IED Formatted

Title
Abstract
The paper analyses the economic growth, poverty conditions and Human Development
Index values and growth rates in selected South – East Asian countries - Philippines,
Myanmar, Hong Kong, Vietnam, Taiwan and Indonesia. The source of data for the economic
growth and poverty conditions of the countries were obtained from World Bank databases
while data for the HDI values were obtained from UNDP reports. The paper makes several
interesting conclusions. In terms of HDI, Hong Kong is a clear leader, not only among these
five countries, but also on the global scene. With a HDI value of 0.917, an average annual
HDI growth rate of 0.64% and a current ranking of 12, Hong Kong has set an example for the
rest of South – East Asia. Indonesia’s and Vietnam’s proximity and similar political structure
makes them comparable in terms of their HDI rankings as well as their HDI growth rate.
Among the five countries discussed, Philippines’ HDI growth rate of 0.61% does not bode
well. Meanwhile, Myanmar has shown signs of steady development. It boasts of a
mammoth 1.83% HDI growth rate, far ahead of its neighbours. Although all the countries
belonged to South East Asia, the levels of poverty are very different in each nation.
Considering the percentage of population who are below the poverty line, Myanmar and
Vietnam have shown a steady decline in the poverty headcount ratio. Indonesia, on the
other hand, has not. Hong Kong and Taiwan have almost eradicated poverty while
Philippines is slowly reducing its poverty headcount ratio. One of the common feature of
poverty eradication measures is a strong political willing, as poverty alleviation measures
require lots of public spending and social welfare schemes which can come into full effect
only when government is keen to fight poverty.
Literature Reviews:
Sudarlan (2015), Contribution Of Human Development Index On Per Capita Income
Growth And Poverty Alleviation In Indonesia. Journal: International Journal Of Scientific &
Technology Research Volume 4, Issue 08, August 2015.
The aim of this research paper was to comprehend the relationship that existed between
Human Development Index and per capita income and poverty alleviation in Indonesia.
Cross-sectional data from 30 different provinces from the period 2002-2011 were collected
and utilised. Sudarlan concluded that growth of per capita income was not significant in
affecting poverty headcount, gap and severity. Inflation, was found to have a positive and
statistically significant effect on poverty headcount, but contrary to many hypotheses, did
not significantly affect the poverty gap and severity. Unlike inflation, education had a
positive effect on poverty headcount, gap and severity. And surprisingly, health was found
to have a statistically significant positive effect on only the poverty severity, but no
significant effect on the poverty headcount and gap.
The government of Indonesia is thus obliged to suppress the high rate of inflation in
Indonesia. The fact that economic growth measured by PC Income growth which is
statistically insignificant means that economic growth was only due to a small group of high
income people.
Martin Ravallion (2001), Growth, Inequality and Poverty: Looking Beyond the Average.
Journal: World Development Vol.29, No. 11, pp 1803-1815.
Ravallion in this celebrated paper aimed to assess the impact of gains of the rising aggregate
affluence on the poor in developing countries. The paper aimed to verify the claims that the
poor benefited in all cases and in all developing nations. The author concluded that there
was credible and sufficient information that the poor indeed benefited from the rising
aristocracy.
But, there were big variations between countries in how much the poor share in economic
growth, and in the final effects on the poor in a given country. Data problems shroud the
attempts at cross country correlations. Deeper micro – empirical work was found lacking on
the topics of growth and distributional change. Only then can one conclude and fine-tune
the policies and programs that are required to supplement growth – oriented policies.
Iman Sugewan et al (2010), The Impact of Inflation on Rural Poverty in Indonesia: an

Econometric Approach. Journal: International Research Journal of Finance and Economics.
The research aimed to analyse the impact of inflation on poverty in national, urban and
rural levels. It also aimed to assess the weightage of each group of product commodity
inflation to poverty level and the magnitude of its impact on rural and urban poverty levels.
The elasticity and the “Price Index of the Poor” – PIP – were calculated using the basic
consumer demand theory. The study could have been extended to examine the effect that
inflation had on certain sects of the poor. Also, more econometric methods could have been
used to obtain further conclusions.
The research made some interesting conclusions. Using linear regression, they concluded
that rural poverty was much more susceptible to economic shocks and inflationary surges.
Not only that, but the PIP calculated suggested that in the last few years, the non-poor
household had a smaller problem arising from inflation than the urban and rural poor
household.
Mark McGillivray, “The human development index: Yet another redundant composite
development indicator?” World Development Volume 19, Issue 10, October 1991, Pages
1461-1468
This paper by Mark McGillivray analyses whether the human development index (HDI) as
proposed by the United Nations Development Program is a useful indicator of development
across countries. The paper uses public domain data and uses simple statistics to analyse
the data. The paper argues against both, the composition as well as the usefulness of the
Human Development Index. The compares HDI with both, its own results, as well as those of
previous development indicators. The paper concludes that HDI is not only wrong in its
composition of factors (GNI per capita, Mean and Average years of schooling and Life
Expectancy at birth) but like many other indices before it, it fails to measure intercountry
development and inequality and hence cannot give a completely fair judgement of the
development levels. The paper also concludes that HDI does not provide any insight that
simple GNI ranking cannot.
Niels Lind, Values Reflected in the Human Development Index Author(s):

This paper examines the sensitivity of HDI to changes in its components, namely social
indicators of education, longevity and standard of living. The HDI is compared with the Life
Quality Index(LQI). It also considers what the HDI ranking means to a country. It is found
that, HDI’s weighting of the gross domestic product is in good agreement with people’s
preferences as revealed in the LQI. It shows how that a change in one of the components of
HDI affects the overall value for a developing and developed country in a different way. It
was found that the HDI growth of developed countries is very low when compared to the
HDI growth of developing country. It was also found that, HDI places a larger weight on
education than required. Literacy is accorded very high weight in the HDI, but its measure is
unreliable. It concludes that the HDI ranking of highly developed nations is so close and so
uncertain that is meaningless. The methodology used was statistical and differential
equation analysis. The source of data used was The Human Development Report, United
Nations Development Program(UNDP).
Economic Growth in East Asia Before and After the Financial Crisis by Barro R. J.
The purpose of this study conducted by Barro was to focus on the immediate and long term
effects of the East Asian Financial Crisis on the economic performance of the affected East
Asian countries. The study is conducted by splitting up the ten economies into two groups,
one consisting of countries with currency depreciations of more than 50% and the other
consisting of countries with currency depreciations of less than 25%. A regression was
performed using the ratio of total trade, exports plus imports, to GDP as the independent
variable, with Log(per capita GDP), Male upper-level schooling, Log(life expectancy) ,
Log(total fertility rate), Government consumption/GDP, Rule of law index, openness
measure, inflation rate, growth rate of terms of trade and five other dummy variables. The
study concludes that the economic growth rates of Group 1 countries showed a sharp
reduction whereas, other east Asian countries were less affected. Also, the failure of the
investment ratios to rebound showed that the crisis had long-term adverse effects on these
countries.
Nouriel Roubini & Xavier Sala-i-Martin in their paper "Financial repression and economic
growth" have tried to do an empirical as well as theoretical analysis of the relationship
between different financial repression policies and their effect on the long term growth of a
country. The model suggests that the central bank may choose to suppress the financial
sector because of the increase in money demand and easy revenue generation. Also, there
exists a negative correlation between financial repression and growth rate of the economy.
After keeping different factors of growth at test, the study found out that inflation, banks
reserve ratios and growth are negatively related to financially repressive policies. The paper
also found out control measures for policies which safeguard the economy against any
growth regressions. It concludes with the suggestion that controlling for policies, we can
eliminate the weak growth experienced by the economy in a financial repression.
TC Chiang, BN Jeon, H Li in their paper “Dynamic correlation analysis of financial

