Forecasts from World Bank project first global poverty increase since 1998
As the novel coronavirus sprawls across the globe, wreaking havoc on human lives and economic health, the World Bank on Monday predicted that 2020 would see the first increase in global poverty in more than two decades.
Economists at the international financial institution calculate that the pandemic will push 40 million to 60 million people into extreme poverty, with its “best estimate being 49 million,” according to a post on the bank's Data Blog.
The projected increase in global poverty would be the first since 1998, when the Asian financial crisis hit.
Global poverty — defined as the percentage of the world’s population living on less than $1.90 a day — is predicted to increase from 8.2 percent in 2019 to 8.6 percent in 2020, a jump from 632 million people to 665 million people. Previous numbers projected a decline from 8.1 percent to 7.8 percent for the year.
“In the more pessimistic scenarios, global poverty in 2020 would be close to the level of 2017 — meaning that world’s progress in eliminating extreme poverty would be set back by three years,” the post's authors said. The increase in global poverty would have the greatest impact on developing and low- to middle-income countries, with sub-Saharan Africa taking the greatest hit.
The virus has spread across the globe, leaving more than 2 million people dead, more than 150,000 infected, and leaving countries in economic despair. In the U.S. alone, more than 22 million Americans have already filed jobless claims.
Last week, the International Monetary Fund projected that the crisis would result in the worst recession since the Great Depression. The fund also predicted that income per capita would shrink across 170 countries in 2020, but its managing director, Kristalina Georgieva, on Friday said the projection might be “a more optimistic picture than reality produces.”
“Epidemiologists are now helping us make macroeconomic projections,” Georgieva told the BBC in an interview. “Never in the history of the IMF have we had that. And what they’re telling us is that the novel coronavirus is a big unknown, and we don’t know whether it may return in 2021."