Poverty Trends and Development Challenges

Sep 16, 2024

Poverty and Economic Development

Global Overview

  • Every 1.2 seconds, someone escapes extreme poverty.
  • Definition of extreme poverty: Living on less than $1.90 per day (World Bank).
  • Absolute poverty rates have decreased faster in the past 30 years than ever before.

Key Achievements

  • Significant reduction of poverty rates, largely driven by changes in China and India.
    • India: Extreme poverty rate dropped to 21%.
    • China: Extreme poverty rate dropped to less than 2%.

Factors Contributing to Poverty Reduction in Asia

  • Increased productivity in agriculture.
  • Mass urban migration from rural to urban areas.
  • Transition from rural agriculture to city-based factory jobs.

Challenges in Sub-Saharan Africa

  • Over half of the world's poorest people live in sub-Saharan Africa.
  • Poverty rate drop from 54% (1990) to 41% (2013), but total number of poor increased due to population growth.
    • 1990: 276 million poor people.
    • 2013: Almost 400 million poor people.
  • Population expected to reach 2 billion by 2050, with a large portion extremely poor.

Barriers to Poverty Reduction in Sub-Saharan Africa

  • Fast urbanization not leading to poverty reduction like in Asia.
  • Lack of infrastructure, public transport, and essential services in cities.
  • Rapid population growth strains resources limiting opportunities for jobs and education.
  • Many live far below the poverty line, complicating poverty alleviation efforts.

Conclusion

  • While Asia’s model of urban migration and industrialization has been successful, replicating this in sub-Saharan Africa presents significant challenges due to infrastructure and resource constraints.