And the total number of people added to the world’s extreme poor as a result of the pandemic could grow to 150 million by next year.
“Global extreme poverty is expected to rise in 2020 for the first time in over 20 years as the disruption of the Covid-19 pandemic compounds the forces of conflict and climate change, which were already slowing poverty reduction progress,” the report added.
The group now expects extreme poverty to affect between 9.1% and 9.4% of the world’s population this year. Prior to the outbreak of coronavirus, the poverty rate was expected to drop to 7.9% in 2020.
About eight in 10 of those who will be pushed into extreme poverty this year live in what the World Bank calls “middle-income” countries: developing nations such as Brazil, Indonesia and South Africa that already have high poverty rates.
The report also notes that growing numbers of people in urban areas are likely to fall into extreme poverty, an issue that has traditionally affected mostly people in rural areas.
And while stock market gains in a number of countries may be spurring some optimism about recovery, the World Bank said the coronavirus crisis has diminished what it calls “shared prosperity” — the ability of a country’s poorest to benefit from economic growth.
That means the pandemic could increase income inequality and lower social mobility among the poor, unless governments enact significant policy interventions, according to the report.
“The deceleration in economic activity intensified by the pandemic is likely to hit the poorest people especially hard,” the report states. “The prospect of less inclusive growth is a clear reversal from previous trends.”