Many of the world’s poorest countries need a significant change in their poverty reduction trajectory to see an end to extreme poverty by 2030 according to the report Investments to End Poverty published today by the international development organisation, Development Initiatives.
While huge progress has been made globally, in 30 countries the number of people living in extreme poverty increased during the period of the Millennium Development Goals. The 18 countries showing the most rapid increase in poverty in the last decade are in sub-Saharan Africa where poverty is also deepest globally. To end poverty by 2030, countries in sub-Saharan Africa will need to reduce poverty at a pace faster than South Asia has achieved in the last 15 years.
The report also shows that national trends can mask big differences within countries – even those that are making good progress nationally. Available data indicates that while India reduced poverty by 10 per cent a year over the last 15 years in 10 states, eight smaller states actually saw poverty increase.
Harpinder Collacott, Executive Director at Development Initiatives, said “Halving poverty has been an incredible achievement, however there are many people who have been left behind. The new Sustainable Development Goals are going to be hugely important for driving forward an even more ambitious agenda specifically focused on leaving no one behind over the next 15 years.
“Extreme poverty is increasingly concentrated in complex and challenging contexts, and efforts will need to be intensified and better focused if poverty targets are to be met. Our research shows that the proportion of people living in extreme poverty in fragile states has risen from around 20 per cent in 1990 to 62 per cent in 2015. Today, 96 per cent of people living in poverty are in countries that are politically fragile, environmentally vulnerable, or both. Addressing fragility, conflict and crisis will be essential in the fight against poverty.”
The report analyses the mix of international and domestic resources that could play a role in poverty reduction. It shows that, particularly where poverty is deepest, governments do not have the volumes of revenue needed to implement the Sustainable Development Goals, and that aid has an important contribution to make in reducing poverty, creating stability and reducing vulnerability to shocks. There needs to be much greater visibility across the mix of resources and crucially better targeting of aid to where the poorest people are. This is critical to ensuring we get on track to meet the first Sustainable Development Goal and specifically the target of ending extreme poverty by 2030.
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Contact: Anna Abuhelal, Communications Manager at Development Initiatives
E: Anna.Abuhelal@devinit.org T: +44(0)1179 272505 M: +44(0) 7894442055
Notes to editors:
- A range of data graphics for the key findings are available.
- Harpinder Collacott, Executive Director at Development Initiatives, and Tim Strawson, Programme Lead on Investments to End Poverty, are available for comment or interview.
- ‘Depth of poverty’ measures the scale of the challenge that each country faces to end poverty. It is based on an official UN MDG indicator, the poverty gap ratio, and measures the average gap in incomes for people living below the poverty line, spread across the population. It is expressed as a percentage of the $1.25 a day poverty line, where a higher percentage means greater depth of poverty and a more significant challenge to ending poverty. Poverty data can be used to tell us numbers of people living below the $1.25 threshold and also, at a national level, how far below the line people are.’
Key findings include
- Governments in many developing countries raise low volumes of revenue that are not enough to implement the Sustainable Development Goals at the national level. In 24 of the 33 countries where depth of poverty is highest globally, government revenues are less than $1.37 per person a day (adjusted for purchasing power parity, PPP) compared with PPP$34 a day in high income countries.
- Low government revenues mean that, although sub-Saharan Africa spends the second highest proportion of revenues on health among all regions, spending per person is the second lowest among them.
- Where depth of poverty is greatest, countries are more reliant on indirect taxes. Without careful design this can place a greater burden of tax on the poorest people.
- Where poverty is greatest, revenue is projected to have the slowest growth
- The comparative advantage of aid is that it can be targeted more directly at the investments needed to reduce poverty than other resources.
- There is significant room to improve the targeting of aid. 29 per cent of official development assistance (ODA) goes to countries with a depth of poverty of less than 1 per cent, and in 2013 only 9 per cent of ODA commitments to build resilience against environmental shocks went to the most vulnerable countries.
- Donor agencies with a stronger mandate for targeting poverty allocate their resources more effectively: over 90% of ODA from agencies with a legal mandate to target poverty go to countries with the lowest government revenues (less than PPP$1,000 per person), compared with 50% from agencies that do not have a specific objective for targeting poverty.
- The data that guides efforts to end poverty is not fit for the purpose of ending poverty: just 12 of 55 African countries have comprehensive birth registration and a quarter have not conducted a poverty survey since 2008.