World Bank Says Pandemic Could Push 60 Million People into Extreme Poverty

On May 19, the World Bank says that the coronavirus pandemic could force around 60 million people into earning $2 a day, which is considered as extreme poverty.

Financial crisis

The World Bank warned countries as pessimism among economists deepened about the duration and scale of the unprecedented crisis. The World Bank provides loans and grants to poorer countries to help them during the pandemic, and last month the bank predicted that the coronavirus pandemic could cause the first increase in global poverty since 1998.

On April 20, a blog post estimates that 49 million people would be living in around $2 per day, in which economists define as having to live in extreme poverty. This is due to the coronavirus outbreak shutting down almost all economic activities and all of the progress that was made to elevate poverty figures have been erased.

The president of the World Bank, David Malpass, said in a statement that the sudden increase in cases in some countries forced the bank to send their largest and fastest crisis response. The bank's emergency relief efforts had already been deployed to 100 countries, which equates to 70% of the world's population.

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The World Bank aims to assist the most vulnerable communities by giving loans and grants to businesses and individuals, as well as suspending all of the debt payments for some third world countries. Overall, the bank has pledged $160 billion to combat the coronavirus.

The world's poorest people are feeling the effect

Migrant workers around the world have been laid off as the pandemic forced numerous industries to seize their operations. Because of this, the World Bank estimates that global remittances, or the money that migrant workers sent to their families, could drop by 20% this year, which is equivalent to $100 billion.

On May 20, human rights chiefs warned that millions of people in Africa may live without the basic necessities as a result of the pandemic.

The UN High Commissioner for Human Rights Michelle Bachelet and Chairperson of the African Commission on Human and Peoples' Rights Solomon Dersso said in a joint statement that they can't afford to stand idly by and just hope that the coronavirus pandemic will bypass Africa, as it is home to millions of the world's poorest countries who are not in the position to handle the pandemic.

Last month, the World Bank said that it expected people who live in sub-Saharan Africa would suffer the most during this crisis. Around 39 of the World Bank's 100 target countries are there and around 23 million residents of sub-Saharan Africa are predicted to be heading to extreme poverty.

Aside from Africa, South Asia is also predicted to suffer. The World Bank economists said that Nigeria, the Democratic Republic of Congo, and India were all estimated to have the largest change in the number of poor people, with about 12 million people affected.

The analysts at the World Bank wrote that the places where the coronavirus is taking its toll depend on two factors, one is the impact of the virus on the country's economic activity and the second is the number of people who are living close to the poverty line.