1 week Ago By Punch Editorial Board
The new report by the World Bank has revealed that the United Nations Sustainable Development Goal of ending world poverty by 2030 will be unrealistic. According to the global lender in the report titled, “Poverty, Prosperity, and Planet Report”, “poverty remained concentrated in countries with historically low economic growth and high levels of fragility, many of which are in sub-Saharan Africa.” It explained that it could take three decades or more to eliminate poverty at this threshold, which is prevalent primarily among low-income countries.
Almost 700 million people – 8.5 per cent of the global population – live today on less than $2.15 per day, with 7.
3 per cent of the population projected to be living in extreme poverty in 2030. While it is no longer feasible to end extreme poverty by 2030, the report noted that it would take even longer – more than a century – to meet a more ambitious objective of raising incomes above the $6.85 a day deemed to be the poverty threshold for upper middle-income countries.
Today, 44 per cent of the world’s population lives on less than $6.85 per day, the poverty line for upper-middle-income countries. The number of people living under this poverty line has barely changed since 1990 due to population growth.
The bank defined upper-middle-income economies as those with income a head of between $4,466 and $13,845 a year in a group of countries that include Argentina, Botswana and China. Currently, 3.5 billion people – almost half the world’s population – live on less than $6.
85 a day and the report noted that population growth meant the number of poor people on this measure of poverty had barely changed since 1990. The report stated that there had also been little progress on another development goal – to reduce inequality. While the number of countries with especially large gaps between rich and poor had declined from 66 to 49 over the past decade, the percentage of people living in countries with high levels of inequality had remained unchanged at 22 per cent.
These countries were concentrated in Latin America, the Caribbean and sub-Saharan Africa. In Nigeria, more citizens have continued to fall below the poverty line following the ill-timed removal of subsidy on Premium Motor Spirit which led to a hike in cost of living. Headline inflation decelerated to 32.
14 per cent in August from 33.4 per cent in July, the second consecutive monthly decline after 19 months of persistent increases, per the National Bureau of Statistics. Poverty has become more entrenched with 40.
7 per cent of Nigerians expected to live below the poverty line by year-end per World Bank. Sustained pressure on the naira which has seen the currency trading at an average of N1,700 per dollar compared with N460 in May 2023 and interest rates hiked to 26.75 per cent from 11 per cent in two years have compounded the woes of manufacturers.
Inflation has been driven by high energy costs due to the petrol subsidy regime and the floating of the exchange rate – two policies implemented by the Bola Tinubu administration that have been touted as painful but necessary measures to prevent economic disaster. Insecurity, featuring the Boko Haram insurgency in the North-East, banditry in the North-West and killer herdsmen rapine in the North-Central and the South, has sent millions into internally displaced person camps strewn across the land and displaced farmers from their farmland. Consequently, food insecurity reigns.
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The worst hit are the rural areas where 53 per cent of the inhabitants are dirt poor. The poverty mess leaves Nigeria with a huge mountain to climb and the time to begin defeating poverty is now. There is hunger in the land and unprecedented hardship caused by decades of maladministration, poor economic management, incompetence, and corruption.
Lately, some misapplied policies of the government have worsened the situation. Externally, the effects of the COVID-19 pandemic and the Russia-Ukraine War have also taken their toll on the country and its over 200 million people. But the blame for the rampant poverty in Nigeria falls squarely on its successive leadership – executive and legislative, and national and sub-national.
People living in extreme poverty, many of whom work in the informal economy – unregistered, unrecognised, and unprotected under labour legislation- face difficult and dangerous conditions. Despite working long hours, they are unable to earn enough to support themselves and their families. Nigeria’s poverty is self-inflicted.
Abundant in natural and human resources, its successive Federal Governments have been inefficient, corrupt, and failed to drive the economy productively. Its sub-national governments are worse; indolent, wasteful, unproductive, and very corrupt. They revel in the perverse system of sharing crude oil revenue from a central pot instead of running productive, self-sufficient economies.
To reduce poverty, the central and state governments must devise effective policies to harness the country’s resources to create jobs and wealth. The 1999 Constitution that inhibits the states and creates an overbearing centre needs to be amended to unleash the states’ huge potential. The billions of naira being wasted on corruption-fuelled cash transfers should be channelled to MSMEs, agriculture, emergency work and youth entrepreneurial support programmes.
In his first presidency in 2003-2010, Ignacio Lula DaSilva’s cash-grant programme, Bolsa Familia, was accompanied by aid to small farmers, and labour and pension reforms that together reduced extreme poverty in Brazil from 12 per cent to 4.8 per cent and lifted 20 million persons out of poverty. Reviving the economy requires stimulus spending, an enabling environment for domestic and foreign investment inflow, and effective security through devolved law enforcement, adequate power supply, and massive support for agriculture, rural infrastructure, mining, start-ups and MSMEs.
Tinubu should launch a strategic programme against insecurity because conflict is a major fuel of poverty. If farmers return to their farms, there is hope that poverty will recede, thereby creating jobs. The regime should implement radical economic policies by privatising the refineries, Ajaokuta Steel Complex, seaports, airports, and other state-owned enterprises transparently.
The effect of this is that Nigeria will stop importing refined petroleum products. Taming insecurity will magnetise investors and farmers back to their enterprises and farms. Tinubu must also rebuild the electricity sector, and concentrate on agriculture, SMEs and housing, which stimulate jobs, and production.
Nigeria’s warped ‘feeding bottle’ federalism, featuring the monthly sharing of revenue by indolent states, is the antithesis of prosperity. Therefore, Tinubu must be the pivotal campaigner for restructuring to reposition the states to drive production and poverty reduction..
