Backed by sound economic policies and until the global crisis, a buoyant global economy, many developing countries made significant movement toward achieving the 2015millennium Development Goals (MDGs), particularly those for poverty reduction, gender parity in education, and reliable access to safe water. But even before the global economic crisis, progress in achieving some MDGs, especially those on child and maternal mortality, primary school completion, hunger, and sanitation, was lagging. The global food, fuel and economic crises have set back progress to the MDGs.

In the last two decades, across a range of countries high growth rates have reduced poverty but have been accompanied by rising inequality. This paper is motivated by this stylized fact, and by the strong distributional concerns that persist among populations and policy makers alike, despite the poverty reduction observed in official statistics where growth has been sufficiently high. This seeming disconnects frames the questions posed in this paper. Why the disconnect, and what to do about it?

This paper reviews the evidence about the effects of urbanization and cities on productivity and economic growth in developing countries using a consistent theoretical framework. Just like in developed economies, there is strong evidence that cities in developing countries bolster productive efficiency. Regarding whether cities promote self-sustained growth, the evidence is suggestive but ultimately inconclusive. These findings imply that the traditional agenda of aiming to raise within-city efficiency should be continued.

The objectives of the Costing Adaptation through Local Institutions (CALI) study were (a) to identify the costs of adaptation through local institutions, and (b) to investigate which institutions help households adapt to climate variability, which efforts and costs are needed to realize the adaptation options, and how they facilitate adaptation to climate variability. The study was carried out in Ethiopia, Mali, and Yemen. This report discusses the results for Yemen.

This paper explores how a 'conflict and violence sensitive' framework in project assessment, design and implementation facilitates early identification and mitigation of negative consequences of competition and dispute, and promotes sustainable development over the longer term. It discusses the role of renewable resources in perpetuating conflict and violence, and distills lessons from selected development programming experiences in managing conflict risks associated with these dynamics.

Local and Community Driven Development (LCDD) is an approach that gives control of development decisions and resources to community groups and representative local governments. Poor communities receive funds, decide on their use, plan and execute the chosen local projects, and monitor the provision of services that result from it. It improves not just incomes but people's empowerment and governance capacity, the lack of which is a form of poverty as well. LCDD operations have demonstrated effectiveness at delivering results and have received substantial support from the World Bank.

Although Mozambique has considerable agricultural potential, rural poverty remains extremely high. This paper examines the extent to which global and domestic price distortions affect agricultural production and national poverty. The author develops a computable general equilibrium (CGE) and micro-simulation model of Mozambique that is linked to the results of a global model. This framework is used to examine the effects of eliminating global and national price distortions.

South Africa has rapidly reduced trade barriers since the end of Apartheid, yet agricultural production and exports have remained sluggish. Also, poverty and unemployment have risen and become increasingly concentrated in rural areas. This paper examines the extent to which remaining price distortions, both domestic and foreign, are contributing to the underperformance of the agricultural sector vis-a-vis the rest of the economy. The author draws on a computable general equilibrium (CGE) and micro-simulation model of South Africa that is linked to the results of a global trade model.

Although economic reform has brought remarkable progress in poverty reduction in Vietnam, the scale and depth of ethnic minority poverty in Vietnam presents one of the major challenges to achieving the targets for poverty reduction set out in the Socio-Economic Development Plan, as well as the millennium development goals. The authors first review a series of monetary and non-monetary indicators which show the living standards of the ethnic minorities are improving but still lag seriously behind those of the majority Kinh-Hoa.

Using recent estimates of industry assistance rates, the effects of trade liberalization in the rest of the world and in Pakistan alone are analyzed using a global and a Pakistan computable general equilibrium (CGE) model under two tax replacement schemes: a direct income tax and an indirect tax replacement. The results indicate that the distributional and poverty effects in Pakistan of a unilateral liberalization of all traded goods are significantly greater than the effects of trade liberalization in the rest of the world.

A general equilibrium modeling approach is used to estimate the effects within Indonesia of unilateral and global trade liberalization, including effects on poverty incidence. It is concluded that global reform of trade policy in all commodities is a significant potential source of poverty reduction for Indonesia. The poor rural and urban have a strong interest in global trade policy reform. If Indonesia were to liberalize unilaterally, poverty incidence also will decline but the effect is small.

This review of public expenditures on Social Protection (SP) in Nicaragua is based on the analytical framework of Social Risk Management (SRM) developed by the World Bank. The concept of managing social risk comes from the notion that certain groups in society are vulnerable to unexpected shocks which threaten their livelihood and/or survival. Social protection focuses on the poor since they are more vulnerable to the risks and normally do not have the instruments to handle these risks.