di: Céline Dominique Nadler | April 18, 2024
Half of the world‘s 75 poorest countries are experiencing a widening income gap with richer economies for the first time this century, in a historic reversal of development. This is what the World Bank stated in a report.
According to the report, the gap between per capita income growth in poorer and richer countries has widened over the past five years. “For the first time we see that there is no convergence. They are getting poorer and poorer,” Ayhan Kose, deputy chief economist at the World Bank and one of the report’s authors, told Reuters. “We are seeing a very serious structural regression, a reversal of trends in the world… that’s why we are ringing the alarm bells,” he said.
The report says the 75 countries eligible for grants and zero-interest loans from the World Bank’s International Development Association (IDA) risk losing a decade of development without ambitious policy changes – including domestic efforts to strengthen fiscal, monetary and financial policies and structural reforms to improve education and increase national revenues – and significant international aid.
Among the major factors involved, according to World Bank experts, are the Covid-19 pandemic, the invasion of Ukraine by Russia, climate change, the increase in violence and conflicts.
More than half of all countries supported by IDA are located in sub-Saharan Africa; 14 are in East Asia and eight are in Latin America and the Caribbean. Thirty-one have a per capita income of less than $1,315 per year, including the Democratic Republic of Congo.
One in three Ida countries is poorer today than on the eve of the pandemic. Ida countries represent 92% of people in the world who do not have access to sufficient nutritious and affordable food. Half of those countries are in debt distress, meaning they are unable to service their debt or are at high risk of not being able to.
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