This is exactly the same argument that was often used to justify slavery in the US and after all these years it's still not compelling. Ending slavery in the US didn't "lead to worse problems", it was a massive improvement.

People who are free may thrive or struggle, but they'll do it without a master which is always an improvement. There are no solutions to those deeper problems that impact people in poverty which would be prevented by freeing them from exploitation. If you want people's situation to improve, why not do both?