contagion: Evidence from Asian markets” measured how each country’s financial crisis
affected other countries. The methodology used by them was a dynamic conditional-
correlation model to nine Asian daily stock-return data series from 1990 to 2003. The
empirical evidence confirms a contagion effect. Statistical analysis of the correlation
coefficients also finds a shift in variance during the crisis period, casting doubt on the
benefit of international portfolio diversification. Evidence shows that international
sovereign credit-rating agencies play a significant role in shaping the structure of dynamic
correlations in the Asian markets. Their source of data was IMF Staff Papers and the Journal
of Empirical Finance.
Menzie D.Chinn,in her paper “Before The Fall: Were East Asian Currencies Overvalued?”
measures whether east Asian currencies were overvalued before the financial crisis by
identifying the equilibrium exchange rate. The methodology used is the calculation and
comparison of PPP rates by Johanson and Horvath-Watson cointegration test as well as
calculation of equilibrium rate from a monetary model using productivity trends as a proxy
variable. The baht, ringgit and peso were found to be overvalued by the tests. The monetary
models do not imply large deviations from equilibrium rate. Both methods imply that the
Korean Won was undervalued even before the financial crisis.
Martín-Guzmán, P. (2005). Population and poverty. Genus, 61(3/4), 167-184. Retrieved
from http://www.jstor.org/stable/29789273
In this paper, authors aim to comment on number of connections between demographic
patterns and poverty reduction which have been tested adequately and are now
acknowledged widely. Author says that poverty is a multidimensional phenomenon with
number of perspective viz. poverty as deprivation, poverty as exclusion and poverty as
dissatisfaction. Poverty seems to be more or less not affected by steady population growth
and hence author has population neutralism point of view. High fertility has significant
connection with poverty although mortality is not that a factor of concern as it mostly
depends on exogenous factors. Demographic dividend helps in stimulating economic growth
and reduce poverty but different nations have different level of impact. Lastly, migration
also promotes economic growth and poverty reduction to extent that transfers from
emigrants are, at least partly, used for investments and education.
Barrientos, A., & Neff, D. (2011). Attitudes to Chronic Poverty in the 'Global Village'. Social
Indicators Research, 100(1), 101-114.
The major objective of this paper is to analysis and establish a shared public perception of
chronic poverty in the countries that are denoted as ‘global villages’ and also the factors
influencing the attitude. Author states that chronic poverty leads to greater vulnerability
and harm as it creates poverty traps. Global village consists of countries included in wave
three of the World Values Survey (WVS3) (1994-98). Major finding of the paper is that the
respondents of survey in the sample region believes that there is very less chance of
escaping from the predicament. There is a robust uniformity in the attitude to the chronic
poverty in the sample region. Various factors influencing the attitude include personal
characteristics, interest and position, epistemic factors and political values and policy
processes. Authors suggests that policy makers willing to place emphasis on the duration
dimension of poverty and willing to tackle chronic poverty, are more likely to gain public
support. They also suggest that research on poverty and views on justice is a major way to
tackle global poverty.
Paolo Figini, & Enrico Santarelli. (2006). Openness, Economic Reforms, and Poverty:
Globalization in Developing Countries. The Journal of Developing Areas, 39(2), 129-151.
The paper deals with the impact of globalization on poverty. Paper also discusses various
problems related to the definitions and measurements of poverty and globalisation. Paper
focuses on econometric study of relative and absolute poverty, analysis of definition of
globalisation and sensitivity analysis of model specification. Findings suggests that trade
openness and size of government are associated to lower absolute poverty levels. While
financial openness is linked to more relative poverty. Authors suggests that policy makers
should be aware of globalisation as it is a controversial issue. Also, international trade
integration should be taken as an opportunity to attain economic growth and poverty
reduction. State should form policies so as to keep check and manage financial openness as
it hampers relative poverty.
Objectives:
 To gain an insight into the fluctuations in HDI in different countries and the factors
driving it.
 To propose predictions for the future HDI ranks and values from the HDI growth
rates and trends.
 To determine how selected economies measure up against each other HDI – wise
through a cross – sectional analysis.
 To study the economic growth of some countries in the East Asia region using
different indicators of economic growth.
 To study if the economic growth in these countries has borne fruit in terms of
reduced poverty and inequality alike.
Introduction
The paper analyses the growth and development in selected Southeast Asian and Pacific
economies. The countries selected are Philippines, Myanmar, Hong Kong, Vietnam, Taiwan
and Indonesia. We analysed them based on their HDI values, Economic growth and poverty
conditions.
Human Development Index values for the countries were collected from United Nations
Development Programme reports. The time period considered was from 1990 to 2015. This
is because HDI values for most countries are available only from 1990 onwards. Time series
data for all three components of HDI – The Health index, Education Index and Income Index
– were considered. We found the trends and patterns to gain an insight into the rise in HDI
in the different countries and the factors driving it. Growth rate in HDI averaged across the
past decade and a half was also calculated and plausible predictions of the future were
proposed. We also conducted cross -sectional analysis to determine the selected economies
measured up against each other in terms of HDI. Finally, we see how these countries have
performed against similar countries of similar size, population and GDP.
Next, we consider one of the most important factors for growth and development of a
country – its economic growth. The economic growth for a country or a region can be
measured and analysed using different methods like GDP growth rate, GDP per capita, GNI
per capita and many more. We measure economic growth in terms of Gross Domestic
Product (GDP), which is one of the most important and largely used measure for economic
growth. It constitutes the market value of all final goods and products which are produced
within the country or a region. We also consider the per capita Gross National Income. GNI
per capita is the dollar value of a country's final income in a year, divided by its population.
It is a largely used metric to determine the average income of a country's citizens.
We also check if the economic growth in these nations has translated into development by
analysing the conditions of poverty in the selected economies. The parameters used in the
said analysis include Poverty Headcount ratio as an indicator for the population under the
poverty line. GINI index is also considered to measure the inequality existing within the
selected economies.
Economic Growth
Objective: To study the economic growth of some countries in the East Asia region using
different indicators of economic growth.
The economic growth for a country or a region can be measured and analysed using
different methods like GDP growth rate, GDP per capita, GNI per capita and many more. In
this study we will see some of these methods and try to learn about the ‘Economic Growth’
in countries of the East Asia and Pacific region namely Hong Kong, Indonesia, Philippines,
Taiwan, Vietnam.
GDP annual growth (in %)

We measure economic growth in terms of Gross Domestic Product (GDP), which is one of
the most important and largely used measure for economic growth. It constitutes the
market value of all final goods and products which are produced within the country or a
region. It is generally calculated in USD to maintain a uniformity across the world and also to
easily compare it to other countries.
Another important thing is to look at the GDP growth rate. It is a common practice to
calculate GDP quarterly, semi-annually and annually and find out the growth rate in
percentage terms. This practice gives us another insight on the overall development of the
economy. GDP annual growth rate (in %) is one of the most used economic growth
indicators in the modern world.
Following are line graphs including the trend of GDP growth rate of the countries in focus
mainly from the East Asia and Pacific region of the globe.
❏ Hong Kong
Source: https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG
The GDP growth in Hong Kong has never been very stable. In July 1997, UK transferred
sovereignty of Hong Kong and the country came under special administration of People’s
Republic of China. We can see effects of East Asian Currency crisis of 1997 and the Financial
Crisis of 2008.
❏ Indonesia
The GDP growth of Indonesia has been quite stable plying to the business cycles of an
economy. Only a sharp effect of the 1997 Currency Crisis can be noticed from the graph. It is
interesting to note that the Financial Crisis of 2008 had a very little effect on the economic
development of Indonesia as it had minimal involvement in the United States, where the
crises evolved.
❏ Myanmar
The Myanmar economy has been a part of various economic and political ideological
struggles, which has adverse effects on the living standards. Years of unrest and civil war
have hampered the economic growth of the country. It has also contributed to the current
levels of poverty. There have been no focused efforts towards improving the economic
infrastructure which is expected as the has just established constitution in 2015.
❏ Philippines
Philippines was considered second richest economy of East Asia, just after Japan after the
World War in 1945. The major export being electronic chips, the economic growth has seen
a bit of stability in the 20th century. This growth was hampered by the 2008 Financial Crisis
as seen in the graph.
❏ Taiwan
Source: https://eng.stat.gov.tw/point.asp?index=1
The economic growth in Taiwan in the latter half of 20th Century is phenomenal. It is being
called the ‘Taiwan Miracle’. It is one of the Four Asian Tigers. Because of the conservative
financial policies and strict government actions it saw a minimal impact of the 1997 East
Asian Currency Crisis. However after the presidential elections in 2004, the poor policies of
the administration led Taiwan to recession during the Financial crisis in 2008-09.
● Vietnam
Vietnam is one of the fastest growing economies in the world. Even the projections for the
next decade are averaged at more than 10%, which is a huge indication of the fast
emergence of the country as a world development driver. It survived the 1997 economic
crisis by taking the right steps during the deleveraging and found a new balance for the
economy. The government keeps a check on the currency valuation for economic stability in
the country.
We will look at individual countries at a later stage. For now let us look at a comparative
rate of GDP growth of all countries.
As we can see the growth rates of all six countries in a condensed form in the above graph.
But is will still be unfair to compare the economic growth of these East Asian countries on
the basis of just the GDP growth rates, as it does not incorporate the different issues of
lifestyle, politics, inequality, religion and other factors which are varied for each and every
country of the region.
This graph shows us that countries like Indonesia, Hong Kong and Philippines had major
effects of the currency crisis in 1997. And similarly, Hong Kong, Philippines and Taiwan had
impacts during the financial crisis in 2008.
Data for GDP annual growth (in %):
Year/Country Hong Kong Indonesia Myanmar Philippines Taiwan Vietnam
1985 0.757 2.462 2.851 -7.307 4.81 3.806
1986 11.056 5.875 -1.057 3.417 11.52 2.789
1987 13.398 4.926 -4.006 4.312 12.7 3.583
1988 8.512 5.78 -11.352 6.753 8.02 5.135
1989 2.277 7.457 3.695 6.205 8.75 7.365

