The year was 1975. I had just decided to leave my ‘normal’ job as a university teacher in New Zealand and to use my skills as an engineer to help in what was then termed an ‘underdeveloped country’—in my case, Bangladesh.
At that time, the world was divided between ‘rich countries’ and ‘poor countries’, with the latter—countries like Bangladesh–assumed to simply need a hand up to climb the ladder of development to join the former.
Back in North America, the efforts of aid organizations were lauded as highly worthy efforts to share our prosperity with ‘poor countries’. As a nation, Canada was confident of its role in the world, and ready and willing to share of its prosperity with others.
Forty years later, the situation appears to have changed.
Bangladesh, like many other former ‘poor countries’, has seen its fortunes improve dramatically. Currently it appears that Bangladesh may meet several of the development goals set by the UN in 2000, a feat not achieved by its much more powerful neighbour, India.
Yet Bangladesh’s economic progress, largely driven by the global garment trade, may be fragile. For those left in the rural areas, life continues to be very hard. A closer look at the country’s progress shows that measures of growth and prosperity are driven largely by huge increases in wealth at the top.
The large garment industry has certainly been a tool of emancipation for many Bangladeshi women. But the maintenance of these gains depends on keeping their wages at or below the lowest wages elsewhere in the world. So those on the bottom are locked into low wages, while those at the top continue to add to their wealth. Inequality within the country has leapt dramatically since the chaotic days of 1975.
And what about Canada? The measures of national prosperity continue to look positive, with our real gross domestic product (GDP) per capita growing from $20,000/yr. to $36,000/yr. during this period But beneath these average measures, another story emerges.
The Gini Coefficient measures the inequality of income distribution. A Gini Coefficient of 0 means that everyone receives the same income while a coefficient of 1 means that one person receives all the income. In Canada, the Gini coefficient rose from 0.43 to 0.52 between 1981 and 2010. Among 17 rich countries, Canada has the 6th highest inequality of income.
There are several reasons for this growing inequality, but one of the main ones is just like in Bangladesh – globalization. In Canada, many well-paying manufacturing jobs have left the country for countries with lower wages. Even the Conference Board of Canada is concerned about inequality in this country.
The global picture has changed dramatically in the last forty years, since I went to Bangladesh as an aid worker. What was formerly a world divided into rich countries and poor countries, with the incomes within the countries much more equal, has become a world where the differences between countries have been reduced while the differences within countries have become much more significant.
What does this mean for Canada’s aid program? Canada’s moral imperative to help ‘poor countries’ may be less clear than it was 40 years ago. Canada remains a rich country—with a GDP/capita of $36,000/yr. we are still far wealthier than Bangladesh, at less than $1000/yr. But the rise of inequality in both countries raises important questions. Shouldn’t the wealthy in Bangladesh play a larger role in their countries development? Should Canadian pay more attention to income inequality in their own country? Should we focus more attention on rising poverty in Canada, and perhaps be more circumspect about how “developed” we really are.
