CONTENTS FRONT Preface x Acknowledgments vii Partners xii Users guide xx 1. WORLD VIEW Introduction 1 Tables 1. Size of the economy14 1.2 mMillennium Development Goals: eradicating poverty and saving lives 18 1.3 Millennium Development Goals: protecting our common environment 22 1.4 Millennium Development Goals: overcoming obstacles26 1.5 Women in development 28 1.6 Key indicators for other ecpnomies 32 Text figures, tables, and boxes 1a. Developing economies had their best decade of growth in 2000-07 2 1b. Long:term trends reached new heights 2 1c. Most developing economy exports go to high-income ecpnomies 2 1d. Increased investment led to faster growth in low- and middle-income economies2 1e. Large current account surpluses and deficits were concentrated in a few economies during 2005-07 3 1f. Current account surpluses and deficits increased 3 1g. Trade surpluses led to large build-ups in reserves 3 1h. Trade deficits were financed by foreign investors 3 1i. Private capitaj flws to developing economies took off in 2002 .. 4 1j. .. And investors perceived less risk 4 1k. Prices of assets, especially in real estate, were rising rapidly in some countries .. 4 1l. .. And so were equity asset valuations 4 1m. Indebtedness ratios have improved for most economies 5 1n. Growing reserves comfortably covered short-term debt liabilities 5 1o. Commodity price rises accelerated in recent years . 5 1p. Food and fue' importers were hurt by rising prices 5 1q. Output in the largest economies slowed or declined in the 4th quarter of 2008 6 1r. U.S. household debt rose rapidly after 2000 6 1s. U.S. house prices peaked in 2006 6 1t. As housing bubbles burst, investors lost confidence 6 1u. Savings and investment in China . . . 7 1v. ..And tne United States 7 1w. The five largest current account surpluses and deficits 7 1x. U.S. foreign assets and liabilities doubled7 1y. Assets underlying over the counter derivatives rose sevenfold 8 1z. . . . While the market value of derivatives rose ninefold 8 1aa. U.S. domestic financial sector profits averaged almost 30 percent of before-tax profits during 2000-06 8 1bb. Derivatives can undermine capital controls, leading to linkages that make market dynamics difficult to predict 8 1cc. The number of banking crises rose after the 1970s 9 1dd. The latest crisis is affecting a large portion of global income 9 1ee. The cost of systemic financial crises can be very high 9 1ff. Borrowing costs have climbed, reflecting perceived risk 10 1gg. Equity markets have suffered large losses 10 1hh. Low-income economies depend the most on official aid, workers' remittances, and foreign direct investment 10 1ii. Remittances are significant for many low-income economies10 1jj. Fiscal positions have generally improved but remain weak for some developing economies 11 1kk. Finding fiscal space in low-income economies11 1ll. Recent World Bank Group initiatives 11 1.2a. Location of indicators for Millennium Development Goals 1-4 21 1.3a. Location of indicators for Millennium Development Goals 5-7 25 1.4a. ocation of indicators for Millennium Development Goal 8 27 2. PEOPLE Introduction 35 2.1. Population dynamics 40 2.2. Labor force structure 44 2.3. Employment by economic activity 48 2.4. Decent work and productive employment 52 2.5. Unemployment 56 2.6. Children at work 60 2.7. Poverty rates at national poverty lines 64 2.8. Poverty rates at international poverty lines 67 2.9. Distribution of income or consumption 72 2.10. Assessing vulnerability and security 76 2.11. Education inputs 80 2.12. Participation in education 84 2.13. Education efficiency 88 2.14. Education completion and outcomes 92 2.15. Education gaps by income and gender 96 2.16. Health systems 98 2.17. Disease prevention coverage and quality 102 2.18. Reproductive health 106 2.19. Nutritipn 110 2.20. Health risk factors and future challenges 114 2.21. Health gaps by Income and gender 118 2.22. Mortality 122 Text figures, tables, and boxes 2a. Different goals - different progress 35 2b. What is decent work? 36 2c. Employment to population ratios have not changed much over time 36 2d. . . . But variations are wide across regions 36 2e. High employment to population ratios in some countries reflect high numbers of working poor 37 2f. Fewer women than men are employed all over the world37 2g. Many young people are in the workforce, at the expense of higher education 37 2h. For many poor countries, there is a tradeoff between education and employment 37 2i. Although there are large regional variations in vulnerable employment 38 2j. . . . Women are more likely than men to be in vulnerable employment 38 2k. Share of working poor in total employment