Strong Evidence of Impact Shows Need to Scale Up Efforts
WASHINGTON, Nov. 20, 2024 - Economic inclusion programs are cost-effective and impactful but are reaching only about one-in-ten people living in extreme poverty, according to a World Bank report released today.
Economic inclusion programs-which provide cash transfers, skills training, business capital, coaching, and market access-build a ladder out of poverty for the poorest and most vulnerable people, particularly women. While programs are rapidly expanding, The State of Economic Inclusion Report 2024: Pathways to Scale shows they reach only 10% of the approximately 700 million people living in extreme poverty, or just over 70 million people across 88 countries.
The report by the Bank's Partnership for Economic Inclusion highlights the importance of improving program quality and impact through evidence-based design and effective monitoring, evaluation, and learning. Governments lead the scale-up, but collaboration with non-governmental and community-based organizations and the private sector is critical to overcome capacity constraints.
"There is strong evidence of the significant impact that economic inclusion programs have on food security, consumption and income," said Iffath Sharif, Global Director for Social Protection at the World Bank. "When implemented through government systems, these programs can be highly cost-effective and yield high returns on investment."
The report examines the coverage of economic inclusion programs, documents evidence of progress, and shares country examples. In Zambia, for instance, an economic inclusion program for women led to a 19% increase in consumption, a 45% rise in business profits, and cost recovery within 12 months. A program in Niger increased consumption by 15% and doubled business revenue for women.
In July at the G20 Global Alliance Against Hunger and Poverty in Brazil, the World Bank announced an ambitious goal to reach 500 million people with social protection measures by 2030. This includes supporting 250 million women with social protection programs, focusing especially on the poorest and most vulnerable. Scaling economic inclusion programs will be essential to this effort. The Bank is already working with 42 countries to deliver comprehensive economic inclusion programs through their social protection systems.
"Economic inclusion programs have the potential to address critical development challenges by empowering women economically and reducing youth unemployment," said Victoria Strokova, Program Manager, Partnership for Economic Inclusion at the World Bank. "But to realize that promise, more intentional design and delivery are needed. For example, while 90% of programs target women, only one-third deliberately focus on women's economic empowerment. We can further enhance these programs to overcome the social norms, the unpaid care work, and other barriers that prevent women from fully participating in the economy."
The report suggests more programs be designed to tackle the legislative and regulatory barriers women face. And while two-thirds of programs target youth, wage employment opportunities could be enhanced through skills training, apprenticeships, and job placement partnerships with employers.
The report also cites climate resilience as a new frontier for economic inclusion efforts. It finds that two-thirds of economic inclusion programs are integrating climate resilience practices to help people adapt to environmental challenges. This includes innovative approaches such as climate risk insurance and low-cost green technologies.
