The number of people living in extreme poverty by 2022 is expected to be between 657 million and 676 million. This means that the Govt-19 crisis, rising inflationary pressures and the conflict in Ukraine will push 75 million to 95 million people into poverty, more than estimated by pre-epidemic forecasts.
People living in extreme poverty have gone through two unusually difficult years. Due to the COVID-19 epidemic, poverty reduction has seen an unprecedented recession, coupled with rising inflation and war in Ukraine.
World Bank researchers estimate that these integrated crises will increase the number of people living in extreme poverty from 75 million to 95 million by 2022. There has been little progress since 2020, which has even seen an increase in global poverty.
How do they achieve these ratings? They assume that the real income of all households has risen with the per capita GDP of each country. For all countries, they calculate the increase in household income from 2019 to 2020 based on the growth rate of effective per capita GDP by 2020. They do the same based on forecasts of an increase in per capita GDP as shown in 2021 and 2022. Le Macro Poverty Overview From April 2022.
To analyze the evolution of poverty from the onset of the epidemic and to predict the future, they use development hypotheses established before the Govt crisis as a hypothesis. The difference between this adverse situation and current forecasts reflects the effects of the epidemic (mainly for 2020) and includes other factors such as recovery (stronger than expected in some countries), inflationary pressures and the conflict in Ukraine (by 2022). More specifically).
Their reference calculations assume that all households in a country are equally affected by inflation. However, they do know that data from 80% of the countries they own recorded higher food inflation in February than in any other country.
They also know that the most humble families generally devote a greater share of their resources to food than to other purchases. In other words, they may be more severely affected by current inflationary pressures than their benchmark calculations allow.
“As a result, our estimates may not adequately reflect the effects of the current crisis on global poverty. Unfortunately, we do not yet have the data on inflation or the results of household surveys needed to establish the extent to which each household feels the effects of rising prices,” the researchers explain.
One of the ways to calculate the random impact of high inflation on food prices is to calculate the difference between the inflation shock experienced above and below the income distribution, while keeping the inflation rate unchanged. “ In terms of the most unequal effects emanating from a Simulation Rising food prices in 53 countries , We have designed a globally “pessimistic” scenario.
Under this scenario, the poorest 40% of people in each country experience average inflation, which is 3% higher than the inflation carried by 60% of the rich. In 36 countries of sub-Saharan Africa, this is equivalent to more than twice the cost of food, ”they added.
According to two scenarios, the number of people living in extreme poverty by 2022 is expected to be between 657 million and 676 million. Analysts predict that by 2022, 581 million people living below the poverty line will be outnumbered. This means that the Govt-19 crisis, rising inflationary pressures and the conflict in Ukraine will push 75 million to 95 million people into poverty, more than estimated by pre-epidemic forecasts.
“Coffee trailblazer. Social media fanatic. Tv enthusiast. Friendly entrepreneur. Amateur zombie nerd.”