May 7, 2021 House of Trust

“Re-examining Urban Poverty” Webinar: Calling for a Bottom-up Approach

The “Re-examining Urban Poverty” webinar jointly organized by Embassy of Belgium in Malaysia, Center for Market Education and Bait Al-Amanah (House of Trust) was successfully held on the 15th of April 2021. This is the first initiative – aiming to increase awareness – in the realm of a broader program on addressing urban poverty, jointly organized by the three institutions. The webinar will be followed by a field research and by the presentation of a series of policy recommendations.

Dr Abdul Razak Ahmad, the Founding Director of Bait Al Amanah set the stage by highlighting that Urban poverty is a matter of great national importance in his introductory remarks. He added that “this non-discriminatory Covid-19 virus has evolved into a disease of the most vulnerable urban poor, due to the lockdown limiting access to online education and the opportunity to make a decent living”.

For the institutional address, on behalf of the Ambassador of the Kingdom of Belgium in Malaysia, Mr. Matthias Vanheusden, the Deputy Head of Mission of the Embassy of Belgium in Malaysia reiterated that the United Nation Sustainable Development Goals have provided us with the key principle, which is to leave no one behind. “The poor are at the bottom of the ladder, and a few steps of the ladder are missing”, he added. He also hoped that the experiences carried by Belgium and the European Union in urban poverty eradication can be of interest to Malaysian friends and he welcomes the idea of sharing expertise together worldwide.                         

After the address, Professor Dr. Fatimah binti Kari, the Former Director of the Centre for Poverty and Development Studies (CPDS), Universiti Malaya, presented on ‘The State of Urban Poverty in Malaysia’. She explained that although poverty is a very complex, complicated and fluid concept, what makes it solvable is how we measure poverty.

There are several issues with the way the poverty line income is constructed, including the technical faults of using the consumer price index, lack of clarity in the classification of food and non-food items, the inability to measure intensity and severity of poverty and the inability to take into account cost of living and the spatial aspects of poverty. These faults have resulted in inclusion and exclusion errors, undercounting and the difficulty to identify pockets of poverty including outliers. Professor Dr. Fatimah then recommended employing the cost of living index, rather than the consumer price index and proposed a Covid-19 adjusted multidimensional index.

The next presentation was on ‘The Pandemic and Urban Poverty’ by Wan Ya Shin, Research Manager at Institute of Democracy and Economic Affairs (IDEAS). She highlighted that the Covid-19 pandemic has led to the loss of food security and loss of livelihood especially among affected vulnerable groups including low-income households, informal sector workers and workers in affected industries. In addition, the pandemic has exacerbated the digital divide in online education access, decreased access to healthcare for non-Covid patients and worsened mental health issues due to uncertainty, isolation and overcrowding. Moving towards recovery, there is a need to move towards a more targeted approach, not just broad-based cash transfers.

Dr. Carmelo Ferlito, the CEO of Center for Market Education then presented on ‘Urban Poverty: Strategy and Solution Directions’. He proposed a new strategy towards urban poverty eradication including promoting growth and entrepreneurship, which promotes job creation. Key elements which facilitate entrepreneurship include political stability, fair taxation, a belief in free trade and free movement in people and education reforms centred on rediscovering the role of humanities.

In overcoming a dependency on aids and subsidies (which should be accompanied by a more comprehensive strategy to move the poor out of the need for aids), targeted assistance should instead promote social mobility. Dr Carmelo also emphasized on the need for decentralization as there is a closer understanding to the reality on the ground at the local level, emphasizing the importance of bottom-up responses to the problem of poverty.

Prof. Datuk Dr. Denison Jayasooria, Honorary Professor at Institute of Ethnic Studies (KITA) expounded on how social protection is lacking and social support systems have broken down in his presentation on ‘The New Paradigm in Urban Poverty Eradication’. He also highlighted the need for inter-ministry action, and greater coordination of efforts to overcome urban poverty. In emphasizing that the poor are resilient and hardworking, he highlighted that respect is fundamental and the willingness to consult and hear the views of the poor is highly important.

During the panel discussion moderated by Cellini Basri, analyst of Bait Al Amanah, the need to instil dignity through empowerment was reiterated. Wan Ya Shin highlighted that the objective of poverty eradication is lifting the poor out of poverty, so that they can graduate from the programmes and become agents of change.

The panellists also highlighted the importance of improving the quality of life in Malaysia’s rural areas, to incentivise the organic process of urban to rural migration. Rural rejuvenation here includes enhancing infrastructure, connectivity, quality of schooling and healthcare services.

His Excellency Mr. Pascal Gregoire, Ambassador of Belgium to Malaysia highlighted in his closing remarks, that we should never compromise on having anyone left behind. “It is a shame that we still have urban poverty and rural poverty in a world of abundance today”.

All in all, this webinar has successfully raised awareness and promote the discussion on radical ways in which we can address the plight of those whose sufferings have often been left untold.

**The Center for Market Education (CME) is a boutique think-tank based in Kuala Lumpur, Malaysia. As an academic and educational institution, CME aims to promote a more pluralistic and multidisciplinary approach to economics and to spread the knowledge of a sounder economics, grounded in the understanding of market forces.

**Bait Al Amanah (House of Trust), as an independent research institute helps improve policy and decision-making process through sound, independent, and multidisciplinary research and analysis. Bait Al Amanah also provides consulting services in Political & Economic Risk, Leadership, Social Development & Sustainability and Media, Big Data, & Technology.

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