A few days ago, the World Bank published a Policy Research Note titled “Ending Extreme Poverty and Sharing Prosperity: Progress and Policies”. The key developments presented in the report include:
- The international poverty line has been changed from $1.25 per day to $1.90 per day, based on 2011 Purchasing Power Parity (PPP) values. Why this had to be done? $1.25 per day poverty line is based on prices of commodities in different countries in 2005. Now we have data on prices in 2011. Obviously, prices have increased from 2005 to 2011. This asked for a corresponding rise in poverty line too.
- The number of poor in the world has come down from ~900 million in 2011 to ~700 million in 2015. During the same period, global poverty rate has reduced from 14.2% to 9.6%. Though this is good news, one should keep in mind that running the last mile is always difficult; the remaining poor may face the toughest barriers to escape poverty.
- Between 1990 and 2015, Sub-Saharan Africa’s share of the world’s poor has increased from ~15% to ~40% while the share of South Asia has remained almost the same, at ~30%. East Asia and the Pacific has produced the largest decline, from ~50% to ~15%.
- Prosperity is not shared adequately with the bottom 40% of the income distribution in high-income countries.
- Presently, the key challenges that stand out are (1) the depth of remaining poverty, (2) the unevenness in shared prosperity, and (3) the unequal progress in non-income dimensions of development.
Click here to download the report.
Click here for a post on the World Bank blog “Let’s Talk Development” which has a more detailed explanation about the change in poverty line and associated numbers.
Please note that all the above figures and the screenshot have been taken from the report. All rights belong to the World Bank Group.