The yawning income gap in the country has been evident for a long time; the rich keep getting richer and the poor, poorer. A World Bank study released yesterday validated this observation, as it stressed that reducing inequality is critical to becoming a middle-class society free of poverty.
While poverty has been reduced from 49.2 percent in 1985 to 16.7 percent in 2018, the World Bank study showed that the Philippines has one of the highest rates of income inequality in East Asia. “The top one percent of earners together capture 17 percent of national income, with only 14 percent shared by the bottom 50 percent,” the World Bank reported.
The COVID pandemic aggravated the problem. Unemployment surged and economic growth was derailed. The World Bank said the pandemic partly reversed gains achieved over several decades in cutting poverty and narrowing inequality. It noted that the poor have yet to fully recover from the economic burdens arising from the pandemic, and now spiraling food prices are aggravating hunger.
“The report says that inequality starts even before birth and is perpetuated over the life cycle. It starts with maternal nutrition and health during pregnancy. Differences continue into childhood, where disparities in access to health care, proper nutrition, safe drinking water, sanitation, and quality education determine the extent to which a child’s human capital develops,” the World Bank declared.
To reduce inequality, the World Bank is calling for policies that boost employment and rural development, improve access to and quality of education as well as strengthen social protection.
Last year as the pandemic continued to rage, the World Bank noted that the national poverty rate surged to 18.1 percent despite government ayuda or cash dole-outs and other forms of assistance. Scars from the pandemic can be healed, the WB said, by pushing greater vaccine booster uptake, overcoming the learning loss after two years of remote learning, taming inflation, and strengthening social assistance and unemployment insurance programs for the informal sector.
For a vibrant recovery from the pandemic, the World Bank highlights the importance of reskilling of workers, encouraging entrepreneurship, increasing women’s participation in the workforce as well as boosting agricultural productivity.
Equal opportunities must also be promoted, the World Bank said, through heightened access to quality health care, education and housing, with special emphasis on reaching underdeveloped regions and “people disadvantaged… because of the circumstances of their birth.”
Many of these suggestions have been discussed by various administrations over the years, but this is a society where the tiny elite thrives on the status quo that keeps the majority undereducated and impoverished or borderline poor. Whether a new administration headed by a member of the elite will make a difference remains to be seen.