Eradicating extreme poverty by 2050?

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Emma Charlton, Writer, Forum Agenda

• The proportion of people in extreme poverty worldwide could fall below 2% in 2050 under the base forecast from the Center for Global Development.
• Eradicating extreme poverty for all everyone by 2030 is the first goal of the UN 2030 Agenda for Sustainable Development.
• Anyone living on less than $2.15 a day is in extreme poverty, according to the World Bank.

How do you define and measure poverty and extreme poverty? Or, put another way, what standards are necessary for a basic living?

The answer probably varies from country to country and it can be difficult to generalize across regions and continents. Drawing a line can be helpful for policymakers, as it gives them a barometer to work towards, as well as a basis against which to proclaim success, even if it’s not particularly ambitious for their country.

Nevertheless, some form of measurement is needed to track broad global progress.

And that’s important because eradicating poverty is the headline target of the United Nations Sustainable Development Goals, with Goal 1 being “end poverty in all its forms everywhere”.

COVID-19 and the challenge of ending poverty. Image: United Nations

Making sure everyone has enough money to meet their basic needs including food, clothing and shelter, is a key metric of how we’re doing as a society and is a core objective for politicians and policymakers all over the world. The World Economic Forum’s work underpins the United Nations SDGs, as set out on its Strategic Intelligence platform.

Anyone living on less than $2.15 a day is in extreme poverty, according to the World Bank.

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About 648 million people globally were in this situation in 2019, it says. And while global poverty rates increased during the COVID-19 pandemic, the general trend is for them to be falling.

While the Sustainable Development Goal committing the world to end extreme poverty by 2030 probably won’t be met, a new study from the Center for Global Development (CGD) forecasts that the proportion of people in extreme poverty worldwide will fall below 2% in 2050, from around 8% now.

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What is the World Economic Forum doing to promote sustainable urban development?

Cities are responsible for 75% of global greenhouse gas emissions and are home to over half of the world’s population—a number that will grow to two-thirds by 2050. By going greener, cities could contribute more than half of the emissions cuts needed to keep global warming to less than 2°c, which would be in line with the Paris Agreement.

To achieve net-zero urban emissions by 2050, the World Economic Forum is partnering with other stakeholders to drive various initiatives to promote sustainable urban development. Here are just a few:

• The Coalition for Urban Transitions is the first major global initiative aimed at helping countries achieve inclusive, sustainable economic growth through better urban policies. Consisting of 50 partner organizations, the coalition brings national governments into the process of decarbonizing our cities by connecting them with city leaders. Read our impact story to learn how this coalition is making a difference.
• The Zero Carbon Buildings for All Initiative pledges to fully decarbonize all new buildings by 2030 and all existing buildings by 2050.
• The Systemic Efficiency project arose from the Zero Carbon Buildings for All Initiative. Jointly led by the Forum’s Platform for Shaping the Future of Energy and Materials and the Platform for Shaping the Future of Cities, Infrastructure and Urban Services, the Systemic Efficiency project brings global policy-makers, financiers and the private sector together to create systemic change in the urban ecosystem by optimizing energy efficiency in buildings, transport and various industries.

To learn more about our initiatives to promote zero-carbon cities and to see how you can be part of our efforts to facilitate urban transformation, reach out to us here.

Charles Kenny, Senior Fellow, Center for Global Development, and Zack Gehan, a research assistant, forecasted a range of estimates for the state of global poverty in 2050, as part of a wider set of scenarios for the global economy in 2050.

“We use our own economic growth forecasts and the Stata functions embedded in the World Bank’s Poverty and Inequality Platform to predict 2050 poverty at two different lines, assuming within-country inequality remains the same over that time and consumption growth equals our predictions for GDP per capita growth,” they wrote in a blog post.

Several factors have compounded to make the economic outlook cloudier and less certain, hitting the poorest in society hard, including the energy crisis and the cost of living crisis. While the World Economic Forum’s Chief Economists Outlook highlighted the intensifying human impact of the cost of living crisis, which is worsening poverty, it also said the forces at work should peak this year. And the respondents to the survey appeared to largely agree, with a majority (68%) saying the crisis will be less severe by the end of 2023.

Poverty is not shared evenly across continents.

Most people who live in extreme poverty are in Sub-Saharan Africa. In 1990, 13% of people were living in extreme poverty lived in the region; in 2022, an estimated 62% of people living in extreme poverty lived in Sub-Saharan Africa, according to Development Initiatives.

The proportion of people in extreme poverty will fall to 7% from 29% across the continent of Africa, the CGD study shows. Under the optimistic forecast for Africa – with a higher growth rate between now and 2050 – extreme poverty falls below 2%.

The CGD work also looked at the proportion of people living on $10 a day.

In 2019, about 57% of the world lived on less than $10/day, including nearly nine out of 10 people in Africa and India.

The positive scenario showed this dropping to one in five in the world, one in five people in India and less than one-half of Africa’s population, the study showed.

While the overall message of the CGD report shows poverty levels are moving in the right direction, there is no space for complacency, with recent crises threatening to push the world off track from its goals.