1990 3.83 7.242 2.817 3.037 5.65 5.101
1991 5.702 6.912 -0.651 -0.578 8.32 5.961
1992 6.235 6.498 9.661 0.338 8.29 8.646
1993 6.201 6.496 6.039 2.116 6.8 8.073
1994 6.036 7.54 7.478 4.388 7.49 8.839
1995 2.374 8.22 6.948 4.679 6.5 9.54
1996 4.259 7.818 6.443 5.846 6.18 9.34
1997 5.1 4.7 5.652 5.185 6.11 8.152
1998 -5.883 -13.127 5.866 -0.577 4.21 5.764
1999 2.507 0.791 10.945 3.082 6.72 4.774
2000 7.663 4.92 13.746 4.411 6.42 6.787
2001 0.561 3.643 11.344 2.894 -1.26 6.193
2002 1.657 4.499 12.026 3.646 5.57 6.321
2003 3.056 4.78 13.844 4.97 4.12 6.899
2004 8.7 5.031 13.565 6.698 6.51 7.536
2005 7.388 5.693 13.569 4.778 5.42 7.547
2006 7.033 5.501 13.076 5.243 5.62 6.978
2007 6.465 6.345 11.991 6.617 6.52 7.13
2008 2.128 6.014 10.255 4.153 0.7 5.662
2009 -2.459 4.629 10.55 1.148 -1.57 5.398
2010 6.768 6.224 9.634 7.632 10.63 6.423
2011 4.815 6.17 5.591 3.66 3.8 6.24
2012 1.7 6.03 7.333 6.684 2.1 5.247
2013 3.102 5.557 8.426 7.064 2.2 5.422

2014 2.762 5.007 7.991 6.145 4 5.984
2015 2.394 4.876 7.294 6.067 0.81 6.679
2016 2.046 5.016 6.5 6.924 1.5 6.211
GNI per capita, PPP
GNI stands for Gross National Income; GNI per capita is the dollar value of a country's final
income in a year, divided by its population. It is a largely used metric to determine the
average income of a country's citizens. It is defined to be the sum of value added, by all the
different producers (domestic) of a nation, plus any taxes (without subsidies) not included in
the gross output, plus income from abroad like employee compensation and property pay.
“In any case, we ought to dependably remember that Real income can't be increased
without creating more, redistributing income does nothing to increase the amount of
accessible wealth.” (Mings and Marlin 2000).
PPP refers to Purchasing Power Parity; GNI PPP is gross national income (GNI) changed to
international dollars using purchasing power parity rates. The international dollar has the
equal purchasing power over GNI as compared to a U.S. dollar has in the United States of
America. A question arises regarding why it is imperative to show GNI per capita in PPP
international dollars?
A simple clarification is that, for us to make a comparative analysis of more than 190 diverse
countries, with varying price levels. To compare this kind of economic statistics across
countries, the data must first be changed into a common value. Unlike foreign exchange
rates, PPP rates of exchange enable this change to take account of price contrasts between
countries. In that way GNI per capita (PPP $) is a better reflection of people's living
standards uniformly. In principle, 1 PPP dollar (or international dollar) has the same
purchasing power in the domestic country as 1 US dollar has in the US economy.
Now we will look at the GNI per capita PPP, of countries under our observation.
Source: https://data.worldbank.org/indicator/NY.GNP.PCAP.PP.CD
Data for GNI per capita, PPP :
Year/Country Hong Kong Indonesia Myanmar Philippines Taiwan Vietnam
1990 16950 2840 480 2550 8431 910
1991 18260 3090 490 2590 9382 990
1992 19650 3310 540 2630 11010 1100
1993 21870 3590 580 2700 11458 1190
1994 23080 3920 630 2840 12352 1320
1995 23800 4260 680 2980 13326 1470
1996 23750 4610 720 3160 13836 1610
1997 25380 4830 770 3360 14184 1730
1998 24430 4070 810 3580 12934 1830
1999 25210 4020 900 3650 13947 1920
2000 27180 4300 1040 3920 15142 2070
2001 28160 4630 1160 4080 13703 2220

2002 28470 4880 1310 4220 14062 2370
2003 30560 5100 1510 4570 14544 2550
2004 33720 5390 1740 4940 15879 2780
2005 36630 5780 2020 5360 16930 3050
2006 40880 6240 2340 5700 17446 3310
2007 44670 6730 2680 6110 18256 3580
2008 47440 7220 2990 6460 18564 3810
2009 45250 7510 3310 6790 17531 3950
2010 48130 8040 3650 7310 19864 4230
2011 51450 8590 3900 6840 21507 4510
2012 52020 9160 4100 7350 21967 4800
2013 54490 9680 4470 7930 22526 5070
2014 56660 10180 4820 8410 23330 5390
2015 58010 10680 5070 8850 23109 5720
2016 60530 11220 5469 9400 23258 6050

Poverty
Poverty is not just about the lack of sufficient money to meet the basic needs viz. food,
clothing and shelter. It is much more than just having sufficient money. Poverty has number
of approaches and definitions.
According to World Bank Organization, poverty can be described as:
“Poverty is hunger. Poverty is lack of shelter. Poverty is being sick and not being able to see
a doctor. Poverty is not having access to school and not knowing how to read. Poverty is not
having a job, is fear for the future, living one day at a time.
Poverty has many faces, changing from place to place and across time, and has been
described in many ways. Most often, poverty is a situation people want to escape. So
poverty is a call to action -- for the poor and the wealthy alike -- a call to change the world so
that many more may have enough to eat, adequate shelter, access to education and health,
protection from violence, and a voice in what happens in their communities.” [1]
Undermining key human attributes like health is also poverty. WHO defines poverty in
absolute terms of low income – say, US$2 per day or less. This is a global phenomenon, seen
in the low, middle and high income countries. [2]
Poverty can be described as the condition or state in which an individual or community lacks
resources especially financial resources and essentials to enjoy the basic minimum standard
of living and wellbeing which is considered as acceptable by the society. In United States,
poverty status is given to the people who do not meet the certain levels defined by the
Department of Health and Human Services. [3]
Pilar Martin in his paper ‘Population and Poverty’ has identified three approaches to analyse
concept of poverty. [4]
● Poverty as Deprivation: This approach deals with the concept of absolute

poverty. It states poor as those who have been deprived of basic essential
needs.
● Poverty as Exclusion: This approach corresponds to the concept of

relative poverty. It states poor as those who have been excluded due to lack
of resources from what is considered to be usual in the community.
● Poverty as Dissatisfaction: This is also called subjective poverty. It

describes poor as those who feels that their level of income is not sufficient
for them to meet their basic minimum living standards.
There are various other approaches of poverty. The more factors are added to measure
poverty, the more complex the measurement becomes. Therefore, many a time very few
essential factors like cash requirement or nutritional requirements are used as the measure
of poverty.
CAUSES OF POVERTY
There are number of causes of poverty and each cause has its own different effect
depending on the situation. The differences between rich and poor within a country and
across countries can be huge. [1]
Major possible causes for poverty can be – unemployment, lack of earnings and choices of
individual. Let us look into each of the causes briefly. [5]
● Unemployment: Employment is the basic way for an individual to earn money in

order to meet his/her daily basic essentials. Depriving from this state can lead to
poverty. A prolonged state of unemployment can create poverty and hardship for
people. Although it may be possible that unemployment is not just only due to the
unavailability of work.
● Lack of Earning Ability: Another cause of poverty is inability to earn above the very
low wage rate. This condition persisting for a long duration can lead to extreme
poverty. This inability can be attributed to lack of adequate required skills due to lack
of knowledge originating from low level of schooling standards. Another origin for
this lack of knowledge can be lack of training.
● Role of Individual Choices: Above two causes cannot be the only reason for poverty.
Poverty can also be attributed to the choices made by the individual. This may be the
result of rational choices made by an individual. An individual may choose leisure for
cash income and knowing that this could lead to poverty condition.
There is a huge possibility of various other factors that can cause poverty and that majorly
depends on the region and various other regional factors. We will discuss those factors and
causes subsequently as we progress.
METHODS OF ESTIMATES
From the above discussion we have seen that poverty is a multidimensional phenomenon.
Therefore, there cannot be a single method for measuring poverty level. Different nations
and organizations have different methodologies for measuring and analysing poverty.
Selection of these methodologies depends on the approach of poverty that organization or
nation adopts. Huge number of work has already been carried out on the methods to
estimate poverty levels, though World Bank is further working to find indicators to the other
dimensions of poverty like education, health, vulnerability, social inclusion etc.
There exist various problems in measuring income levels of low income group and hence
cash income is a misleading indicator for measuring poverty as low cash income can only be
a temporary problem for certain individual. Indicators should also include in-kind
parameters like health, housing etc. in addition to the cash income.
Studies on poverty on international front shares some problems like, low comparability
among countries as different nations use different definitions of income and inaccurate
estimation of inequality and hence relative poverty. As a result, one should keep in mind
while comparing countries that there is there are different indicators used and hence is not
truly comparable. [6]
We shall now look into various causes that can cause poverty, their methods of evaluation
and poverty trends around the world and also in few East Asian and Southeast Asian nations
namely: Hong Kong, Indonesia, Myanmar, Taiwan, Philippines and Vietnam.
POVERTY AROUND THE GLOBE

