Resource-rich African countries are less likely fend off poverty
While economic development in Sub-Saharan Africa is improving, it is still insufficient to significantly reduce poverty levels in the area.
Economic growth in Sub-Saharan Africa is projected to reach 3.5% in 2025 and 4.3% during 2026-27.
Per capita income growth in the region, anticipated to accelerate to 1.8% by 2027.
Poverty levels measured at $2.15 per day are expected to rise to 43.9% in 2025.
Despite predictions of 3.5% growth in 2025, and 4.3% in 2026-27, this rate falls short of the substantial expansion required to make a significant impact on poverty reduction.
The Africa Pulse report by the World Bank made this known, stating, 'The economic growth forecast of Sub-Saharan Africa by 2025-2027 will not be sufficient to reduce extreme poverty significantly, and meet people's expectations.'
'Although income per capita for the region as a whole is expected to accelerate to 1.1% in 2025, and firm up at 1.8% in 2026-27, it would be insufficient to reduce poverty significantly,' the report adds.
According to the World Bank, in Sub-Saharan Africa, a 1% rise in per capita GDP leads to just a 1% reduction in severe poverty.
This is far lower than the worldwide norm, when a comparable GDP gain generally results in a 2.5% reduction in poverty levels.
This difference suggests that the region's economic progress does not successfully convert into improved living conditions for the majority.
'The pace of economic expansion in the region remains below the growth rate of the previous decade (2000-2014) and is insufficient to have a significant effect on poverty reduction,' the global lender revealed.
Additionally, structural inequities, such as those in access to education, healthcare, and financial services, impede the equitable distribution of economic benefits.
This, unfortunately, denotes that the poverty rate in the region is expected to go up till 2027.
'Forecasts for 2025-27 indicate that the poverty rate measured at the $2.15 per capita per day international line in 2017 purchasing power parity will continue to rise to 43.9% in 2025 before dropping to 43.2% in 2027.'
The report highlights that this extreme poverty rate is concentrated in a few countries in SSA, however, it points out a strange phenomenon in which countries expected to curb poverty are more at risk.
'Non-resource-rich countries are expected to continue reducing poverty faster than resource-rich countries. Thanks to prices of agricultural commodities, non-resource-rich countries will see higher growth overall despite fiscal pressures,' the report reads.
'Conversely, resource-rich countries are expected to grow at the same rate given decelerating oil prices,' it adds.
The World Bank goes on to suggest that to effectively eradicate poverty, Sub-Saharan Africa must prioritize inclusive growth measures that address structural disparities.
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