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Digital Subscriptions > Development Finance > Development Finance > The Forgotten Billion?

The Forgotten Billion?

Ten years after the publication of The Bottom Billion, Jack Aldane met with the author Sir Paul Collier to discuss the impact his first book had at a time of global upheaval. Collier offers his reflections on the current state of development finance and how the past decade has changed his perspective as an author
Sir Paul Collier, Professor of Economics and Public Policy at the Blavatnik School of Government
© John Cairns

“And so I say, let 2008 be the year of the bottom billion.”

Ban Ki Moon’s first New Year’s message as the United Nations’ secretary general had been building up to this moment. His pledge was to raise the income of the world’s poorest to more than one dollar a day.

As the media listened from within the UN’s headquarters in New York, the inflated US housing market was turning radioactive. Nine months later, Wall Street banks that together held more than US$8 trillion in mortgage-backed securities would race to shed their toxic assets. The resulting systemic failure produced the worst global financial crisis since the Great Depression. By December of 2008, “bottom” and “billion” reflected the status and losses of banks with firms like Lehman Brothers filing for bankruptcy with debts of US$630 billion, around 20 times the GDP of the Democratic Republic of Congo. It was the start of a new era in which stagnant growth, hyper-connectivity and the decline of Western dominance would reconstitute the UN’s task of charting a forward path for international policy. Moon’s image as the doyen of diplomacy, whose Confucian good nature and benign smile the media liked to caricature, was later derided in the press with the nickname: “invisible man”. Yet the bottom billion had not disappeared.

A new approach to poverty alleviation

The phrase in Moon’s speech was coined from a book of the same title published a year earlier. Its author Paul Collier had dedicated the book to his then six-year-old son, Daniel. The Bottom Billion won broad acclaim for its concise analysis of extreme poverty in the 21st century. Its neatly sewn together argument for a better approach to aid policy followed years of research compiled by Collier and his field partner Anke Hoeffler. Together, the pair outline four poverty traps that stop fragile states from achieving even modest growth. These include the trap of living with abundant natural resources; of being landlocked by other fragile states; of living with bad governance, and as recent events in the Democratic Republic of Congo show, the trap of living in recurrent states of conflict.

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