transform their ecosystems and communities. He loves emphasizing the human experience, and keeping conversations about the environment centered on the communities most affected by it. Philippe has led storytelling trips to Mexico, Thailand, Colombia, Tanzania, South Africa, Haiti, and a number of other countries. He has previously served in similar roles at Liberty in North Korea and Mobility International.

Philippe obtained a Bachelor of Arts in Communications, as well as a Bachelor of Arts in Global Studies at UC Santa Barbara. He furthered his studies by earning a Master of Arts in International Studies as well as a Master of Arts in Nonprofit Management at University of Oregon. Philippe is also an illustrator, podcaster, and digital artist. Outside of work, Philippe loves spending time with his wife and their three kids.

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