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Overview

  • The World Bank Group’s goals are to end extreme poverty and promote shared prosperity. This mission underpins our analytical, operational, and convening work in more than 145 client countries. For almost 25 years, extreme poverty — the first of the world’s Sustainable Development Goals — was steadily declining. 

    Now, for the first time in a generation, the quest to end poverty has suffered a setback.

    Global extreme poverty rose in 2020 for the first time in over 20 years as the disruption of the COVID-19 pandemic compounded the forces of conflict and climate change, which were already slowing poverty reduction progress. About 120 million additional people are living in poverty as a result of the pandemic, with the total expected to rise to about 150 million by the end of 2021.

    In 2018, four out of five people below the international poverty line lived in rural areas.

    • Half of the poor are children. Women represent a majority of the poor in most regions and among some age groups. About 70 percent of the global poor aged 15 and over have no schooling or only some basic education.
    • Almost half of poor people in Sub-Saharan Africa live in just five countries: Nigeria, the Democratic Republic of Congo, Tanzania, Ethiopia, and Madagascar.
    • More than 40 percent of the global poor live in economies affected by fragility, conflict and violence, and that number is expected to rise to 67 percent in the next decade. Those economies have just 10 percent of the world’s population.
    • About 132 million of the global poor live in areas with high flood risk.

    Many people who had barely escaped extreme poverty could be forced back into it by the convergence of COVID-19, conflict, and climate change.

     The "new poor" probably will:  

    • Be more urban than the chronic poor.
    • Be more engaged in informal services and manufacturing and less in agriculture.
    • Live in congested urban settings and work in the sectors most affected by lockdowns and mobility restrictions.

    Middle-income countries such as India and Nigeria will be significantly affected; middle-income countries may be home to 82% of the new poor.

    New research estimates that climate change will drive 68 million to 132 million into poverty by 2030. Climate change is a particularly acute threat for countries in Sub-Saharan Africa and South Asia — the regions where most of the global poor are concentrated. In a number of countries, a large share of the poor live in areas that are both affected by conflict and facing high exposure to floods — for example, Nepal, Cameroon, Liberia, and the Central African Republic.

    The newest and most immediate threat to poverty reduction, COVID-19, has unleashed a worldwide economic disaster whose shock waves continue to spread. Without an adequate global response, the cumulative effects of the pandemic and its economic fallout, armed conflict, and climate change will exact high human and economic costs well into the future.

    The latest research suggests that the effects of the current crisis will almost certainly be felt in most countries through 2030. Under these conditions, the goal of bringing the global absolute poverty rate to less than 3 percent by 2030, which was already at risk before the crisis, is now beyond reach without swift, significant, and substantial policy action.

    History shows that urgent and collective action can help us tackle this crisis. 

    Last Updated: Apr 15, 2021

  • The current moment of crisis is extraordinary. No prior disease has become a global threat so quickly as COVID-19. Never have the world’s poorest people resided so disproportionately in conflict-affected territories and countries. Changes in global weather patterns induced by human activity are unprecedented. 

    There is no silver bullet to ending poverty, and strategies to reach the least well-off must be tailored to each country’s context, taking into account the latest data and analysis and the needs of the people. How the world responds to these major challenges today will have a direct bearing on whether the current reversals in global poverty reduction can be turned around. The immediate highest priorities everywhere must be saving lives and restoring livelihoods. Some of the policies needed to achieve this are already in place, such as social protection systems. For example, efforts are well under way in Brazil and Indonesia to expand existing cash transfer programs.

    While addressing COVID-19 is crucial, countries should continue to enact solutions to the ongoing obstacles to poverty reduction. The World Bank provides recommendations for a complementary two-track approach: responding effectively to the urgent crisis in the short run while continuing to focus on foundational development problems, including conflict and climate change.

    • Closing the gaps between policy aspiration and attainment
      Too often there is a wide gap between policies as articulated and their attainment in practice, and thus between what citizens rightfully expect and what they experience daily. Policy aspirations can be laudable, but there is likely to be considerable variation in the extent to which they can be realized, and which groups benefit from them. For example, at the local level, those who have the least influence in a community might not be able to access basic services. At the global level, political economy concerns will be reflected in the extent to which rich and poor nations get access to finite global supplies of medical equipment. It is critical to forge implementation strategies that can rapidly and flexibly respond to close the gaps.

    • Enhancing learning, improving data
      Much about the novel coronavirus remains unknown. The speed and scale with which it has affected the world has overwhelmed response systems in rich and poor countries alike. Innovative responses often come from communities and firms, which may have a better sense of the problems that should be prioritized and may enjoy greater local legitimacy to convey and enforce difficult decisions such as stay-at-home requirements. The faster everyone learns from each other, the more useful it will be. The Republic of Korea’s widely applauded response to COVID-19, for example, has been attributed in part to intentional efforts to learn from its “painful experience” when responding to the Middle East Respiratory Syndrome coronavirus in 2015.