The tedious task of measuring poverty of different nations around the world is done by
World Bank. World Bank carries out this exercise to keep track of poverty levels and analyse
the effect of policies in motion to reduce poverty. Constant track of these poverty levels are
required to analyse the proper impact of the poverty reduction exercises that are being
carried out around the world. World Bank has set a target of eliminating the extreme
poverty by 2030 and reducing poverty to 3% from present 10.7% level at the present
poverty line levels.
Measuring poverty trends over time at global require creating baseline consistent across
countries. This one once decided, needs to be held constant in real terms as relative prices
change—that is: as the prices of goods and services vary differently over time across
countries. This line was set at $1.25 per day in 2005 dollar between 2008-2015 but new
Purchasing Power Parity (PPP) conversion factors for 2011 made it necessary to change the
poverty line. Therefore, this level was raised to $1.90 per day in 2011 dollar. This new
benchmark level ensures that that the old and new poverty lines reflects the similar cost of
goods and services basket. [7]
World Bank has set international poverty line at $1.9 PPP, Lower Middle Income Class
Poverty Line at $3.20 PPP and Upper Middle Income Class Poverty Line at $5.50 PPP.
Poverty headcount ratio at present poverty line i.e. $1.90 a day (2011 PPP) as percentage of
population is 10.7% in 2013 against 35.3% in 1990 while number of poor at $1.90 a day
(2011 PPP) stands at 769 million in 2013 against 1.8670 billion in 1990.
Fig: Global Poverty Headcount Ratio at International Poverty line ($1.9 per day @ 2011 PPP)
Source: World Bank ( http://povertydata.worldbank.org/Poverty/Home )
Table: Poverty headcount ratio and number of poor (at $1.9 per day @ 2011 PPP)
Series Number of poor at Poverty headcount ratio at

Name/ $1.90 a day (2011 PPP) $1.90 a day (2011 PPP)
Year (millions) (% of population)
1993 1883.2 34
1996 1698.7 29.3
1999 1728.5 28.6
2002 1619.8 25.8
2005 1354.6 20.8
2008 1218.3 18
2010 1087.6 15.7
2011 960.1 13.7
2012 890.6 12.5
2013 768.5 10.7
Source: World Bank (http://databank.worldbank.org/data/reports.aspx?source=poverty-and-equity)

From the above graph and table, we can see that there is a significant decline in number of
poor globally. Also Poverty Headcount Ratio has also dropped significantly. Therefore, one
can say that the measure taken to reduce poverty are having a positive effect. These
measures and policies are properly targeted and are fruitful.
Some of the key areas that World Bank focusses on to reduce poverty level are climate
change, community driven development, education, disaster risk management, energy,
microfinance, nutrition, water and sanitation etc. These areas are in some or the other way
help in mitigating poverty around the globe. For example, after 2004 tsunami, poverty in
coastal areas of Indonesia rose from one-third of regional population to nearly half the
population. Therefore, even working in this sector can be beneficial for reducing poverty. [9]
POVERTY IN MYANMAR
Myanmar is one of the member nation of ASEAN. It is not very technologically advanced,
thus lacking technical know-how and hence its manufacturing sector is not well developed.
Also various other administrative constraints have led to huge dependence of its economy
on primary sector i.e. natural resources and agriculture.
This dependence on primary sector is one of the factor or causes of poverty in Myanmar.
Myanmar between 2005 and 2010 was able to reduce its poverty level measured at national
poverty line by nearly 7 percentage points (reducing from 32.1 to 25.6) alongside
maintaining a growth rate of 7.8%. This is an extremely great performance compared to rest
of the world. But when poverty levels are compared at international levels of $1.9 per day at
2011 PPP, poverty levels increased to 26.5% in 2010. Also there are number of regional
irregularities. Rural region has poverty around twice that of urban areas.
Prolonged storms and other natural disasters, lack of or inability to work are few factors
that add to poverty in Myanmar. These are apart from the reason of no or very less
developed manufacturing sector. This also leads to low level of automation and
mechanisation. Unemployment creates a great trouble, adding more to poverty levels.
Another issue is of migration. As per UNDP report,2013, there were around one million
migrants in 2010. Low mechanisation levels also hampers the major economic activities like
agriculture by yielding low output than the potential of the land. [11]
UNDP Myanmar estimated total cost of around 850,682 million Kyat or 2.3% of GDP
annually to overcome poverty. [11] Despite of these huge costs of poverty reduction,
Myanmar has done a notable job and has made a great progress in poverty mitigation.
Government was able to nearly achieve its target of reducing poverty from 26% to 16%
measured at national level, missing the target by around 3%. This was all due to economic
reforms, good performance and proper assistance from partner nations. [10]
Table: Poverty Indices for Myanmar
Series GINI No. of poor Populatio Poverty gap Poverty Poverty headcount ratio
Name index at $1.90 a day n at $1.90 a day headcount ratio at at national poverty lines
/ (2011 PPP) (total) (2011 PPP) (%) $1.90 a day (2011 (% of population)
Year (millions) PPP)
(% of population)
2005 .. .. 48482614 .. .. 32.1
2010 .. .. 50155896 .. .. 25.6
2015 38.1 3.4 52403669 1.5 6.5 19.4
Fig: Poverty Headcount Ratio (% of population) at national poverty level

POVERTY IN VIETNAM
Vietnam is also one of the member nation of ASEAN. Hunger and poverty have been a
significant problem in Vietnam. Vietnam has shown drastic change in its poverty and living
conditions. It has been able to cut short poverty by a huge amount. Also, according to 2013
data, Vietnam is now a middle income country with per capita income of US$1910. Its
achievements and policies in reducing poverty has won global appreciation. However, still
lot of work is left in this direction as fight against poverty is not over. [12]
Poverty in Vietnam also originates from number of causes, but the major ones are
demography related. Limited credit system, poor infrastructure, lack of public sector
services, low mechanisation, less number of working population as compared to dependent
members in each family, lack of education are few of the reasons or causes of poverty in
Vietnam.
Vietnamese government uses income level of VND 2.4 million per capita per year(US$150)
for rural household and VND 3.12 million per capita per year (US$195) for urban household
as poverty line during time period of 2005-2010. This was further adjusted to VND 4.8
million per capita per year for rural and VND6 million for urban households for duration of
2011-2015. It also defined pro-poor as VDN 401,000 to VDN 520,000 per capita per month
for rural and VDN 501,000 to 650,000 per capita per month for urban households. [12]
Presently, 7% population of Vietnam lives under national poverty benchmark and only 4.5%
of employed population has PPP of $1.9 per day. [13]
As per World Bank data, poverty headcount ratio at national poverty line has declined from
20.7% in 2010 to 13.5% in 2014. Vietnamese performance on international standards are
also pretty impressing. It has been able to reduce its poverty headcount ratio by 46% points
in just 20 years of time from 49.2% in 1992 to 2.8% in 2014. Although GINI index has
remained almost constant over the years.
Some of the factors like rapid economic growth during first decade of 21st century, highly
willing governments to fight poverty which rolled out number of pro-poor schemes for
socio-economic development, infrastructure development, international cooperation from
various organisations like World Bank, ADB, UN, European Commission has been a major
boost to Vietnam’s poverty reduction measures. [12]
Still there remains a major challenge for Vietnam in terms of poverty reduction. Currently
on half of the poorest as eligible for government run benefit schemes. Rapid urbanisation is
causing problem of rural population migrating to urban areas thereby increasing
unevenness in employment and hence increasing unemployment. This is also leading to high
income inequalities, lack of high education and health care. Vietnam has to make
development more inclusive by infrastructure development in rural areas, supporting
manufacturing and providing proper skill and knowledge trainings for better employability.
[13]
Fig: Poverty Indices for Vietnam
Source: World Bank (http://databank.worldbank.org/data/reports.aspx?source=poverty-

and-equity)
Table: Poverty Indices for Vietnam

and-equity)
Series/ GINI No. of poor Population Poverty gap Poverty headcount Poverty
Year index at $1.90 a day total at $1.90 a ratio headcount ratio at
(2011 PPP) day (2011 at $1.90 a day national poverty
(millions) PPP) (%) (2011 PPP) lines
(% of population) (% of population)
1992 35.7 34.3 68450100 14.9 49.2 ..
1998 35.4 26.6 75456300 8.6 34.8 ..
2002 37 30.2 79537700 10.1 38 ..
2004 36.8 21.6 81436400 6.9 26.5 ..

