The rate of extreme poverty in the Middle East and North Africa (Mena) region nearly doubled between 2015 and 2018, a new World Bank report says.
The Washington-based lender’s biennial Poverty and Shared Prosperity report shows extreme poverty in the Mena region increased to 7.2 per cent in 2018 – the latest year for which data is available – up from 3.8 per cent in 2015. This was the second successive increase in extreme poverty, which had climbed from 2.3 per cent in the period up to 2015. The lender defines extreme poverty as living on less than $1.90 a day.
“These sobering new figures are a wake-up call for how significantly conflict, climate change, poor governance – and now the Covid-19 pandemic – combine to devastate lives, livelihoods, and region-wide prosperity,” said Ferid Belhaj, World Bank vice president for the Mena region.
“We are continuing to help Mena countries stop the spread of the disease and protect and care for their people. At the same time, we are committed to helping the people of Mena build a new social contract, where transparency, governance, the rule of law and regional integration can alleviate poverty and give everyone, in every country, a chance to achieve their aspirations,” he added.
This latest jump in poverty was largely driven by the effects of conflicts in Syria and Yemen, but precludes Lebanon’s economic collapse and the economic fallout from Covid-19. The World Bank said the dual shocks of the pandemic and lower oil prices have exacerbated structural issues and deepened pre-existing vulnerabilities in social, political and economic systems. It is expected to cost the region’s economy about $100bn, or 3.7 per cent of gross domestic product.
As a result, at least three million more people are expected to be pushed into extreme poverty, increasing the regional percentage to 7.9 per cent. In the short run, rates could be even higher in certain countries.
“The pandemic is creating a group of new poor who had previously been relatively spared – those in urban areas and small and informal business owners are particularly impacted,” said Nadir Mohammed, the World Bank’s regional director for equitable growth, finance and institutions.
“Unemployment, already exceptionally high before the Covid-19 pandemic, has worsened and reduced the already very limited job prospects for the region’s youth and women. Phone surveys show that families are depleting their savings and that food insecurity is on the rise.”
The lender said it has embarked on a multi-phase response to the pandemic, with about $700 million being provided in the first phase to support urgent public health needs. It is also helping countries to expand social safety nets, including cash transfers for the most vulnerable, and support for small businesses to provide a lifeline for informal workers.
On Wednesday, it warned the pandemic will push 150 million people around the world into extreme poverty by next year – the first increase in global extreme poverty since 1998.
Updated: October 10, 2020 09:21 PM