Poverty in Africa Must be Quantified before It Can Be Defeated

October 20, 2015

Makhtar Diop, World Bank's Vice President for Africa Le Monde

Although Sub-Saharan Africa experienced growth rates in recent decades that would be the envy of developed countries, living conditions among African populations have not demonstrated the same improvement. Based on the most recent World Bank estimates, the percentage of Africans living in extreme poverty fell from 56 percent in 1990 to 43 percent in 2012: a decline that is encouraging, but clearly insufficient. In terms of poverty reduction, Africa is willing and able to do better.

This decline in the poverty rate in Africa masks a reality that is hard to ignore: because of rapid population growth, Africa is now the region with the highest concentration of poor. Based on our most optimistic projections, while there were 280 million poor in Africa in 1990, this number rose to 330 million in 2012. In 1990, East Asia was home to half of the world's poor; Sub-Saharan Africa accounted for a mere 15 percent of the total at that time. The trend has since reversed, because the majority of African countries continue to demonstrate fertility rates of four children or more. 

What are the figures hiding?

"Poverty in a Rising Africa," a new World Bank report published yesterday, assesses the poverty and inequality situation in Africa based on available data. In the absence of reliable statistics, this is a complicated task. In 2012, only 25 of 48 Sub-Saharan African countries had conducted at least two household consumption surveys in the previous decade. The lack of reliable and comparable data also masks realities that are more complex given that Africa is anything but a homogenous continent.

A country like Ghana, for example, one of the few African countries that conducts household surveys regularly, has seen a dramatic decline in its poverty rate, which fell from 50 percent of the population in 1991 to 21 percent in 2012. It is hardly surprising that populations in conflict-affected countries continue to bear a heavy burden, with fragile or conflict-affected states demonstrating a drop in poverty of less than 15 percentage points compared to other African countries during the period studied. Paradoxically, citizens of countries rich in natural resources seem less well off than others—proof, if necessary, that economic growth is a necessary but not a sufficient condition to combat poverty. More equitable distribution of wealth is the missing factor in this equation.

Non-monetary poverty indicators are also on the rise, according to the report data. For example, the adult literacy rate rose by 4 percentage points, life expectancy increased by six years, and the prevalence of malnutrition in children under five declined by six points. However, ensuring the well-being of African populations also entails strengthening social safety nets, a fact of which African leaders are aware, with more and more states establishing effective social protection systems. The fundamental role played by women in poverty reduction efforts is recognized, and women are having greater input in the political and economic spheres in African countries.

With regard to inequality, the picture is a bit more complex:  seven of the ten countries with the highest levels of inequality are in Africa.  However, if these countries are excluded, and if GDP levels are taken into account, inequality does not seem higher in Africa than elsewhere. Yet, we expect to see a dramatic increase in the number of very wealthy Africans, and large disparities exist between urban and rural areas and between regions within individual countries.

These data help us paint a portrait of a continent with many faces and interpret this apparent paradox of a thriving continent that, nevertheless, cannot yet made a sufficiently large dent in its poverty rates. More than ever, developing a reliable database on Africa is critical to poverty reduction efforts. To this end, at the launch of this report on poverty in Sub-Saharan Africa, the World Bank announced an initiative that will help 78 of the world's poorest countries—more than half of which are located in Africa—conduct quality household surveys every three years.

The availability of improved data on poverty trends will help governments implement more appropriate policies and empower citizens to put pressure on their governments to commit to poverty reduction efforts.

Investing in agriculture and renewable energy to fight poverty

Every year between 2015 and 2035, close to 5 million more people will turn 15 years of age, thereby crossing the threshold of childhood into adolescence, while in the rest of the world, the population will grow older. Is this a demographic boon or a ticking time bomb? One thing is certain: Africa will not be able to win its fight against poverty unless it invests heavily in human capital and creates jobs for young people.

Led by the boom in commodity prices, growth in Africa has been accompanied by a significant increase in productivity in the sectors on which the most vulnerable populations depend for their survival. In order to reduce poverty, the agricultural sector cannot be neglected. The reason for this is simple: more than three quarters of the poor in Africa work in agriculture. In a country like Rwanda, it is estimated that expansion of agricultural production contributed to a 35 percent reduction in poverty over the past 10 years. Agriculture represents a golden opportunity for Africa, with its abundance of fertile lands, water, and labor.

Falling commodity prices and slowing growth in 2015 offer African countries a unique opportunity to intensify poverty reduction efforts by implementing reforms aimed at stimulating agricultural productivity and expanding access to reliable and affordable electricity to vulnerable populations. It would, in fact, be wishful thinking to believe that we will succeed at curbing poverty in Africa without ending energy poverty. Only one African in three today has access to electricity, and without massive investments (estimated at US$40 billion per year), fewer than six Africans in ten will have access to electricity in 2030. These figures speak volumes.

As COP21 approaches, the time has come to mobilize efforts to place Africa at the center of the global climate strategy given that climate change disproportionately affects the most vulnerable populations on the continent. Africa possesses some of the greatest hydroelectric and geothermal potential in the world, considerable natural gas reserves, and abundant solar resources. It can therefore contribute to the global public good of combating climate change while striving to curb poverty for its people. 

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