2006 35.8 16.2 83311200 4.9 19.5 ..
2008 35.6 12.6 85118700 3.5 14.8 ..
2010 39.3 3.6 86932500 0.9 4.2 20.7
2012 35.7 2.5 88809200 0.5 2.8 17.2
2014 34.8 2.5 90728900 0.6 2.8 13.5
POVERTY IN INDONESIA
Indonesia, a Southeast Asian nation. Poverty conditions are very poor in Indonesia. It has
been able to uplift 3.3 million Indonesians out of poverty since 2010, but yet another 28
million are left below national poverty line as on 2014.
Indonesia uses nutritional approach to benchmark its national poverty line. To determine
whether an individual is poor or not, it is assumed that if a person earns per day, enough to
purchase food that can provide energy equivalent to 2100 kcal per day plus the most basic
non-food items. Using this approach and data from National Socio-Economic Survey of 1963,
Indonesia has set its poverty line at Rp 374,500 per capita per month. Apart from this,
person’s poverty is determined by whether its household (including kids) is able to earn the
required minimum amount of money. [14]
With this poverty line in effect, Indonesia’s poverty rate stood at 10.64% on March 2017
registering a slight decline from 10.7% as on 2016. Out of total employed, 10.4% earn below
US$1.9 per day PPP. From 2011-2014, poverty decline at rate of just 0.5% per annum. Also
the major poor population resides in rural area where 13.8% were poor in 2014 as against
8.2% in urban areas. Also, GINI coefficient jumped from 0.31 in 2000 to 0.43 in 2013
indicating increased inequality in the nation.
Fig: Fig:Poverty Indices for Indonesia

and-equity)
There are various reasons for poverty in Indonesia, major being chronic poverty, increased
inequality, slow economic growth, unemployment, sluggish manufacturing industry, high
inequality in education level leading to higher differences in earnings. Health, education,
transport, infrastructure are major missing in rural areas. [15]
Although, government is working on the problem of poverty. Under its National Medium-
Term Development Plan 2010-2014, govt. has 3 cluster strategy for reducing poverty. First is
social assistance, second is community empowerment and third is microenterprise
empowerment. New RPJMN 2015-19 focuses on inclusive growth model. Government has
planned to increase jobs, improve investment opportunities, reduce inequality by
developing basic infrastructure and also strengthening education and health services. [15]
Table: Poverty Indices of Indonesia
Series Number of poor Poverty gap Poverty gap at Poverty headcount Poverty headcount ratio
Name/ at $1.90 a day national poverty ratio at $1.90 a day at national poverty lines
at $1.90 a day
(2011 PPP) lines (%) (2011 PPP) (% of (% of population)
Year (2011 PPP) (%)
(millions) population)
1993 108.9 17.1 .. 57.1 ..
1996 91.7 12.4 .. 45.9 17.5

1998 134.4 21.6 .. 65.3 ..
1999 83.4 9.5 .. 40 23.4
2000 84.1 9.2 .. 39.8 ..
2001 77.2 7.9 .. 36 ..
2002 50.9 4.3 .. 23.4 18.2
2003 51.3 4.4 3.1 23.3 17.4
2004 54.5 5.4 3 24.4 16.7
2005 49 4.4 2.9 21.6 16
2006 64.2 6.5 3.7 28 17.8
2007 53 4.8 5.1 22.8 16.6
2008 50.9 4.3 2.8 21.6 15.4
2009 44.1 3.6 2.5 18.4 14.2
2010 38.7 2.9 2.2 15.9 13.3
2011 33.4 2.4 2.1 13.6 12.5
2012 29.3 1.9 1.9 11.8 12
2013 24.8 1.5 1.8 9.8 11.4
2014 21 1.3 1.8 8.3 11.3
2015 19.3 1.3 .. 7.5 11.2
2016 17.8 1.1 .. 6.8 10.9
POVERTY IN HONG KONG

Until 2009, Hong Kong did not have any poverty line and poverty estimates. Then in
December 2012 it formed Commission on Poverty (CoP) with its primary objectives as to
estimate poverty scenario, policy formation assistance and measuring policy effectiveness.
According to latest data, Hong Kong has around 1.35 million poor in 2016, about 20% of its
population. [16] This is an increase against 2015 figures of 14.3% of population, about
970,000 poor. [17] These estimates are as per national poverty line. One of the characteristic
feature of Hong Kong population is that it has high share of senior citizens, about 16% in
2015 and this figure has only registered increase since 2009, from 13.4%. [18] This figure of
population above 65 years of age was much higher in 2016 at 32%.
The first committee of CoP set poverty level as 50% of median monthly household income
before policy intervention. This was further revised to HK$3800 for one-member household
and HK$8800 for two-member household. [16] This poverty line was further increased in
2016 to HK$4000 for a single person household and HK$9000 for two-member household.
[18]
Major causes for poverty in Hong Kong are high senior population share which is non-
working and hence is a major cause for decreasing income level of a household. Also there
are no retirement plans for senior citizens which adds to the misery of countries
households. Other issues are inappropriate education, low employment assistance from
government, ethnic disparity are also a causes making an individual susceptible to the
poverty.
However, government has set a plan to fight poverty. In 2014, it announced Policy Address
with special focus on poverty alleviation. Various measures by government are periodic cash
help specially for older population, allowances for low income working households (LIFA),
setting of community care funds, subsidising housing, and a willingness to alleviate poverty.
It has been increasing it expenditure on social welfare every year, keeping it to around 17-
18% of government expenses.
POVERTY IN TAIWAN
Taiwan currently has a very low poverty rate of around 1.75%, with only 130,000 people
living below poverty threshold. [19] This is an example that shows that if any nation wants to
eradicate poverty and there is sufficient will to do so, poverty can be eradicated.
Measurement of poverty in Taiwan is bit different from rest of the world. In Taiwan, each
city or province set its own poverty threshold based on monthly income. Each city issues its
own monthly income for poverty measurements. Say for example, in 2017, a household in
Kinmen County should have a minimum income of $171 monthly while that in Taipei City
should have a minimum income of $337 monthly for meeting the basic necessities. [19]
Taiwan uses relative poverty line and sets it poverty threshold at 60% of the median
disposable income per capita. Though each city or province has its independent poverty
line, in 2011, standard is set at TWD 10,244 which is nearly US$325. [20]
Table: Poverty Rate in Taiwan
Year 1999 2000 2005 2006 2007 2008 2010 2012 2017
Poverty 1 1 0.9 0.9 0.95 1.08 1.16 1.5 1.78

Rate (%)
Source: https://www.indexmundi.com/taiwan/population_below_poverty_line.html
Fig: Poverty Rate in Taiwan
This low poverty rate of Taiwan is not just a coincidence rather it is the result of the efforts
that the Government of Taiwan had put in to eradicate poverty. Government received a
great held from number of civic bodies and academic institutions. Government has been
spending a huge sum of money for social welfare and infrastructure rehabilitation programs.
Number of subsidies are also given to those under poverty line. According to Taiwanese
government, it spent around $5.08billion on social welfare programs in 1999. Although the
welfare scheme’s selection is quite adverse and also there is a problem in poverty line of
Taiwan. Many people think that poverty threshold in Taiwan is very low. Also the welfare
schemes work on the principle of ‘all or nothing’. Hence, even if a household comes out of
poverty line just by slight margin, it will stop getting the financial assistance by the
government in terms of social welfare schemes. [19]
Sighting this problem, government increased its poverty line in 2011, thereby including
588,000 more beneficiaries to the social welfare schemes. Government has been very
consistent with the social welfare expenditure, and various benefits it provides to its citizens
in terms of job, schooling, health care in assistance with various other NGOs. [21]
Apart from those under poverty line, Taiwanese government also provide financial
assistance to senior citizens and handicapped. They are given certain amount each month as
subsidy. Also, government looks after the insurance and emergency aids of the low income
households.
POVERTY IN PHILIPPINES
Poverty rate in Philippines is quite high. According to recent data of 2015, poverty rate
stands at 21.6% after registering a slight decline. Poverty measurement in Philippines are
done on cash equivalent of nutritional requirements and as per 2015 data of Philippines
Statistical Authority (PSA), it has been set as follows:
“A family of five needed at least PhP 6,329, on average, every month to meet the family’s
basic food needs and at least PhP 9,064, on average, every month to meet both basic food
and non-food needs.” [22]
These are monthly food and poverty thresholds. There is an increase of 15% in this
threshold as compared to 2012 stats.
The major causes of poverty in the region is frequent typhoons. They hit the agriculture
activities very hard. This has been a major setback to the path of poverty reduction. Country
has registered a great decline from 26% poverty rate to 21.6% despite of these shocks. [23]
Although there has been a great effort put in by the government in terms of improving
economy. Philippines has registered and increased welfare and increased saving. The
government has increased social welfare spending and hence is getting good results in
poverty reduction.
Fig: Poverty Indices of Philippines

and-equity)
Table: Poverty Indices of Philippines
Poverty headcount ratio at $1.90 a day

No. of poor at $1.90 a day
Year GINI index (2011 PPP)
(2011 PPP) (millions)
(% of population)
1994 42.9 17.1 25
1997 46 12.9 17.7
2000 42.8 11.3 14.5
2003 41.5 10.9 13.1
2006 42.9 12.9 14.7
2009 41.8 9.9 10.7
2012 42.2 11.7 12.1
2015 40.1 8.5 8.3

