Statistics on Poverty in Africa

CONTENT

1. Absolute numbers 2. Relative numbers 3. Alternative numbers 3. International vs national numbers

1. ABSOLUTE NUMBERS

According to the World Bank poverty estimates, Africa hasn’t seen much progress in terms of the absolute numbers of poor people. Compared to China, for instance, the number of poor people has grown steadily in Africa:

(source)

The numbers almost doubled from 200 million in 1981 to 400 million in 2005, although in 2008 it fell by 12 million (source).

2. RELATIVE NUMBERS

However, a lot of the growth in the absolute numbers is due to population growth. If you look at the relative numbers, the percentage of poor Africans has actually been falling during the last decade. Less than half the population is now extremely poor:

(source)

(source)

3. ALTERNATIVE NUMBERS

This paper tells the same story but with an alternative and even more optimistic set of numbers. In the graph below, the rate of the population surviving on less than $1 dollar day has fallen to 32% in 2006 from a high point of 45% in the late 1980s. How come? As you can also see in the graph, at the time poverty began to decline around 1995, GDP began to grow (after three decades of zero or negative growth). The graph shows a striking correlationbetween poverty reduction and economic growth (something I have written about before in another context, see here and here).

(source)

Of course, poverty reduction isn’t the automatic result of GDP growth only. Other factors are at work as well. What’s interesting is that this African growth spurt since 1995 (probably briefly interrupted by the current recession) isn’t just caused by growing oil prices. If that had been the case, we would have seen increasing income inequality, since revenues from the oil industry are typically appropriated by elites. But that’s not the case. Poverty reduction in Africa has gone hand in hand with a reduction in income inequality. You can see the extent of this reduction in the following two graphs:

(source)

This means that growth has benefited the poor. It’s a development that is remarkably general across African countries and that is not just explained by good news in a few large countries. Poverty is falling even in countries which are believed to burdened by geography, bad agricultural prospects, a history of slave trade, war, or lack of natural resources.

4. INTERNATIONAL VS NATIONAL NUMBERS

Notice the often large discrepancies between the World Bank poverty estimates and the different national estimates using a national poverty line:

(source)

Credit for the content of this page goes to  Filip Spagnoli. See HERE