World Bank warns of COVID impacts on global poverty

The COVID-19 pandemic is expected to push as many as 150 million more people into extreme poverty by 2021, the World Bank says, marking the first time in 20 years that the number of those in such poverty will rise.

The pandemic “compounds the forces of conflict and climate change” that were already putting at risk the gains in reducing extreme poverty, defined as living on less than US$1.90 per day. Those affected amount to between 9.1 and 9.4 percent of the global population, rather than an expected drop to 7.9 percent this year.

“The pandemic and global recession may cause over 1.4 percent of the world’s population to fall into extreme poverty,” said World Bank chief David Malpass, as the organization released its full report Tuesday.

“In order to reverse this serious setback to development progress and poverty reduction, countries will need to prepare for a different economy post-COVID, by allowing capital, labor, skills, and innovation to move into new businesses and sectors,” Malpass said.

The news is especially troubling for sub-Saharan Africa, where half of all economies have poverty rates higher than 35 percent. Of the 20 global economies with the highest poverty rates, 18 are in sub-Saharan Africa – and the World Bank report finds that many of the expected “new poor” will be in countries that already have high poverty rates.

“In addition to the $1.90-per-day international poverty line, the World Bank measures poverty lines of $3.20 and $5.50, reflecting national poverty lines in lower-middle-income and upper-middle-income countries,” the World Bank said.

The complete report, available here, calls for international action to ensure years of progress are not erased.

Image: World Bank

source: https://africatimes.com/2020/10/07/world-bank-warns-of-covid-impacts-on-global-poverty/

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