Looking Forward
Despite the many definitions, one thing is certain; poverty is a complex societal issue. No
matter how poverty is defined, it can be agreed that it is an issue that requires everyone’s
attention. It is important that all members of our society work together to provide the
opportunities for all our members to reach their full potential. It helps all of us to help one
another. [1]
Since poverty measurements are done in different ways in different nations and by different
institutions, comparison of poverty among countries becomes difficult. Therefore, World
Bank has undertaken this task of measuring poverty for different nations on a same
parameter i.e. $1.9 per day per capita. This can be taken as standard to compare poverty
rates in different nations. Although this cannot be regarded as true comparison as different
nations have different perspective and nature of poverty and hence best measure of
poverty can only be seen through national poverty lines. Poverty measurement can be done
on any basis for example cash income, nutrition etc., but the most common is that of
nutritional basis and cash income basis.
As one can see from the data of the above six discussed nations, that though all the
countries belonged to the East Asia or South East Asia, the levels of poverty is very different
in each nation. Although there have been significant efforts put into mitigate poverty and all
this has shown great results in some cases like that of Taiwan where poverty is nearly
eradicated. One of the common feature of poverty eradication measures is that there
should be a strong political willing as poverty alleviation measures require lots of public
spending and social welfare schemes and these can come into full effect only when
government is keen to fight poverty. As in case of Taiwan, the government has spent a
significant amount of money in social welfare schemes and infrastructure development.
Another factor that is required in fight against poverty is the development of infrastructure
for deprived sections and providing them with financial assistance till they are self-
sufficient.
Therefore, one can say that it is not impossible to remove poverty, what needed is just the
willingness to fight against it.
Human Development Index – HDI
Human Development Index – HDI – is a composition of three indicators which broadly

define human development – a health index, an education index and an income index. It
was developed by a Pakistani economist, Mahbub ul Haq for the United Nations
Development Programme – UNDP. According to the UNDP, the HDI was given form to stress
on the fact that economic growth alone can neither explain nor predict the development of
a country. Instead, people and their capabilities must be the ultimate criteria for assessing
the development of a country. The HDI is a geometric mean of the normalized indices for
each of the three dimensions.
The health index is measured by acknowledging the fact that life expectancy at birth is
highly correlated with the average health of a country’s citizens. The education index
incorporates both the average years of education of adults aged 25 and the expected years
of schooling for a child. The logarithm of income is used to reflect the diminishing
importance of income with increasing GNI. This helps to measure the Income index.
In this section of the paper, we attempt to compare the HDI trends and the HDI growth
rates of the five countries concurrently. Further, we break down HDI into its three
components and compare them over time too. Similarities and differences arising from
proximity and political structure are discussed at length. Fluctuations in growth rates and
kinks in trendlines are also celebrated.
Myanmar
In the latest report released by the United Nations Development Programme (UNDP), the
HDI value for Myanmar stands at 0.556. This ranks the country 145th out of the sampled 188
countries. This places Myanmar squarely in the “medium human development” category.
Some countries around Myanmar in the rankings are Kenya and Pakistan below Myanmar
and Nepal and Cambodia above Myanmar.
The table below shows the values for the various indices that make the Human
Development index, including the values for Life expectancy at birth, Expected years of
schooling, Mean years of schooling and GNI per capita. The data is taken from official
reports published by the UNDP in its official reports for the 188 countries.
Time series data of Myanmar’s HDI trends:
Life expectancy Mean years of Expected years GNI per capita

Year HDI value
at birth schooling of schooling (2011 PPP$)
1990 58.7 2.4 5.9 745 0.353
1995 60.5 2.7 7.2 928 0.393
2000 62.1 3.1 7.6 1,257 0.427
2005 63.6 3.6 8.0 2,196 0.474
2010 65.0 4.1 9.1 3,604 0.526
2011 65.3 4.3 9.1 3,780 0.533
2012 65.5 4.5 9.1 4,020 0.540
2013 65.7 4.7 9.1 4,314 0.547
2014 65.9 4.7 9.1 4,660 0.552
2015 66.1 4.7 9.1 4,943 0.556
As can be seen from the table above, Myanmar has achieved significant improvement in all
the factors that are used in the calculation of HDI. The Life expectancy at birth has steadily
increased from 58.7 years in 1990 to 66.1 years in 2015. The expected years of schooling has
gone up from 5.9 years to 9.1 years. However, the largest increase can be seen in Gross
National income, which has gone up from $745 (measured in terms of 2011 purchasing
power parity dollars) to $4,943 in 2015, which is an increase of more than 700%. This
improvement has been brought about by steps taken by the Myanmar government post the
financial crisis of 1997 to consolidate its economy and improve the quality of life and
standard of living of its people.
The graph below shows the time series value of the indices for Life expectancy, Education,
per capita GNI and HDI.
Components of HDI - Myanmar

0.900
0.800
0.700
0.600
Index Value
0.500
0.400
0.300
0.200
0.100
1990 1995 2000 2005 2010 2011 2012 2013 2014 2015
Year
Life Expectancy index Education Index GNI Index HDI
Source: Human Development Reports – UNDP

Year Life Expectancy index Education Index GNI Index
1990 0.595 0.244 0.303
1995 0.623 0.290 0.337
2000 0.648 0.314 0.382
2005 0.671 0.342 0.467
2010 0.692 0.389 0.541
2011 0.697 0.396 0.549
2012 0.700 0.403 0.558
2013 0.703 0.409 0.569
2014 0.706 0.409 0.580
2015 0.709 0.409 0.589
Average Annual Growth (%)
1990-2000 2000-2010 2010-2015 1990-2015
1.90 2.12 1.10 1.83
The graph shows that among the subindices, Myanmar has the highest value for Life
expectancy and the lowest value for Education for all the years from 1990 to 2015. The
education index has increased significantly for 0.25 to above 0.4, however, it is still way
below the world standards. The sharpest increase among the indices is seen in the GNI per
capita, which has increased from 0.3 to almost 0.6. This increase is reflected in the value of
the HDI which has also increased sharply from 0.353 to 0.556.
Although Myanmar is still struggling in terms of its HDI ranking, it certainly has a few rays of
hope. The second table which depicts the average annual growth rate in HDI suggests that
Myanmar is quickly rising to a higher level and will compete soon with the others in the
same bracket for a better overall HDI rank.
Compared to other countries in the East Asia and pacific region, Myanmar lags behind in
HDI. The regional countries have an average HDI value of 0.720 which is significantly greater
then Myanmar’s HDI of 0.556. The only countries in the region which are close to Myanmar
in the ranking are Cambodia and Lao People’s democratic republic.
Vietnam
HDI value for Vietnam is 0.683. This ranks the country 115th out of the sampled 188
countries. This places Vietnam squarely in the “medium human development” category.
Some countries around Vietnam in the rankings are Philippines and El Salvador below
Vietnam and Palestine and Indonesia above Vietnam.
Table A: Viet Nam’s HDI trends based on consistent time series data
Life expectancy Mean years of Expected years GNI per capita HDI
Year
at birth schooling of schooling (2011 PPP$) value
1990 70.5 3.9 7.8 1,410 0.477
1995 72.0 4.6 9.3 2,020 0.531
2000 73.3 5.4 10.6 2,615 0.576
2005 74.3 6.4 11.3 3,423 0.617
2010 75.1 7.5 12.0 4,314 0.655
2011 75.3 7.6 12.2 4,513 0.662
2012 75.5 7.8 12.3 4,707 0.668
2013 75.6 7.9 12.5 4,899 0.675
2014 75.8 7.8 12.6 5,098 0.678
2015 75.9 8.0 12.6 5,335 0.683
The table above shows that Vietnam achieved improvement in all three subindices in the
period between 1990 and 2015. The Life expectancy at birth was for Vietnam was already
very high at 70.5 years but in the given period it improved even further to 75.9 years,
among the highest in the world. Mean years of schooling more than doubled from 3.9 years
to 8 years and the expected years of schooling also increased significantly from 7.8 years to
12.6 years. Thus, in the educational sphere, Vietnam saw a steady increase. The GNI per
capita increased from $1,410 (measured in terms of 2011 purchasing parity dollars). The
increase in the subindices led to a higher HDI value, however, the increase in HDI was not
very dramatic. The HDI increased from 0.477 to 0/683.
Figure 1 below shows the contribution of each component index to Vietnam's HDI since
1990.
Figure 1: Trends in Vietnam's HDI component indices 1990-2015

1990 0.777 0.347 0.400
1995 0.800 0.412 0.454
2000 0.820 0.474 0.493
2005 0.835 0.527 0.534
2010 0.848 0.583 0.569
2011 0.851 0.592 0.575
2012 0.854 0.602 0.582
2013 0.855 0.611 0.588
2014 0.858 0.610 0.594
2015 0.860 0.617 0.601
1990-2000 2000-2010 2010-2015 1990-2015
1.92 1.29 0.85 1.45
The graph shows that while the index value of education was below that of GNI per capita
for Vietnam in 1990, it is higher in 2015. This can be understood from the fact that while
mean years of schooling and expected years of schooling increased significantly over the
period, the per capita GNI did not. Among the three subindices, the Life expectancy index
continues to be the highest valued index, with its value being comparable to some of the
most developed countries in the world. However, the low values of the education and GNI
index lead to a middle range HDI value.
The fluctuations in the table of average annual growth rate of HDI in Vietnam needn’t be a
cause for worry. The growth rate in HDI has averaged around 1.45 for the past decade and a
half. This is way higher than many countries in the same bracket as Vietnam. Given a few
more years, perhaps a decade, Vietnam can easily catch up with the bracket leaders or also
be pushed into the next bracket of Developed Nations.
Similar to Myanmar, Vietnam’s HDI of 0.683 is lower compared to the average HDI of its East
Asian neighbours, which is 0.720. It is however higher than the average HDI of countries in
the middle HDI group, whose average is 0.631.
Philippines
HDI value for Philippines stands at 0.682. This ranks the country 116 th out of the sampled
188 countries. This places Philippines squarely in the “medium human development”
category. Some countries around Philippines in the rankings are El Salvador and Bolivia
below Philippines and Vietnam and Palestine above Philippines.

