Report: Economic Lockdowns Could Force 150 Million Into Extreme Poverty
Up to 150 million people could slip into extreme poverty, living on less than $1.90 a day, by late next year depending on how badly economies shrink during coronavirus lockdowns, the World Bank said Wednesday.
Middle income countries are expected to have 82 percent of the new extreme poor, including India, Nigeria and Indonesia.
Many of the new extreme poor will be more educated urban residents, meaning cities will see an increase in the kind of poverty traditionally rooted in rural areas.
Most of the new extreme poor, more than 110 million even by the World Bank’s baseline estimate, will be in South Asia and sub-Saharan Africa.
Economic lockdowns have abruptly halted years of progress against global extreme poverty, expected to rise this year for the first time in over two decades.
Global economic growth is expected to fall by 5.2 percent this year, more than in the past eighty years.
Almost a quarter of the world’s population lives below $3.20 a day, a massive number of people vulnerable to the kind of economic shocks that this year have come in waves.
Unemployment is rising, and those who scraped together savings have watched them disappear. Families are eating less. Many children, who account for half of the world’s poor, are missing out on education.
“Many of the new poor are likely to be engaged in informal services, construction and manufacturing — the sectors in which economic activity is most affected by lockdowns and other mobility restrictions,” the report says, citing phone surveys in countries around the world.
Recovery, experts say, could take a decade — a shattering blow to people who had pulled themselves out of poverty and saw a better life ahead.
Developing countries are seeking more assistance from the World Bank, other financial institutions and richer governments.
“If the global response fails the world’s poor and vulnerable people now, the losses they have experienced to date may be dwarfed by what lies ahead,” the report says. “We must not fail.”
In Africa, some countries had made “impressive strides” against poverty and several had some of the world’s fastest-growing economies before the lockdowns.
Now Africa’s 54 countries say they need $100 billion per year over the next three years to fight the coronavirus and its economic effects.
Roughly a third of the newly extreme poor are expected to be in sub-Saharan Africa, between 26 million and 40 million. South Asia, however, will see the largest share, between 49 million and 57 million.
The World Bank estimates between 88 million and 115 million people could slip into extreme poverty this year, with another 23 million to 35 million in 2021.
The Western Journal has reviewed this Associated Press story and may have altered it prior to publication to ensure that it meets our editorial standards.
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