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While Poverty in Africa Has Declined, Number of Poor Has Increased
Latest Issue: 
  • March 2016

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STORY HIGHLIGHTS
  • A new World Bank report shows that poverty in Africa may be lower than current estimates suggest and no systematic increase in inequality, given the available data
  • Challenges remain substantial: more people are poor today than in 1990, two in five adults are still illiterate, and violence is on the rise
  • Improving the coverage, comparability and quality of poverty and inequality data in Africa will be equally important

Poverty across the continent may be lower than what current estimates suggest, though the number of people living in extreme poverty has grown substantially since 1990, according to the latest World Bank Africa poverty report.

Poverty in a Rising Africa, the first of two upcoming reports on poverty in Africa, documents the data challenges facing the region and reviews the status of Africa’s poverty and inequality, both monetary and nonmonetary, taking these data challenges into account.

“The main messages which emerge from this effort to assess poverty in Africa are both encouraging and sobering,” said Kathleen Beegle, World Bank program leader and co-author of the report. “Although the data show that the share of the African population in extreme poverty did decline, major poverty challenges still remain, especially in light of the region’s rapid population growth.”

According to latest World Bank estimates, the share of Africans who are poor fell from 56% in 1990 to 43% in 2012. The report argues that the poverty rate may have declined even more if the quality and comparability of the underlying data are taken into consideration. However, because of population growth many more people are poor, the report says. The most optimistic scenario shows about 330 million poor in 2012, up from about 280 million in 1990. Poverty reduction has been slowest in fragile countries, the report notes, and rural areas remain much poorer, although the urban-rural gap has narrowed.

Other key findings of the report are: 

  • Nonmonetary dimensions of poverty have been improving, but the challenges remain enormous. Compared with 1995, adult literacy rates are up by four percentage points and the gender gap is shrinking. Newborns can expect to live six years longer and the prevalence of chronic malnutrition among under five-year-olds is down six percentage points to 39%. At the same time, despite substantial improvement in school enrollment, the quality of schooling is often low and more than two in five adults are still illiterate. Reinvigorating Africa’s primary educational achievements is urgent. Paradoxically, citizens in resource-rich countries have worse outcomes in human welfare indicators, conditional on income. This findings underscores that while economic growth is critical for poverty reduction, it is not sufficient.
  • The picture on African inequality is complex. Seven of the 10 most unequal countries in the world are in Africa, most of them in southern Africa. Excluding these countries and controlling for GDP levels, inequality is not higher in Africa than elsewhere in the world. The household survey data do not reveal a systematic increase in inequality across countries in Africa. But the number of extremely wealthy Africans is increasing. Differences between urban and rural areas and across regions are large. Intergenerational mobility in education and occupation has improved, but remains low. 

The report concludes with a plea to strengthen Africa’s poverty data. While the availability, comparability and quality of data to track non-monetary poverty has improved, in 2012, 25 of Sub-Saharan Africa’s 48 countries had conducted at least two household surveys over the past decade to track monetary poverty, and many of these surveys are not comparable over time. On October 15, the World Bank and its partners announced stronger support to complete household-level surveys every three years in the world’s poorest countries, including several in Africa, to address huge data gaps that have previously stunted poverty-fighting efforts.

“Better data will make for better decisions and better lives,” said Luc Christiaensen, World Bank lead economist and co-author of the report. “It is not just about quantity, the quality of the data also matters. The report offers examples of missed opportunities when surveys are not conducted with quality standards. Maintaining and accelerating the momentum of progress of the past two decades requires collective efforts.”