Low and medium countries across the world, which are battling extreme poverty including Nigeria, may need upward of 100 years to end the scourge, the World Bank has suggested.

A person is defined as poor if he lives on less than N10,275 or $6.85 per day. However extreme poverty refers to those who live below $2.15 or N3,225 per day.
The latest projections are contained in the ‘Poverty, Prosperity and Planet Report’, which offers the first post-Covid assessment of global progress toward ending poverty and increasing prosperity.

The report also submitted that ending extreme poverty, which is prevalent in developing economies by 2030 is no longer achievable, saying achieving that target may take another three decades.

“The global goal of ending extreme poverty – defined as $2.15 per person per day – by 2030 is out of reach: it could take three decades or more to eliminate poverty at this threshold, which is relevant primarily for low-income countries,” the report stated.

Almost 700 million people or 8.5 per cent of the global population live on less than $2.15 per day, while 7.3 per cent of the population is projected to be trapped in extreme poverty by 2030.

Extreme poverty remains concentrated in countries with historically low economic growth, many of which are in sub-Saharan Africa. About 44 per cent of the world’s population live on less than $6.85 per day, which is considered the poverty line for upper-middle-income countries.

Assessing the scenario, the World Bank Senior Managing Director, Axel van Trotsenburg, said: “After decades of progress, the world is experiencing serious setbacks in the fight against global poverty, a result of intersecting challenges that include slow economic growth, the pandemic, high debt, conflict and fragility, and climate shocks.”

Also, the Chief Economist of the World Bank Group and Senior Vice President for Development Economics, Indermit Gill, said low-income countries and emerging market economies should place a higher premium on sustained investments in education and health to provide higher poverty and prosperity-related payoffs than do tax-financed social assistance programmes.

In a related development, the October 2024 Fiscal Monitor of the International Monetary Fund (IMF) noted that large spending pressures, optimism bias of debt projections and sizable unidentified debt are pushing national debts into a figure that is not known.

While the global public is above $100 trillion, which represents about 93 per cent of global gross domestic product (GDP) by the end of this year, may exceed 100 per cent of GDP by 2030.

The figure is 10 percentage points of GDP above the pre-pandemic period before 2019. While the picture is not homogeneous – public debt is expected to stabilise or decline for two-thirds of countries, the October 2024 Fiscal Monitor of the IMF shows that future debt levels could be even higher than projected.

Taming global debt, therefore, requires larger fiscal adjustments than currently projected to stabilise or reduce it with a high probability.The report argued that countries, especially developing ones such as Nigeria, Ghana, South Africa and Bangladesh, should confront debt risks now with carefully designed fiscal policies that protect growth and vulnerable households, while taking advantage of the monetary policy easing cycle.

While acknowledging that weaker growth, tighter financing conditions, fiscal slippages and greater economic and policy uncertainty, the report noted that countries are increasingly vulnerable to global factors affecting their borrowing costs.

The Guardian