Year HDI value
1990 65.3 6.6 10.8 3,962 0.586
1995 66.1 7.1 10.8 4,097 0.597
2000 66.7 7.6 11.4 4,976 0.622
2005 67.2 8.3 11.5 6,036 0.646
2010 67.7 9.1 11.5 7,511 0.669
2011 67.8 9.2 11.6 6,893 0.666
2012 67.9 9.2 11.7 7,268 0.671
2013 68.1 9.3 11.7 7,752 0.676
2014 68.2 9.3 11.7 8,057 0.679
2015 68.3 9.3 11.7 8,395 0.682

The table shows that Philippines did not see any significant improvement in Life expectancy
at birth in the period between 1990 and 2015. The value only rose from 65.3 years to 68.3
years. Similarly, Philippines did not see any significant increase in the Educational indices, as
its expected years of schooling increased from 10.8 to 11.7 and mean years of schooling
increased from 6.6 years to 9.3 years.
However, there was a significant increase in per capita GNI, which went up from $3962
(measured in terms of 2011 purchasing power parity dollars) to $8,395. During this period,
the HDI went up from 0.586 to 0.682, not a sharp increase.
The figure below shows the individual components of Philippines’ HDI and how they moved
in the past decade and a half.
Components of HDI - Philippines

0.900
0.850
0.800
0.750
0.700
Index Value
0.650
0.600
0.550
0.500
0.450
0.400
1990 1995 2000 2005 2010 2011 2012 2013 2014 2015
Year
1990 0.697 0.520 0.556
1995 0.709 0.537 0.561

2000 0.718 0.570 0.590
2005 0.726 0.596 0.619
2010 0.734 0.623 0.652
2011 0.735 0.629 0.639
2012 0.737 0.632 0.647
2013 0.740 0.635 0.657
2014 0.742 0.635 0.663
2015 0.743 0.635 0.669
1990-2000 2000-2010 2010-2015 1990-2015
0.60 0.72 0.39 0.61
The graph shows that the highest valued index for Philippines is Life expectancy index while
the lowest valued index is the education index. This is line with results observed in the
Myanmar and Vietnam graphs as well. All subindices have risen steadily over the period and
a result, the HDI value has also increased. However, none of the indices have risen very
sharply. This is in contrast to some of the other countries in the region.
The Philippines, when compared to Myanmar and Vietnam does have more reason to worry
about their future HDI values. Their average annual growth rate in HDI is far less than that of
the two pervious countries. With an average of 0.61 in the past decade and a half, owing to
a sharp decline in the growth rate in the period 2010-2015, Philippines will definitely need
to up their standards to stay in the same bracket.
Philippines HDI value is greater than the average HDI value of middle group countries, which
is 0.631. Similar to Myanmar and Vietnam, the Philippine also lags behind its East Asian and
Pacific neighbours in its HDI ranking. Thailand and Indonesia, which happen to be in the
same region and have similar population sizes are ranked better than the Philippines.
Indonesia
HDI value for Indonesia stands at 0.689. This ranks the country 113th out of the sampled 188
countries. This places Indonesia squarely in the “medium human development” category.
Some countries around Indonesia in the rankings are Palestine and Vietnam below
Indonesia and Turkmenistan and Egypt above Indonesia.

Year HDI value
1990 63.3 3.3 10.1 4,270 0.528
1995 65.0 4.2 10.1 5,844 0.564
2000 66.3 6.7 10.6 5,243 0.604
2005 67.2 7.4 10.9 6,495 0.632
2010 68.1 7.4 12.3 8,234 0.662
2011 68.3 7.5 12.6 8,607 0.669
2012 68.5 7.6 12.9 9,017 0.677
2013 68.7 7.8 12.9 9,392 0.682
2014 68.9 7.9 12.9 9,703 0.686
2015 69.1 7.9 12.9 10,053 0.689
The table shows that the life expectancy at birth in Indonesia went up from 63.3 years to
69.1 years between 1990 and 2015. The mean years of schooling saw an extremely sharp
increase from 3.3 years to 7.9 years. At the same time expected years of schooling went up
from 10.1 years to 12.9 years.
This indicates that a large population were educated in the period. The per capita GNI went
up from $4270 (in terms of 2011 purchasing power parity dollars) to $10,053 while the HDI
value went up from 0.528 to 0.689.
Components of HDI - Indonesia

0.900
0.800
0.700
Index Value
0.600
0.500
0.400
0.300
1990 1995 2000 2005 2010 2011 2012 2013 2014 2015
Year
1990 0.666 0.391 0.567
1995 0.692 0.421 0.614
2000 0.712 0.518 0.598
2005 0.726 0.549 0.630
2010 0.740 0.588 0.666
2011 0.743 0.600 0.673
2012 0.746 0.612 0.680
2013 0.749 0.618 0.686
2014 0.752 0.622 0.691

2015 0.755 0.622 0.696
1990-2000 2000-2010 2010-2015 1990-2015
1.36 0.92 0.78 1.07
The graph shows that life expectancy at birth index is the highest valued subindex for
Indonesia. Its values for Education index and GNI per capita index are lower. However,
Indonesia saw a sharp increase in its education index between 1995 and 2000. The value of
the index increased from 0.4 in 1990 to 0.62, marking the largest increase among the three
subindices. This can also be seen from the tabulated values of EYS and MYS.
The value of the LEI went up from 0.67 to 7.5 while the GNI per capita index went up from
0.57 to 0.7. The graph shows an unusual downward movement between 1995 and 2000.
This decrease was primarily due to the East Asian currency crisis of 1997, which sent the
economies of various East Asian economies including that of Indonesia into turmoil.
Indonesia has shown a decent, gradual rate of growth in HDI. The rate of growth of 1.07 %
averaged across the last fifteen years is more than that of Philippines, but less than that of
Myanmar and Vietnam. Indonesia has had an influx of tourists in the past decade, which
could promote their average income, but they still need to focus on healthcare and
education to really reach the growth rates of the other mentioned countries.
Similar to the countries analyzed previously in this report, Indonesia has an HDI value
greater than the average HDI of middle group countries (0.631) but it is significantly behind
other East Asian and Pacific countries who have an average HDI of 0.720. Countries with
similar statistics to Indonesia are China and Philippines which are ranked 90 th and 116th
respectively. China saw remarkable progress between 1990 and 2015 as it went from below
Indonesia (in terms of HDI value) to above Indonesia.
Hong Kong
HDI value for Hong Kong is 0.917. This ranks the country 12th out of the sampled 188
countries. This places Hong Kong squarely in the “very high human development” category.
Some countries around Hong Kong in the rankings are New Zealand and Sweden below
Hong Kong and USA and Canada above Hong Kong.

Year HDI value
1990 77.5 8.6 12.8 26,185 0.781
1995 78.7 8.8 13.5 33,170 0.808
2000 80.4 8.8 14.1 34,310 0.825
2005 81.9 10.5 14.8 41,145 0.870
2010 83.1 11.2 15.3 49,130 0.898
2011 83.3 11.4 15.4 51,454 0.905
2012 83.6 11.6 15.2 51,067 0.907
2013 83.8 11.6 15.6 52,629 0.913
2014 84.0 11.6 15.7 54,019 0.916
2015 84.2 11.6 15.7 54,265 0.917
The table shows that Life Expectancy at birth increased from 77.5 years to 84.2 years
between 1990 and 2015. This value is among the highest in the world and shows the strong
healthcare system provided in the country. Hong Kong has similarly stellar statistics for
Education and for income. The expected years of schooling increased from 12.8 years to
15.7 years while mean years of schooling increased from 8.6 years to 11.6 years.
This increase shows that a large number of people in Hong Kong opt for higher education
and tertiary degrees and this number is only expected to rise in the future. The GNI per
capita increased from $26,185 (as measured in terms of 2011 purchasing power parity
dollars) to $54,265. This makes Hong Kong among the most prosperous countries in the
world.
The figure below shows the individual components of Hong Kong’s HDI over time.
Components of HDI - HongKong

1.000
0.950
0.900
0.850
0.800
Index Value
0.750
0.700
0.650
0.600
0.550
0.500
1990 1995 2000 2005 2010 2011 2012 2013 2014 2015
Year
1990 0.885 0.642 0.841
1995 0.903 0.668 0.877
2000 0.950 0.685 0.882
2005 0.952 0.761 0.909
2010 0.971 0.798 0.936
2011 0.974 0.808 0.943

