Similarly, as countries grow, their definitions of what constitute basic needs change. The cost of performing the same function may differ across countries depending on their overall level of income. To monitor this, the World Bank has introduced a societal poverty line based on the typical level of consumption or income in each country. In 2015, over a quarter of the world’s population survived on $3.20 per day and nearly half of the world still lived on less than $5.50 per day. Data suggest that the rapid gains against extreme poverty have not been matched by reductions in the number of people living below these higher levels of income. The World Bank now reports on two higher-value poverty lines: $3.20 and $5.50 per day. These lines, which are typical of standards among lower- and upper-middle-income countries, respectively, are designed to complement, not replace, the $1.90 international poverty line. Since a lack of reliable data is associated with slow income growth for the poorest, the situation could be even worse than currently observed.Īs the world grows wealthier and extreme poverty becomes more concentrated, there are legitimate questions over whether $1.90 is too low to define whether someone is poor in all countries of the world. In half of the countries in the world, extreme poverty is at or below 3 percent, but that doesn’t mean the fight to eradicate poverty is over in these countries. Only one in four low-income countries and four of the 35 recognized fragile and conflict-affected states have data that allows us to monitor shared prosperity over time.

More worrying, among poorer economies monitored in which extreme poverty rates remain high (particularly those in Sub-Saharan Africa), income growth at the bottom has on average been lower than in the rest of the world. In two-thirds of the 14 extremely poor countries, average incomes are increasing at an annual rate below the global average of 2 percent. Another worry is that data needed to assess shared prosperity is weakest in the very countries that most need it to improve. However, slow economic progress is hindering shared prosperity in some regions, particularly in some Europe and Central Asia which experienced negative or low levels of shared prosperity.

Strong income growth among the bottom 40 is also observed among various Baltic countries, as they recover from the crisis in the late 2000s. Latin America and the Caribbean saw less growth in shared prosperity than in the recent past, but at 3.2 percent per year the bottom 40 experienced sizeable income growth. On shared prosperity - defined as the growth in income of the bottom 40 percent in each country - the picture looks mixed. In 70 of the 91 countries for which data were available, incomes of the bottom 40 percent improved between 20. In addition, in 54 percent of those 91 countries, their income grew faster than the average. Progress in East and South Asia has been more impressive with the bottom 40 percent growing annually by 4.7 percent and 2.6 percent respectively from 2010 to 2015. By 2030, under all but the most optimistic scenarios, poverty will remain in double digits in Sub-Saharan Africa. In 2015, more extreme poor lived in that region than in the rest of the world combined. But the rate dropped only one percentage point in the two years from 2013 to 2015. In fact, the total number of poor in Sub-Saharan Africa has been increasing. In the 25 years from 1990 to 2015, the extreme poverty rate dropped an average of a percentage point per year – from nearly 36% to 10%. The number of people living on less than $1.90 a day fell during this period by 68 million to 736 million.ĭespite the tremendous progress in reducing extreme poverty, rates remain stubbornly high in low-income countries and those affected by conflict and political upheaval. The world has made tremendous progress in reducing extreme poverty. The percentage of people living in extreme poverty globally fell to a new low of 10 percent in 2015 - the latest number available - down from 11 percent in 2013, reflecting continued but slowing progress.

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