Going Above And Beyond To End Poverty: New Ways Of Measuring Poverty Shed New Light On The Challenges Ahead

The fight to end extreme poverty is revealing a developing dichotomy. On the one hand, extreme poverty continues to be stubborn in certain parts of the world, while in others it has become minuscule or non-existent. In about half of the world’s countries, less than 3 percent of the population is living on less than $1.90 a day—but that doesn’t mean the fight to eradicate poverty is over in these countries. 

Recognizing this divergence, a new World Bank report—Poverty and Shared Prosperity 2018: Piecing Together the Poverty Puzzle—broadens our understanding of poverty. It introduces new tools and measures that will help countries better identify the poor and implement appropriate policies to build human capital and improve living standards.

Between 1990 and 2015, more than a billion people moved out of extreme poverty, and the global poverty rate is now lower than it has ever been in recorded history. In 1990, almost 36 percent of the global population lived on less than $1.90 a day, but by 2015 this number had dropped to a new low of 10 percent. Preliminary forecasts for 2018 show that global extreme poverty has further declined to 8.6 percent, besting the 9 percent interim target set for 2020 by two years.

Much of this decline is due to impressive growth in Asia, particularly China and India. As global poverty continues to fall, however, troubling signs are emerging as the pace of reduction is slowing. If this trend continues, it could threaten the goal of ending extreme poverty by 2030.

That’s because poverty is becoming more entrenched in certain pockets around the world, particularly in Sub-Saharan Africa and conflict-affected countries. The total number of poor in Sub-Saharan Africa has been increasing. In 2015, more extreme poor lived in that region than in the rest of the world combined. By 2030, forecasts predict that nearly 9 out of 10 extremely poor people will live in Sub-Saharan Africa and poverty there will remain in the double digits.