Global extreme poverty is set to rise in 2020-the first time in two decades- as effects of Covid-19 disruption takes toll on the global economy that was already reeling from the combined force of conflict and climate change, a latest report by the World Bank (WB) suggests.
According to the report released yesterday, an additional 88 million new poor have emerged from the pandemic, mostly from already poverty-stricken countries such as Zimbabwe, and will push the total number of people living in extreme poverty to 150 million by next year.
Extreme poverty is defined as living on less than US$1.90 a day and according to the biennial Poverty and Shared Prosperity Report, it’s likely to affect between 9.1% and 9.4% of the world’s population in 2020.
“The pandemic and global recession may cause over 1.4 percent of the world’s population to fall into extreme poverty,” said World Bank Group President David Malpass.
“In order to reverse this serious setback to development progress and poverty reduction, countries will need to prepare for a different economy post-COVID, by allowing capital, labor, skills, and innovation to move into new businesses and sectors, he added.
The report also finds that many of the new poor will be in countries that already have high poverty rates such as Zimbabwe.
Already, the United Nations early this year indicated that more than 70 percent of Zimbabwean children in rural areas were living in poverty. This was before the Covid-19 pandemic hit the country.
“The convergence of the COVID-19 pandemic with the pressures of conflict and climate change will put the goal of ending poverty by 2030 beyond reach without swift, significant and substantial policy action,” the World Bank said.
Zimbabwe’s battered economy has already endured consecutive droughts in the past two seasons and political conflict which saw over US$ 100 million worth of valuables lost through looting and property destruction in the January 2019 protests.
“The current economic conditions points to rising poverty levels in the country. Remember Zimbabwe is not only battling with Covid-19 effects but had other underlying ailments such as low growth rate due to inflation, weak production, low investment and political contestation among other problems. So these problems remain very much alive and as long as they are unresolved life for the ordinary citizen will be unbearable,” economic analyst, Victor Bhoroma said.
While the full extent of the impact of Covid-19 on Zimbabwe is yet to be established, telltale signs already point to rising levels of poverty in the country.
Forced unpaid leave and retrenchments during the Covid-19 lockdown have seen a substantial number of livelihoods vulnerable to poverty.
Year on year Inflation has soared beyond 750 percent while incomes remained stagnant.
Workers from both the government and private sector are earning on average monthly wages of less than US$ 50.
The economy is expected to register negative growth of 10 percent meaning possibilities of new businesses and employment will be limited in an economy were unemployment rate of over 90 percent.