Extreme poverty in Asia underestimated, bank says

Breaking News August 20, 2014 16:05

2,271 Viewed

Manila - Rising food costs and vulnerability to natural and man-made crises are not adequately taken into account when measuring extreme poverty in Asia, a regional report said Wednesday.

Adjusting for these factors could derail Asia's efforts to eradicate official extreme poverty by 2030, the Asian Development Bank said in an annual report on key economic indicators.
"In 2030, the number of extremely poor could still be 708.43 million, or 17.1 per cent of the region's population," under the suggested new calculation, up from the currently projected 1.4 per cent, it said.
Extreme poverty is currently measured as living on less than 1.25 dollars a day. By that count, the rate fell from 54.7 per cent of the population in 1990 to 20.7 per cent in 2010 amid strong economic growth in the region.
If trends continue, it would fall to 2.5 per cent by 2025 and 1.4 percent by 2030. Poverty below 3 per cent is interpreted as eradicated, the Manila-based bank said.
But Wednesday's report said a closer analysis shows that the conventional poverty line does not take into account volatile food costs and increasing vulnerability, and should be raised to 1.51dollars per person per day in Asia.
The new threshold would reclassify a further 9.8 per cent of the population as extremely poor, the report said, and factoring in food insecurity would add another 4 percentage points to the poverty rate.
Accounting for vulnerability to natural disasters, climate change, illness and economic crises would hike the extreme poverty rate by yet 11.9 more percentage points, the report added.

Most view