    • Investing in preparedness and prevention
      “Pay now or pay later” may be a cliché, but in the current moment the world is surely learning this lesson again, the hard way. Prevention measures often have low political payoff, with little credit given for disasters averted. Over time, populations with no lived experience of calamity can become complacent, presuming that such risks have been eliminated or can readily be addressed if they happen. COVID-19, together with climate change and enduring conflicts, is reminding us of the importance of investing in preparedness and prevention measures comprehensively and proactively.

    • Expanding cooperation and coordination
      Contributing to and maintaining public goods requires extensive cooperation and coordination. This is crucial for promoting widespread learning and improving the data-driven foundations of policymaking, and for forming a sense of shared solidarity during crises and ensuring that the difficult policy choices by officials are both trusted and trustworthy.

    Overall, with more than 60 percent of the world’s extreme poor living in middle-income countries, we cannot focus solely on low-income countries if we want to end extreme poverty. We need to focus on the poorest people, regardless of where they live, and work with countries at all income levels to invest in their well-being and their future.

    This goal to end poverty works hand in hand with the World Bank Group’s goal to promote shared prosperity, focused on increasing income growth among the bottom 40 percent in every country. Boosting shared prosperity broadly translates into improving the welfare of the least well-off in each country and includes a strong emphasis on tackling persistent inequalities that keep people in poverty from generation to generation.

    Our work at the World Bank Group is based on strong country-led programs to improve living conditions – to drive growth, raise median incomes, create jobs, fully incorporate women and young people into economies, address environmental and climate challenges, and support a stronger, more stable economy for everyone.

    This is no easy task, and the road ahead will not be simple or straightforward, but this is at the core of what we do every day at the World Bank Group, and we will continue to work closely with countries to help them find the best ways to improve the lives of their least advantaged citizens.

    Last Updated: Oct 07, 2020

  • The World Bank Group works to end poverty in several ways:

    • Funding projects that can have transformational impacts on communities
    • Collecting and analyzing the critical data and evidence needed to target these programs to reach the poorest and most vulnerable
    • Helping governments create more inclusive, effective policies that can benefit entire populations and lay the groundwork for prosperity for future generations. 

    Some examples:

    Grow

    • Cambodia has achieved remarkable progress in reducing poverty and boosting shared prosperity, but key reforms are needed to sustain pro-poor growth. The World Bank is supporting Cambodia to help  address the country’s challenges of limited economic diversification, rapidly increasing urbanization, human capital deficiencies, and infrastructure gaps.
    • Mexico has experienced high income inequality and concentration of poverty in a few states. The World Bank Group has supported Mexico’s efforts to develop a more inclusive, effective, and integrated social protection system including relaunching a conditional cash transfer program to help improve access to higher education and formal employment.
    • In one of India’s poorest states, Bihar, a program financed by the World Bank has transformed livelihoods by mobilizing almost 10 million rural women into self-help groups and granting them access to finance and markets to start and expand their businesses.

    Invest

    • A pilot program in Ecuador used text messages to relay information and encouragement to caregivers in an impoverished region of the country and saw a significant improvement in the nutrition and health of children.
    • Since 2007, a team of experts from the World Bank has been helping Kenya strengthen statistical capacity by reshaping its National Bureau of Statistics. With World Bank’s support, the bureau implemented a range of surveys to update key indicators of official statistics and improved the data ecosystem. The project is funded by $50 million from the World Bank’s International Development Association (IDA).
    • In-depth maps in countries such as AfghanistanBangladeshCroatiaRepublic of Serbia, and Vietnam show where economic diversity and gaps in services exist within a country. This, as part of the poverty assessment process, helps policymakers better target policies and programs to reach and benefit the poor.

    Insure

    • Yemen’s high malnutrition rates have drawn global attention, highlighting the impact the country’s five-and-half-year civil war has had on its population. The Emergency Crisis Response Project gives pregnant women and women with children under the age of five money to buy food and teaches them about child nutrition. It has been able to reach more than 165,000 pregnant or lactating women and 175,000 children so far.
    • Conflict-affected communities in Mindanao are among the poorest in the Philippines, suffering from poor infrastructure and lack of basic services. The World Bank along with other partners have aimed to enhance access to services and economic opportunities and build social cohesion. These projects have help build water systems, community centers, sanitation facilities, access roads, post-harvest facilities, and farming and fishing equipment, benefiting 650,000 people in 284 villages in a decade.
    • An innovative series of rapid survey methodologies were pioneered in Somalia, one of the poorest countries in Sub-Saharan Africa. The surveys overcame significant security and implementation obstacles to yield the most comprehensive analysis of the welfare of the Somali people in decades and is now being used in other countries. 

    Last Updated: Oct 07, 2020

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