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Transport and Poverty Reduction

 

Developing country governments have long given high priority to infrastructure, both in policy and in
investment. This emphasis continues in national poverty reduction strategies. Where there have been consultations with poor people, transport infrastructure and services have been prioritised.
Infrastructure services – not simply the ‘hardware’ but also the associated institutions and, most importantly, the outcomes for people – should be given their proper weight in the poverty agenda where national priorities are central.
 
A review of a range of national Poverty Reduction Strategies shows recognition of the link between poverty and transport infrastructure and services in general terms, but a tendency to treat them separately, with different strategies and timescales. Major or national road infrastructure is often considered in isolation of rural access and mobility, which in turn is usually completely divorced from the provision of local services for poor people.
 
It is believed that only through a synthesis of these agendas, and a focused effort to identify and tackle the problems that have undermined them in the past, will the Millennium Development Goals (MDGs) be achieved. Transport infrastructure and services, although not specifically cited, play a vital role in enabling or constraining achievement of most of the MDGs.
 
Just as there is no sense in developing feeder roads in the absence of trunk roads, so it will not work to pursue economic growth that has minimal impact on poverty reduction, or to focus purely on direct benefits for the poor when the wider environment in which they seek to secure a livelihood remains hostile or degrading. Similarly it is pointless investing in roads when the provision of transport services is severely constrained due to lack of knowledge, investment, and support for what will always be an imperfect market. Roads may not be the only solution when judicious siting of educational, health or support services may reduce the road network or seasonal transport demands (RAP).
 
Reliable data are hard to obtain, but estimates indicate that approximately 70% of infrastructure investment in developing countries is financed by governments or public utilities from their own resources or from non-concessional borrowing, with less than 5% coming from official development assistance and the remainder from the private sector. (These statistics neither capture the contribution of the local private sector nor of users.)
 
In the least developed countries, however, official development assistance greatly exceeds foreign private capital flows. Since governments are likely to continue to be the main investors, the focus for development agencies should be on supporting them. It is clear that governments often
need to reform their transport infrastructure policies with closer consultation between the various rural sector interests. Development agencies can also help to make the links with local and international private partners, including the informal sector, and users themselves, to work with government for better services.
 
But the private sector may not always have a role in all sector activities. In some cases, public sector reform will be the most realistic and politically acceptable choice. For their part, development agencies need to reverse the decline in assistance. Current investment in infrastructure falls far short of even conservative estimates of what is needed.
 
One billion of the world’s population still have no access to safe drinking water, and more than twice that number of people lack appropriate sanitation or access to clean energy sources. Over one billion people have no access to all-weather roads.
 
 Investment choices have often been distorted by political or personal interests, developed without rigorous investigation or based on limited knowledge sources, and without strong systems or procedures to scrutinise them. There has often been a bias towards large-scale capital projects, and neglect of institutional issues, maintenance, and stakeholder consultation. Transport services; which are often provided by the private sector, struggle to provide the essential rural mobility for lack of an ‘enabling environment’.
 
We need to overcome these problems by focusing on stakeholder involvement in the decision making and investment processes to mobilise all feasible human, material, enterprise and financial resources in what will be a ‘limited resource environment’ for the foreseeable future. There needs to be accountability, capacity-building and full consideration of environmental issues.
 
For transport infrastructure to make a direct contribution to poverty reduction, various preconditions must be fulfilled. Lack of access to transport infrastructure must actually be a decisive bottleneck that prevents poor people from offering their goods on markets, sending their children to school or going to a health station in an emergency. When other reasons are decisive, such as insufficient production of goods or food, child labour as a prerequisite for food security for the family, lack of funds to pay for treatment at a health centre, lack of transport services, then an improved transport infrastructure alone will be of little help. Additional or alternative measures to increase poor people's income must then be taken into consideration. It must also be assured that the newly-created infrastructure will be maintained and that appropriate means of transport and transport services such as small lorries, buses, trishaws, motorcycles, bicycles, etc – are available or will be made available. In addition, reductions in transport costs that are achieved through improved transport infrastructure must actually reach poor people and must not be absorbed by intermediates such as transport enterprises or middlemen holding quasi-monopolies. The same applies to new employment opportunities. Local resource based technologies can involve local people and help to bring skills and jobs to the communities. Appropriate and affordable standards and specifications and road surfaces must be adopted. In too many incidences investments have been wasted on unnecessarily wide roads or surfaces that demand high imported materials or equipment inputs when local resource based solutions are cheaper and have many poverty reduction benefits.

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Updated September 2010