With 1.2 billion people forced to survive on less than $1 per day, world poverty remains a daunting challenge for us all. But while there is little disagreement about the urgency of the task of poverty reduction, consensus on how to achieve meaningful progress sometimes appears beyond reach.

The poverty reduction debate often is cast in terms of two opposing camps: "globalizers" and "anti-globalizers". But this dichotomy appears detached from the real discussion of the needs of the developing world. Prague's citizens will recall only too well the violent street protests that marred the 2000 IMF-World Bank Annual Meetings. What is often forgotten is that the meetings also saw sincere dialogue between heads of state, the international financial institutions, and civil society organizations over the poverty reduction effort. In the past two years, we at the IMF have intensified the dialogue with our critics—and there have been concrete results. Our participation in the "Bridging Global Gaps" conference here in Prague this week is part of this effort to broaden a substantive dialogue.

There are those who believe that globalization itself is to blame for the plight of the world's poor. But reversing the process of globalization will not solve the problem of poverty. That was amply demonstrated during the first half of the 20^th century, when protectionism and aggressive nationalism brought depression and world war. Since 1945, the commitment to economic cooperation and integration has been renewed, resulting in a tripling of global per capita income and major improvements in life expectancy worldwide. The fall of the Berlin Wall in 1989 provided another powerful impetus to the process of democratization and economic integration. After some difficult years of transition, most countries in Eastern and Central Europe are now enjoying improved living standards and many will soon be joining the European Union.

We at the IMF believe that economic growth is the best way to maintain these trends and to achieve meaningful poverty reduction. But we also recognize that participation in the global economy carries risks and uncertainties. Thus, we see our work as an important part of the effort to make globalization work for all. We believe that the fight against poverty should be centered on the principle of "help for self-help". This two-pillar approach is reflected in the so-called Monterrey Consensus, reached at the March 2002 United Nations conference on financing for development. That consensus encourages low-income countries to pursue sound policies and good governance, and the international community to respond with faster and more comprehensive support.

It is encouraging to see that important progress has been made in some of the world's poorest countries in recent years. In 13 countries in Africa, real growth of gross domestic product has averaged more than 5 percent per year since 1997. Mozambique and Uganda, once devastated by war, are now among the most rapidly growing countries in Africa. In Burkina Faso, policies to increase agricultural production and cotton exports have led to faster economic growth and higher incomes for the rural poor. In Botswana and Cameroon, revenue from the sale of diamonds and oil is being used to develop stronger, more diversified economies. And efforts in Mauritius and Tanzania to strengthen private business have already been rewarded with increased foreign investment.

The IMF is assisting the governments of these and other countries in their efforts to build a better future. We encourage the development of poverty reduction strategies and have approved US$3.5 billion in subsidized loans to low-income countries in Africa. In cooperation with the World Bank, we have also helped 26 African countries qualify for US$41.5 billion in debt relief under the enhanced Initiative for Heavily Indebted Poor Countries. This debt relief has produced measurable benefits: spending on health, education and other social services is rising in these countries.

But to achieve meaningful poverty reduction, all of Africa needs sustained economic growth of at least 7 percent per year to produce new jobs and new sources of income. This is ambitious, but not impossible. To achieve this, it is critical that African countries be given better opportunities to expand and diversify their exports.

Recently, there have been welcome initiatives from the European Union and the United States to improve market access for low-income countries. But these initiatives clearly are not sufficient: industrial countries still spend more than US$300 billion each year on agricultural subsidies alone. Poor nations can only make significant progress if the rich nations undertake the politically challenging task of subsidy reform. Industrial countries have encouraged the developing countries to liberalize their trade for decades. It is time they applied the same lesson to their own economies.

Aid is another area where more needs to be done. While a recent G8 plan to increase assistance to Africa is welcome, most industrial countries still fall far short of meeting the UN target of official development assistance equal to 0.7 percent of gross national product. Getting just half-way to that target would provide more than the US$10 billion that the UN has estimated will be required on an annual basis to respond to the AIDS epidemic that is ravaging the continent. It would also allow Africa to devote more resources to poverty alleviation and would enable it to respond more effectively to natural disasters, such as this year's droughts.

The IMF welcomes the ongoing debate about globalization, which we see as an opportunity to clarify the costs and benefits of global economic integration. Ultimately, what is needed is not less globalization, but better globalization. To achieve this, we need to work much harder to make it more inclusive.

Civil society has an important role to play in this regard. Nongovernmental organizations played an important role in putting debt relief for low-income countries on the development agenda. The challenge before them now is to do the same for trade and aid. Only a concerted global effort can bring real improvement into the lives of the world's poor. It is essential that we all work together to make progress where it is most needed.