By Jorn Madslien BBC News Online business reporter

Educated children are more productive later in life

Educating children, rather than forcing them to work, could yield enormous economic benefits for developing nations, according to the International Labour Organisation (ILO).

Paying for a child's education could bring a sevenfold return on the investment, in addition to social and other benefits that make this a preferred option to child labour, the ILO said.

"We often get asked the question: 'Is it economically viable to make the switch from child labour to education?'," Frans Roeselaers, director of the ILO's International Programme on the Elimination of Child Labour told BBC News Online.

And, added Mr Roeselaers, the answer is clear.

"It gives enormous, almost astronomical returns in terms of both productivity and increased wages once the child grows up and becomes a worker," he said.

Companies and nations stand to benefit from increased productivity, while higher salaries would benefit both the workers and their families, as well as governments who would get higher tax revenues.

In addition, removing the worst forms of child labour, such as prostitution and slavery, would reduce illnesses and injuries.

This would cut the cost of treating the children and make them better able to continue working for many more years.

Hurdles

But future earnings, however large, may not be enough to convince poverty struck families to stop sending children to work in order to secure food on the table today.

Learning to read pays real dividends

Indeed, investment in children's education involves "considerable costs upfront", Mr Roeselaers acknowledged.

Initially, there will be "a protracted period, approximately 15 years, of net costs", he said.

"But the costs are complete after a couple of decades, and the benefits continue for 40 years past that point."

Consequently, it "requires great commitment from both families and governments" to provide education rather than jobs for the young.

Families will have to go without their children's income for several years, a choice many poor parents will be unable to make without help.

Assistance

Governments must therefore step in, Mr Roeselaers insisted.

Families need help to cope without their children's wages

"This is primarlily a political rather than economic question," he said.

The ILO would like to see national governments introduce so-called "income transfer programs" to compensate families for lost earnings when their children leave work in order to get an education.

Some countries, most notably India, Brazil and Mexico, are already operating such schemes.

"These programmes would target all families with school-age children now living in poverty," Mr Roeselaers said.

Such programmes should take into account:

• the average value of a child's work
• the number of children per household
• the degree of household poverty

Government investment

Beyond helping individual families, governments must also invest in new schools, books and equipment, and they must educate more teachers.

Asia, which has the highest number of child workers, stands to benefit the most from such investment since teacher wages here are relatively low and since the region's "educational infrastructure is already quite good", Mr Roeselaers said.

Sub-Saharan Africa, meanwhile, where child workers are the most prolific in terms of their proportion of the total labour force, would have to invest more initially to build and upgrade schools and to educate teachers.

But even in Africa, the return on investment in education would be huge, Mr Roeselaers insisted.

African countries would gain around $5 for every $1 invested, while Asian countries would get back more than $7 for every $1.

In terms of the overall effect on the economy, however, Africa stands to benefit the most by following the ILO suggestions.

Saving nations

The poorer a country is, the greater the economic benefits, according to the ILO's research.

As a percentage of annual gross national product (GNP), Sub-Saharan Africa could experience a gain of more than 50%, while Asia, North Africa and the Middle East could see improvements in the range of 22% to 28%.

In Central and Eastern Europe, the gains would amount to about 5% of GNP.