WASHINGTON, USA, December 4, 2024-/African Media Agency (AMA)/- According to a new World Bank report released yesterday, limited and unequal access to employment, financing and public services such as education and health care, has increased inequalities and hindered poverty reduction in sub-Saharan Africa.
The report, titled “ Starting on a level playing field: eliminating structural inequalities to accelerate poverty reduction in Africa »explains that structural inequalities, based on factors such as place of birth, ethnicity, gender and parental background, as well as market and institutional distortions that favor a minority over the majority .
As a result, Africa is today the second most unequal region in the world after Latin America, and the only one where the reduction of extreme poverty has stagnated in recent years. While extreme poverty – defined as surviving on less than $2.15 per person per day – has declined rapidly globally, falling below 10%, the rate of extreme poverty in Africa remains the highest of all regions, rising to 38% in 2022. Currently, 60% of the world’s population living in extreme poverty is in sub-Saharan Africa, a proportion that could rise to 87%. by 2030, in the absence of significant reforms.
The report calls for poverty reduction strategies focused on developing equitable opportunities. Since the early 2000s, for example, Ethiopia has expanded land use rights, helping to promote investment in agriculture. In Kenya, market-friendly financial products such as mobile money have helped strengthen financial inclusion and household resilience to shocks. In Ghana, investments in primary education have helped increase school completion rates, while partial liberalization of the cocoa market combined with investments in research, disease control and credit programs, led to an increase in agricultural income.
« There is nothing inevitable about structural inequalities. As country success stories show, barriers to opportunity can be removed through well-designed policies that enable everyone to strengthen their productive capacities and access jobs and markets. “, underlines Nistha Sinha, co-author of the report.
Overall, the region struggles to transform economic growth into poverty reduction, due to high inequality. The report highlights that many people are born into circumstances that significantly limit their prospects. Thus, children born among the poorest 20% of the population are the least likely to finish school on time. On average, only 32% of poor households have access to electricity, compared to nearly 70% of non-poor households. These differences are compounded by market and institutional distortions that inhibit the productive potential of individuals, perpetuating cycles of poverty, and forcing disadvantaged young people to accept precarious, low-paid jobs in the informal sector.
The report identifies four priority areas to tackle structural inequalities:
1. Strengthen economic and institutional foundations in order to eliminate barriers to competition and protect property rights.
2. Invest in education, health and infrastructure to strengthen productive capacities.
3. Facilitate job creation through markets by improving access to capital, technologies and markets.
4. Ensure equitable use of public resources through progressive taxation and efficient public spending.
« These priorities must be addressed in an integrated manner, as they are mutually reinforcing: Together, they both create a level playing field and develop the region’s productive capacity “, explain Gabriela Inchauste, co-author of the report.
By tackling structural inequalities, sub-Saharan Africa not only has the potential to foster inclusive growth, but also to reduce poverty and create new opportunities for millions of people.
In Washington:
Caitlin Berczik, + 1 (202) 458-9351, [email protected]
Daniella Van Leggelo Padilla, + 1 (202) 751-8156, [email protected]
Distributed by African Media Agency (AMA) for the World Bank.
Source : African Media Agency (AMA)
2024-12-04 09:20:00
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What are the four key areas the World Bank believes need to be addressed to reduce poverty in Sub-Saharan Africa?
## Interview with World Bank Expert on Poverty Reduction in Sub-Saharan Africa
**Host:** We’re joined today by Alex Reed, a leading expert on poverty reduction at the World Bank. The World Bank recently released a report highlighting the challenges of reducing poverty in Sub-Saharan Africa. Alex Reed, can you give us a brief overview of the report’s key findings?
**Alex Reed:** The report, “Starting on a Level Playing Field,” paints a stark picture of the challenge facing Sub-Saharan Africa. While global poverty has drastically reduced, it remains stubbornly high in the region, at 38% in 2022. This is due in large part to structural inequalities based on factors like birthplace, ethnicity, and gender, which limit opportunities for millions.
**Host:** That’s striking. The report mentions several success stories, though. Can you give us some examples of how Sub-Saharan African countries are addressing these inequalities?
**Alex Reed:** Absolutely. Ethiopia has seen success by expanding land use rights, boosting investment in agriculture. Kenya’s mobile money initiatives have improved financial inclusion and household resilience. In Ghana, investments in primary education have led to higher school completion rates.
**Host:** Those are encouraging examples. What does the report say needs to be done moving forward?
**Alex Reed:** We need a focus on four key areas: strengthening economic and institutional foundations, investing in education, health, and infrastructure, facilitating job creation through markets, and ensuring equitable use of public resources. These are interconnected and must be addressed together to truly create a level playing field and unlock the region’s productive capacity.
**Host:** What’s the impact if these inequalities aren’t addressed?
**Alex Reed:** Without significant reforms, the proportion of the world’s poor living in Sub-Saharan Africa could soar to 87% by 2030. This would have devastating consequences for the lives of millions and hinder the region’s progress towards sustainable development.
**Host:** This is a crucial moment for Sub-Saharan Africa. Thank you Alex Reed for providing your insights.
**[End Interview]**
