Extreme poverty rates continue to fall


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We will spare no effort to free our fellow men, women and children from the abject and dehumanizing conditions of extreme poverty . . . We resolve further to halve, by the year 2015, the proportion of the world’s people whose income is less than one dollar a day.
—United Nations Millennium Declaration (2000)

Extreme poverty is defined as average daily consumption of $1.25 or less and means living on the edge of subsistence. The number of people living in extreme poverty has been falling since 1990, slowly at first and more rapidly since the turn of the century. The largest reduction has occurred in East Asia and Pacific, where China has made great improvement. Sub-Saharan Africa, which stagnated through most of the 1990s, has begun to reduce the number of people in extreme poverty.

The proportion of people living in extreme poverty in East Asia and the Pacific has fallen by more than 50 percent since 1990, exceeding the target of the first Millennium Development Goals. China’s success in lifting more than 500 million people out of extreme poverty dominates the regional average, but other countries in the region have recorded their own successes. Not shown in the chart are upper-middle income economies such as Malaysia and Thailand, where poverty rates have remained below 2 percent. Also missing are many small and island economies for which data are not available.

Measured at the extreme poverty line of $1.25 a day, poverty rates in most Middle East and North African economies are quite low. With the exception of Yemen -- the only low-income economy in the region where poverty rates have risen in recent years, rates of extreme poverty are typically less than four percent. The average poverty rate for the region in 2005 was estimated to be 3.6 percent and that is expected to be cut in half by 2015. For middle-income economies, however, a poverty line of $2 a day is more representative. Measured at this level, the average poverty rate in the region fell from 19.7 percent in 1990 to 16.3 percent in 2005. Despite the recent growth slowdown, the poverty rate measured at $2 a day is expected to fall to 8.3 percent by 2015.

Although the decline was slowed by the global financial crisis, the number of people living in extreme poverty is expected to fall to around 900 million by 2015, even as the population living in developing countries rises to 5.8 billion. Still, an additional 1.1 billion people will live on less than $2 a day.

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