BREAKING: Extreme Poverty Rising Fast In Nigeria, Others (World Bank)

The conflict and instability in the 39 economies, including Nigeria, categorized by the World Bank as Fragile and Conflict-Affected Situation (FCS) countries, is exacting a devastating toll on them, “driving up extreme poverty faster than anywhere else, intensifying acute hunger, and pushing several key development goals farther out of reach”, according to a report released by the Bank yesterday.

The report stated that as conflicts have become more frequent and deadly in the 2020s, these economies are falling behind all other economies in key indicators of development.

Specifically, it said that since 2020, the per capita GDP of these countries has shrunk by an average of 1.8% per year, while it has expanded by 2.9% in other developing economies.

It also said that this year, 421 million people are struggling on less than $3 a day in economies afflicted by conflict or instability—more than in the rest of the world combined, adding that this number is projected to rise to 435 million, or nearly 60% of the world’s extreme poor, by 2030.

Commenting on the report, World Bank Group’s Chief Economist, Indermit Gill, said: “For the last three years, the world’s attention has been on the conflicts in Ukraine and the Middle East, and this focus has now intensified.

“Yet more than 70% of people suffering from conflict and instability are Africans. Untreated, these conditions become chronic. Half of the countries facing conflict or instability today have been in such conditions for 15 years or more. Misery on this scale is inevitably contagious.”

According to the World Bank, the report shows why the global goal of ending extreme poverty has been unattainable so far: “it is now concentrated in areas of the world where progress is hardest to achieve.”

The bank noted that of the 39 economies currently classified as facing conflict or instability, 21 are in active conflict.

It further said: “In developing economies in general, the extreme-poverty rate has been whittled down to single digits—just 6%. In economies facing conflict or instability, however, the rate is nearly 40%. Their GDP-per-capita levels, currently about $1,500 a year, have barely budged since 2010—even as GDP per capita has more than doubled to an average of $6,900 in other developing economies.

Moreover, unlike other developing economies, economies struggling with conflict or instability have been unable to create enough jobs on average to keep pace with population growth. In 2022, the latest year for which such data are available, more than 270 million people were of working age in these economies—but barely half of them were employed.”

Also commenting on the report, the World Bank Group’s Deputy Chief Economist and Director of the Prospects Group, Ayhan Kose, said: “Economic stagnation—rather than growth—has been the norm in economies hit by conflict and instability over the past decade and a half.

“The global community must pay greater attention to the plight of these economies. Jumpstarting growth and development here will not be easy, but it can be done—and it has been done before. With targeted policies and stronger international support, policy makers can prevent conflict, strengthen governance, accelerate growth, and create jobs.”

The Bank, however, noted that despite their challenges, these economies hold several potential advantages—which, with the right policies, could help reignite growth.

It said: “Profits from natural resources—minerals, forests, oil, gas, and coal—amount to more than 13% of their GDP on average. That is three times the share for other developing economies.

Several economies—especially the Democratic Republic of Congo, Mozambique, and Zimbabwe—are rich in minerals needed for renewable-energy technologies such as electric vehicles, wind turbines, and solar panels.

“A youthful, expanding population is a long-term advantage. In most advanced and developing economies, the working-age population has already begun to stabilize or shrink.

Not so in economies afflicted by conflict or instability, where the working-age population is expected to expand steadily for most of this period: by 2055, nearly two out of every three people will be of working age—a larger share than anywhere else in the world.

“Reaping a ‘demographic dividend,’ however will depend on ramping up investments in education, health, infrastructure, and building a vibrant private sector that can generate more and better jobs.”

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