2012 0.978 0.809 0.942
2013 0.982 0.820 0.946
2014 0.985 0.823 0.950
2015 0.988 0.823 0.951
1990-2000 2000-2010 2010-2015 1990-2015
0.55 0.85 0.42 0.64
The graph shows that among the three subindices, the Education index is the lowest valued
index for Hong Kong. This is largely due to its extremely high ranking in the other subindices.
However, the value of the education index has increased from 0.65 to above 0.8 between
1990 and 2015. Education index has risen the most during this period. The GNI per capita
index shows a general upward trend, going from 0.85 to 0.95.
However, there is a period of 5 years between 1995 and 2000 where it does not rise. This
flatness can be attributed to the East Asian Currency crisis of 1997 which had a detrimental
impact on the Hong Kong economy. The Life expectancy index for Hong Kong, which was
already high at 0.89 increased even further over the period to 0.99. Hong Kong’s high
ranking can be attributed to its stable economy and good governance.
Hong Kong’s HDI value is higher than even the average HDI of the “very high HDI group”
which is 0.892. Its HDI is significantly higher than that of its East Asian and Pacific
neighbours, whose average HDI value is 0.720. Other counties in the region which have
similar HDI values and population statistics as Hong Kong are Singapore and Brunei
Darussalam, which are ranked 5th and 30th respectively.
Comparison of HDI between countries:
All five countries, although they belong to the same part of the globe, show remarkable
variations in their HDI values. This can be attributed to their political structure, historical
events like wars, currency, and other factors.
Given below is a graph which plots each of the five country’s HDI over time.
Hong Kong, China

Year Myanmar Philippines Viet Nam Indonesia
(SAR)
1990 0.353 0.586 0.477 0.528 0.781
1991 0.361 0.587 0.486 0.528 0.786
1992 0.375 0.589 0.498 0.534 0.791

1993 0.381 0.591 0.508 0.545 0.799
1994 0.388 0.594 0.519 0.554 0.804
1995 0.393 0.597 0.531 0.564 0.808
1996 0.399 0.605 0.542 0.577 0.811
1997 0.405 0.609 0.542 0.59 0.815
1998 0.408 0.613 0.562 0.59 0.816
1999 0.417 0.618 0.569 0.597 0.819
2000 0.427 0.622 0.576 0.604 0.825
2001 0.435 0.625 0.584 0.608 0.833
2002 0.445 0.631 0.592 0.613 0.841
2003 0.455 0.636 0.601 0.624 0.851
2004 0.465 0.642 0.609 0.629 0.861
2005 0.474 0.646 0.618 0.632 0.87
2006 0.484 0.648 0.625 0.638 0.881
2007 0.493 0.655 0.633 0.641 0.887
2008 0.504 0.661 0.641 0.645 0.892
2009 0.515 0.662 0.647 0.656 0.894
2010 0.526 0.669 0.655 0.662 0.898
2011 0.533 0.666 0.662 0.669 0.905
2012 0.54 0.671 0.668 0.677 0.907
2013 0.547 0.676 0.675 0.682 0.913
2014 0.552 0.679 0.678 0.686 0.916
2015 0.556 0.682 0.683 0.689 0.917
In the graph above, the country which shows remarkable, consistent HDI values is Hong
Kong. It is not surprising, given the proximity and the relationship which it has with China.
Philippines, though it started off as second best in 1990, is quickly being overtaken by
Vietnam and Indonesia. This was apparent in the average annual growth rate table of
Philippines. It was then stated that it could lose out on a lot of HDI ranks if it does not
attempt to improve its status.
Vietnam and Indonesia, who both started below Philippines in HDI rankings in 1990, have
over time, caught up with it owing to consistent average annual growth rate in HDI. This is a
silver lining in for both the nations, and they are set to overtake Philippines and other
stagnant countries with their remarkable HDI growth rates. As of now, their HDI values
coincide with Philippines, and will soon leave it far behind if the current scenario continues.
Myanmar, although it has been the last among these 5 countries in terms of HDI, is growing
– slowly but surely. They boast of the highest average annual growth rate among these
countries – a mammoth 1.83 % in the past decade and a half. Given the current scenario,
Myanmar will surely catch up with the others in the pot, and may even challenge for a shift
to a higher bracket.
Conclusion
Regarding the five Southeast Asian countries that were discussed in this paper, several
interesting observations and conclusions can be made. In terms of HDI, Hong Kong is a clear
leader, not only among these five countries, but also on the global scene. With a HDI value
of 0.917, an average annual HDI growth rate of 0.64% and a current ranking of 12, Hong
Kong is a role model for the rest of the South Asian countries to emulate. Indonesia and
Vietnam are comparable in terms of their HDI rankings as well as their HDI growth rates.
Their political structure and proximity are factors which ensure this similarity. In Vietnam,
the Life Expectancy Index turns out to be a major push for their HDI. This is a good sign,
given the average living conditions in South – East Asia. Among the five countries discussed,
Philippines has the biggest cause to worry. Although its HDI is almost equal to that of
Vietnam and Indonesia, its HDI growth rate of 0.61% does not bode well. In an area of rapid
development, Philippines seems to be lagging behind. Myanmar, on the other hand, has
shown signs of steady development. It boasts of a mammoth 1.83% HDI growth rate, far
ahead of its neighbours. If it continues to stay this way, the future definitely looks bright for
Myanmar.
Although all the countries belonged to South East Asia, the levels of poverty are very
different in each nation. Considering the percentage of population who are below the
poverty line, Myanmar and Vietnam have shown a steady decline in the poverty headcount
ratio. Indonesia, on the other hand, has not. Hong Kong and Taiwan have almost eradicated
poverty while Philippines is slowly reducing its poverty headcount ratio. One of the common
feature of poverty eradication measures is a strong political willing, as poverty alleviation
measures require lots of public spending and social welfare schemes which can come into
full effect only when government is keen to fight poverty.
References

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Title

Iman Sugewan et al (2010), The Impact of Inflation on Rural Poverty in Indonesia: an

Niels Lind, Values Reflected in the Human Development Index Author(s):

TC Chiang, BN Jeon, H Li in their paper “Dynamic correlation analysis of financial

GDP annual growth (in %)

Data for GDP annual growth (in %):

Year/Country Hong Kong Indonesia Myanmar Philippines Taiwan Vietnam

1985 0.757 2.462 2.851 -7.307 4.81 3.806

1986 11.056 5.875 -1.057 3.417 11.52 2.789

1987 13.398 4.926 -4.006 4.312 12.7 3.583

1988 8.512 5.78 -11.352 6.753 8.02 5.135

1989 2.277 7.457 3.695 6.205 8.75 7.365

1991 5.702 6.912 -0.651 -0.578 8.32 5.961

1992 6.235 6.498 9.661 0.338 8.29 8.646

1993 6.201 6.496 6.039 2.116 6.8 8.073

1994 6.036 7.54 7.478 4.388 7.49 8.839

1995 2.374 8.22 6.948 4.679 6.5 9.54

1996 4.259 7.818 6.443 5.846 6.18 9.34

1997 5.1 4.7 5.652 5.185 6.11 8.152

1998 -5.883 -13.127 5.866 -0.577 4.21 5.764

1999 2.507 0.791 10.945 3.082 6.72 4.774

2000 7.663 4.92 13.746 4.411 6.42 6.787

2001 0.561 3.643 11.344 2.894 -1.26 6.193

2002 1.657 4.499 12.026 3.646 5.57 6.321

2003 3.056 4.78 13.844 4.97 4.12 6.899

2004 8.7 5.031 13.565 6.698 6.51 7.536

2005 7.388 5.693 13.569 4.778 5.42 7.547

2006 7.033 5.501 13.076 5.243 5.62 6.978

2007 6.465 6.345 11.991 6.617 6.52 7.13

2008 2.128 6.014 10.255 4.153 0.7 5.662

2009 -2.459 4.629 10.55 1.148 -1.57 5.398

2010 6.768 6.224 9.634 7.632 10.63 6.423

2011 4.815 6.17 5.591 3.66 3.8 6.24

2012 1.7 6.03 7.333 6.684 2.1 5.247

2013 3.102 5.557 8.426 7.064 2.2 5.422

2015 2.394 4.876 7.294 6.067 0.81 6.679

2016 2.046 5.016 6.5 6.924 1.5 6.211

GNI per capita, PPP

Data for GNI per capita, PPP :

Year/Country Hong Kong Indonesia Myanmar Philippines Taiwan Vietnam

1990 16950 2840 480 2550 8431 910

1991 18260 3090 490 2590 9382 990

1992 19650 3310 540 2630 11010 1100

1993 21870 3590 580 2700 11458 1190

1994 23080 3920 630 2840 12352 1320

1995 23800 4260 680 2980 13326 1470

1996 23750 4610 720 3160 13836 1610

1997 25380 4830 770 3360 14184 1730

1998 24430 4070 810 3580 12934 1830

1999 25210 4020 900 3650 13947 1920

2000 27180 4300 1040 3920 15142 2070

2001 28160 4630 1160 4080 13703 2220

2003 30560 5100 1510 4570 14544 2550

2004 33720 5390 1740 4940 15879 2780

2005 36630 5780 2020 5360 16930 3050

2006 40880 6240 2340 5700 17446 3310

2007 44670 6730 2680 6110 18256 3580

2008 47440 7220 2990 6460 18564 3810

2009 45250 7510 3310 6790 17531 3950

2010 48130 8040 3650 7310 19864 4230

2011 51450 8590 3900 6840 21507 4510

2012 52020 9160 4100 7350 21967 4800

2013 54490 9680 4470 7930 22526 5070

2014 56660 10180 4820 8410 23330 5390