The report highlights the impact that economic engagement has had on global poverty reduction. The report notes that the countries showing the greatest progress are those that are “allowing market prices to balance supply and demand and to allocate scarce resources, and pursuing sensible and strategic economic policies to spur investment, trade and job creation.” This economic growth is attributed to several factors including an investment boom triggered by rising commodity prices, high growth spillovers originating from large open emerging economies, diversification into novel export markets, spread of new technologies, increased public and private investment in infrastructure, the cessation of a number of conflicts and improved political stability, and the abandonment of inferior growth strategies.
The Yale report suggests that the poverty rate is being reduced faster than ever before. The rates of poverty reduction outlined in the report suggest that “the rise of globalization, the spread of capitalism and the improving quality of economic governance” have led to diversified and expanding economies around the world. Developing countries have sustained average economic growth rates of approximately five percent a year since 2003, around double the rates of growth in the developed world.
Within the next ten years, it is projected that seven of the ten fastest growing economies in the world will be in sub-Saharan Africa. These rapidly emerging markets are economic opportunities that the U.S. cannot afford to ignore. As economic growth is lifting millions out of poverty, it is also mitigating the conditions which foster instability, unrest, and conflict. As this report suggests, economic engagement with developing countries is a smart strategic investment for the U.S. and makes the world safer and more prosperous.