Study Demonstrates that COVID-19 May Increase Global Poverty
Based on a study published last week by the United Nations University World Institute for Development Economic Research, COVID-19 may increase global poverty by more than half a billion people worldwide. This would be the first time in 30 years for this to happen.
The study analyzed global poverty levels using three scenarios, including low (5 percent), medium (10 percent) and high (20 percent) short-term declines in per capita income or consumption, depending on country data. At the lowest level, there could still be approximately 85 to 135 million people below the poverty line. At the highest level, there could be 419 million people living in extreme poverty.
Although Sub-Saharan Africa has not seen as many COVID-19 cases and deaths as the United States and Europe, the region has already been affected economically. The World Bank and International Monetary Fund (IMF) are projecting that the region will be impacted by a recession for the first time in 25 years. Concerning issues regarding COVID-19 include enforcing lockdowns and social distancing. Workers who earn a $1.90 daily wage are required to work for survival and the policies would cause great economic distress.
Combatting this problem will depend on a partnership between development agencies, national governments, civil society and the private sector. Oxfam International is asking world leaders to implement an Economic Rescue Plan for All to raise $2.5 trillion dollars. This money would be used to support developing countries and prevent economic collapse. This week, the G7 finance ministers and central bank governors announced they would suspend approximately $20 billion in debt for some of the world’s poorest countries
Read more at UN Dispatch.