Macroeconomics

23 December 2015

A better world 

Two billion people have moved out of extreme poverty over the past 25 years, and the quality of life worldwide has improved markedly over the same period, according to the UN’s 25th annual Human Development Report.

While the report is nearly 300 pages long, the Human Development Index (HDI) deserves special attention.

A composite index measuring average achievement in three basic dimensions of human development – a long and healthy life, knowledge and a decent standard of living – the HDI ranks 188 countries and territories by aggregate score.

While the top 10 – led by Norway, followed by Australia and Switzerland – have been relatively consistent over the past quarter-century, the 11th country on the list has made remarkable progress.

Since 1980, when the UN set its initial benchmark, Singapore’s median life expectancy has increased by 11 years, average schooling by seven years and per capita income by over $57,000 – from $19,300 to more than $76,600.

Singapore is not the only notable success story. Over the same period and despite the 1994 genocide, Rwanda has made the most progress. Although ranked 163rd overall in the 2015 HDI, Rwanda has seen life expectancy increase by more than 16 years since 1980, while average schooling has doubled. 

Among all indexed countries, only one is less developed than it was a quarter-century ago: Swaziland, which has been ravaged by AIDS. Since 1980, though schooling and incomes have increased slightly, median life expectancy has declined by five years, to just 49 years.

Over a shorter, five-year timeframe, other countries saw their rankings decline. Since 2009, two war-torn nations have witnessed significant regression: Libya is down 27 places and Syria 15 places.

More surprisingly, Jamaica slipped 23 places over the same five-year period, primarily due to a nearly 35% decline in per capita income. 

Overall, the number of people living in countries with very high scores on the HDI has more than doubled, from 500 million to 1.2 billion, though 830 million people are still classified as “working poor,” earning under $2 per day.

The report also highlights that global development is being held back by the relative shortage of women in paid work and the fact that, worldwide, women earn 24% less than men – with an even greater gap in the highest-paying professions. 

The top 20 countries in the 2015 HDI include:

1. Norway

2. Australia

3. Switzerland

4. Denmark

5. Netherlands

6. Germany

6. Ireland

8. United States

9. Canada

9. New Zealand

11. Singapore

12. Hong Kong, China (SAR)

13. Liechtenstein

14. Sweden

14. United Kingdom

16. Iceland

17. South Korea

18. Israel

19. Luxembourg

20. Japan