is highest in South Asia and Sub-Saharan Africa38 2l. Labor productivity has increased across the world 38 2m. Scenarios for 2008 39 2.8a. Children work long hours 63 2.8a. While the number of people living on less than .25 a day has fallen, the number living on .25- .00 a day has increased 69 2.8b. Poverty rates have begun to fall 69 2.8c. Regional poverty estimates 70 2.9a. The Gini coefficient and ratio of income or consumption of the richest quintile to the poorest quintiles are closely correlated 75 2.15a. There is a large gap in educational attainment across gender and urban-rural lines 97 2.16a. There is a wide gap in health expenditure per capita between high-income economies and developing economies 101 3. ENVIRONMENT Introduction 127 Tables 3.1. Rural population and land use 134 3.2. Agricultural inputs 138 3.3. Agricultural output and productivity 142 3.4. Deforestation and biodiversity 146 3.5. Freshwater 150 3.6. Water pollution 154 3.7. Energy production and use 158 3.8. Energy dependency and efficiency and carbon dioxide emjssjpns 162 3.9. Trends in greenhouse gas emissions 166 3.10. Sources of electricjty 170 3.11. Urbanization 174 3.12. Urban housing conditions 178 3.13. Traffic and congestion 182 3.14. Air pollution 186 3.15. Government commitment 188 3.16. Toward a broader measure of savings 192 Text figures, tables, and boxes 3a. Energy use has doubled since 1971 128 3b. High-income economies use almost half of all global energy 128 3c. The top six energy consumers use 55 percent of global energy 128 3d. High-income economies use more than 11 times the energy that low-income economies dp 128 3e. Nonrenewable fuels are projected to account for 80 percent of energy use in 2030-about the same as in 2006 129 3f. Fossil fuels will remain the main sources of energy ! through 2030 129 3g . Known global oil reserves and countries with highest ! endowments in 2006 129 3h. Production declines from existing oil fields have been rapid 129 3i. Economic activity, energy use, and greenhouse gas emissions move together 130 3j. Decarbonization of energy reversed at the beginning of the 21st century 130 3k. The top six carbon dioxide emitters in 2005 130 3l. High-income economies are by far the greatest emitters of carbon dioxide 130 3m. Carbon dioxide emissions embedded in international trade 131 3n. Impact of Policy Scenarios: carbon dioxide concentration, temperature increase, emissions, and energy demand 131 30. Reductions in energy-related carbon dioxide emissions by region in the 550 and 450 parts per million Policy Scenarios relatjye to the Trend Scenario 131 3p. Energy efficieny has been Improving132 3q. Electricity generated from renewables is projected to more than double by 2030132 3r. Top 10 users of wind to generate electricity 133 3s. Post and savings under the Policy Scenarios 133 3.1a. What is rural? Urban?137 3.2b. Nearly 40 percent of land globally is devoted to agriculture 141 3.2c. Developing regions lag in agricultural machinery, which reduces their agricultural productivity 141 3.3d. Cereal yield in low-income economies was less than 40 percent of the yield in high-income countries 145 3.3e. Sub-Saharan Africa had the lowest yield, while East Asia and Pacific is closing the gap with high-income economies 145 3.5a. Agriculture is still the largest user of water, accounting for some 70 percent of global withdrawals 153 3.5b. The share of withdrawals for agriculture approaches 90 percent in some developing regions 153 3.6a. Emissions of organic water pollutants declined in most economies from 1990 to 2005, even in some of the top emitters 157 3.7a. A person in a high-income economy uses an average of more than 11 times as much energy as a person in a low-income economy 161 3.8a. High-income economies depend on imported energy165 3.8b. . . . mostly from middle-income economies in the iddle East and North Africa and Latin America and the Caribbean 165 3.9a. The 10 largest contributors to methane emissions account for about 62 percent of emissions 169 3.9b. The 10 largest contributors to nitrous oxide emissions account for about 56 percent of emissions 169 3.10a. Sources of electricity generation have shifted since 1999 . . . 173 3.10b. ..with developing economies relying moreon coal 173 3.11a. Developing economies had the largest increase in urban population between 1990 and 2007 177 3.11b. Latin America and the Caribbean had the same share of urban population as high-income economies in 2007 177 3.12a. Selected housing indicators for smaller economies 181 3.13a. Particulate matter concentration has fallen in all income groups, andI the; higher trie income, the lowerthe concentration 185