The World Bank Group has said that the estimated per capita income growth of 0.7 per cent for Nigeria and the rest of Sub-Saharan Africa in 2022 is insufficient to meet the challenging goals of poverty reduction and shared prosperity in the medium to long term.
In its new report titled “Africa’s Pulse: An analysis of issues shaping Africa’s economic future,” the Washington-based bank said that poverty reduction trends, which were already derailed by the pandemic, had slowed further.
According to the report, the pandemic has induced a lasting impact on long-term growth, affecting particularly the poorest people and increasing extreme poverty.
It added that the weak rebound of the Nigerian economy in the aftermath of the pandemic along with the setback from rising inflation was insufficient to undo pandemic-induced job and income losses.
The report partly read, “Rising inflation is weighing on economic activity in Sub-Sahara. The upward trend in inflation following the post-pandemic period was exacerbated by the war in Ukraine, soaring to record highs in many countries.
The escalation of the war has fueled a rise in commodity prices, particularly food and energy prices. High pass-through of food and fuel prices to consumer prices has caused headline inflation to spike.”
The World Bank also said rising inflation is weighing on economic activity in Nigeria, and that the upward trend in inflation following the post-pandemic period was exacerbated by the war in Ukraine.
The report read further, “The escalation of the war has fueled a rise in commodity prices, particularly food and energy prices. High pass-through of food and fuel prices to consumer prices has caused headline inflation to spike.
The fiscal space to mount effective responses today is gone because of high levels of debt across Sub-Saharan African countries, rising borrowing costs, and depleted public savings.”
The report follows an earlier publication by the Bank titled “A Better Future for All Nigerians: Nigeria Poverty Assessment 2022,” in which it noted that deep structural reforms guided by evidence are urgently needed to lift millions of Nigerians out of poverty.
It added that sluggish growth, low human capital, labor market weaknesses, and exposure to shocks are holding Nigeria’s poverty reduction back.
According to the report, which brings together the latest evidence on the profile and drivers of poverty in Nigeria, as many as four in 10 Nigerians live below the national poverty line.
In its recent review of Nigeria’s poverty map, the National Bureau of Statistics pegged 62.9 per cent of Nigerians — nearly 133 million people — as multidimensional poor. The figure represents a significant jump from the World Bank’s projection earlier this year, which placed 95m Nigerians under the poverty line.