Global Poverty Figures Revised Upward

by Haider Rizvi

NEW YORK - A new study released by the World Bank this week has raised concerns among humanitarian workers worldwide as more people are now believed to be living in impoverished conditions than previously thought.

Despite significant levels of economic achievements made in the past 25 years, well over 1 billion people in the developing world remain as poor as ever, according to the study entitled: "The developing world is poorer than we thought but no less successful in the fight against poverty."

Revisions of estimates of poverty since 1981 revealed that 1.4 billion people (one in four) in the developing world were living on less than $1.25 a day in 2005, down from 1.9 billion (one in two) in 1981, said the study's authors Martin Ravallion and Shaohua Chen.

Until now, poverty estimates were based on the (then) best available cost of living data from 1993. The old data indicated that about 985 million people were living below the former international $1-a-day poverty line in 2004, and about 1.5 billion had been living below that line in 1981.

The new estimates continue to assess world poverty by the standards of the poorest countries. The new line of $1.25 for 2005, according to Ravallion and Chen, is the average national poverty line for the poorest 10-20 countries.

"The new estimates are a major advance in poverty measurement because they are based on far better price data for assuring that the poverty lines are comparable across countries," said Ravallion, director of development research at the Bank.

The study's release led to a flurry of calls for increased global actions to fight poverty from some of the world's leading international aid organization and anti-poverty groups.

"This is a pretty grim analysis coming from the World Bank," said Elizabeth Stuart, senior policy advisor at Oxfam International. "Although the overall number of people living under the poverty line has come down, you still have a quarter of the developing world living on less than $2 a day."

Stuart also voiced concern about the negative impact of the recent increase in food prices on worldwide efforts to fight poverty, which, she thinks, will leave half a billion more people living in miserable conditions.

"The urgency to act has never been greater; the clock is ticking," she said, "especially in sub-Saharan Africa where half the population of the continent lives in extreme poverty, a figure that hasn't changed for over 25 years."

According to ActionAid, an independent group fighting against poverty worldwide, much of the sub-Saharan region is now "reaching a tipping point" with increasing numbers of people unable to cope as food prices rise. Its analysts say Ethiopia, Kenya, Somalia, Eritrea, and Djibouti remain extremely affected by poverty.

"If nothing is done, the situation could easily become catastrophic," the group warned in a statement. In Ethiopia, the government estimates that 4.6 million people need emergency food aid. Less documented is the disastrous food crisis in Kenya, with 1.2 million people already affected and numbers rising daily.

In their reflections on the study's results, the World Bank officials and researchers seemed optimistic about the possibility of bringing down the numbers of people living in extreme poverty by the year 2015.

"The new data confirm that the world will likely reach the first Millennium Development Goal of halving the 1990 level of poverty by 2015 and that poverty has fallen by about one percentage point a year since 1981," said Justin Lin, chief economist at the Bank.

"However," he added in a statement, "the sobering news that poverty is more pervasive than we thought means we must redouble our efforts, especially in Sub-Saharan Africa."

The new data show that marked regional differences in progress against poverty persist. Poverty in East Asia has fallen from nearly 80 percent of the population living below $1.25 a day in 1981 to just 18 percent in 2005.

However, the study also shows that the poverty rate in Sub-Saharan Africa remains at 50 percent in 2005 -- no lower than in 1981, although with more encouraging recent signs of progress.

Driven by concerns over the persistent extent of poverty worldwide, groups like Oxfam and ActionAid are trying to turn up the heat on the international community to take immediate and urgent steps to achieve the Millennium Development Goals.

"All eyes will now turn to the special UN event looking at the global poverty goals in New York next month," said Oxfam's Stuart. "Heads of state, business leaders, and others will need to do more than to deliver fine speeches and re-commit to act on tackling poverty.

"A clear plan of action is needed on how we will lift hundreds of millions out of extreme poverty," she added in a statement.