This month’s meeting of the International Comparison Program (ICP) Governing Board marked a new chapter in one of the world’s most far-reaching statistical operations. The release of the 2011 ICP round results in 2014 was met with some disagreement among scholars, but a dominant view emerged that they represent an improvement over the 2005 round. The release triggered a revision of the international poverty line which was updated from $1.25 / day in 2005 PPPs to $1.90 / day in 2011 PPPs. The IMF also uses the resulting PPPs in its Quota subscription allocation, as does the UNDP in the calculation of the Human Development Report’s Human Development Index (HDI), and a number of the SDGs involve PPPs in their measurement.
The ICP estimates purchasing power parities, or PPPs, for use as currency converters to compare the size and price levels of economies around the world. PPP-based measures are critical for assessing the real living conditions of individuals in different countries, and for establishing a common yardstick for measuring progress. Just as important as what it does is how it does it - the ICP is a partnership, and a great example of how working together can yield great benefits to all stakeholders.
The Global ICP Unit - part of the official statistical architecture
The World Bank is now home to the permanent Global ICP Unit, which has this year been instituted as a formal part of the global statistical program by the United Nations Statistical Commission (UNSC). This development puts the ICP on a stable long-term footing and is a testimony to the ICP’s collective efforts to ensure the success and continuity of the program.
Since its establishment in 1968, the ICP has grown to cover all regions of the world and become the world’s largest statistical initiative. The 2011 round of the ICP covered 199 economies from eight regions with the help of 15 regional and international partners.