Which countries reduced poverty rates the most?

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One of the goals of the World Bank Group is to reduce extreme poverty—defined as living on less than $1.90 per day in 2011 PPP—to less than 3% by 2030. We know that the world has seen tremendous progress in reducing extreme poverty since 1990. So, where in the world has poverty reduction been most successful?

The graph below shows 15 countries that experienced the largest annual average percentage point declines in extreme poverty rate between about 2000 and 2015, out of the 114 countries for which we can measure poverty in a comparable way over this period.

In each of these countries, an average of at least 1.6% of the population moved out of extreme poverty every year. This meant 802.1 million fewer people were living in extreme poverty in these 15 countries between 2000 and 2015. For example, between 2000 and 2011, the extreme poverty rate fell by 36.9 percentage points in Tanzania, from 86.0% to 49.1%, for an annual average rate of reduction of 3.2 percentage points, which led to a reduction of 5.3 million in the number of Tanzanians living in extreme poverty. Tajikistan, Chad, and the Republic of Congo had average reductions in poverty of around 3 percentage points per year.

While extreme poverty remains endemic in low-income and conflict-affected countries, many of which are in Sub-Saharan Africa, there is cause for optimism even in these countries. Seven of the top 15 countries are in Africa, and two are on the World Bank Group’s Harmonized List of Fragile Situations for FY19.

Some of the 15 countries (China, Kyrgyz Republic, Moldova, Vietnam) effectively eliminated extreme poverty by 2015. In others (e.g. India), low rates of extreme poverty in 2015 still translated to millions of people living in deprivation. In some of the countries in Sub-Saharan Africa (e.g. Democratic Republic of Congo, Tanzania, Burkina Faso), extreme poverty rates, even after rapid reduction, remain above 40%.

These 15 high performers make up a diverse group of countries—by geographic location, average income levels, poverty rates, and size of the population and the economy:

  • Two of these countries were lower middle-income countries in 2000 and rose to upper middle-income status by 2015; eight were low-income countries in 2000 and rose to lower middle-income status by 2015; and five remained low-income countries over the entire period.
  • The countries had vastly different poverty rates at the turn of the century—the extreme poverty rate ranged from 94.1% in DRC (2004) to 28.6% in Pakistan (2001).
  • Their populations ranged from 2 million for Namibia (2003) to 1.3 billion for China (1999).
  • The size of their economy ranged from $861 million for Tajikistan to $1.2 trillion for China in 2000, in current U.S. dollars.

Notes on Data Selection:

Data are extracted from the PovcalNet database. Two data selection criteria were applied; (1) Countries should have at least two surveys—one between 1995 and 2005 and another between 2010 and 2019. (2) The same welfare measures, either income or consumption, should be used for those surveys. Applying these restrictions, 114 countries were selected, including high-income countries.

Countries marked with * indicates that the poverty rate from the two surveys are not fully comparable. Nepal, Niger, Gambia, Guinea, Solomon Islands, and Ecuador were removed due to low confidence in their data comparability.

Kyrgyz Republic data in 2000 uses HBS survey for 2000.

Growth rate calculation uses survey year, which could be different from reference year.

Median income information is based on PovcalNet and Global Database of Shared Prosperity.

Reference: Historical country classification by income

Join the Conversation

Judith Lungu
November 27, 2019

Interesting data. I want to know changes in SADC countries

Sunil Jayantha Nawaratne
November 27, 2019

I am from Sri Lanka and working in the poverty reduction field from year 2000. Vvery keen to do research in this field

Dilip Kumar
November 27, 2019

Useful information for me

Abubakar Mohammed
November 27, 2019

If we do more then poverty rate will decrease by the coming years

Putra
November 27, 2019

Good share and article

Mohammed Danjuma Haruna
November 27, 2019

Hi,
I have gone through the report and I am particularly glad that 7 out of the 15 high performing countries are in Africa. Don't mind my bias it's because I am African.

However, I believe the world bank could assist more countries in Africa to escape extreme poverty, through investment in institutional restructuring and more investments in Human Capital, infrastructure and governance system.

Take
November 27, 2019

The struggle we have been experiencing in Africa is about political position not poverty reduction.

Ameer
November 27, 2019

its useful for me since im a researcher in poverty issues

Benedict Makanga
November 27, 2019

This is an awesome article. Thank you for the great insights.

Was also interested in looking at trends of the Ugandan Economy.

Great work, am very interested in such works.

OSEI SARPONG
November 27, 2019

Thanks very much for this educative post. We, in the republic of Ghana, are seeing a tremendous changes in our lives. So I wish my country Ghana be included in the next post. Thank you.
OSEI SARPONG
I.T STUDENT
REPUBLIC OF GHANA

Parekraj Acharya
November 27, 2019

What is the rate of poverty reducing each year I.e 2018

Rabindra Suwal
November 27, 2019

Hi, I am confused on "Nepal....were removed due to low confidence in their data comparability." What does it mean? Could you explain in layman language?

Manfred Spaeth
November 27, 2019

Thank you for your interesting update! Did WB research also cover potential conceptual changes of poverty data collection due to collaboration of WB with UN Stat and/or other stakeholders within the MDG and SDG context? Kind regards, Manfred

Marco van den Heuvel
November 27, 2019

Dear Team,

Great blog. I lived and worked 14 years in Namibia. Namibia is not listed in the extreme poverty rate table and no explanation is given for this. Please advise.
Furthermore I’d be interested to hear your take on Namibia’s high Gini Coefficient and its higher-middle income categorization.

Thanks

hajaratu musah
November 27, 2019

This is good news however more could be done. Indeed my team and I believe that one of the critical strategies to reduce poverty (particularly in Africa) is to reduce corruption in public spending of governments. The simple reason is that government spending especially in Africa is huge and corruption in public procurement is having a huge toll on scarce resources.
It is time to free Africa from the shackles of poverty and make it a Better place for all!

Comrade Akingbola Temidayo Feyisara
November 27, 2019

Your statistic and data is very correct. Poverty is prevalent in Asia and Africa continents and government in this countries are looting the patrimony, more and more.

Golam Muhammad Areef
November 27, 2019

What about Bangladesh?

David Harold Chester
November 27, 2019

To eliminate poverty, not merely reduce it, we need to see that the opportunities for working are no longer being stopped by the monopolists and speculators in useful sites of land. In many of the above countries, the rights for access to useful sites are being withheld and their values being speculated in. Any rent that tenant farmers are being charged includes too much of the values of their produce and because the landlord has a monopoly right there is no way for the tenant to not give up in rack rent a lot of what he/she has earned by hard work in the fields.

If a government REALLY wants to eliminate poverty and to give equal opportunity and not the so-called equality without fair chances to work, then they need to pass a law and enforce it for land value taxation (LVT). Then any landlord not making proper use of his/her land will be inclined to sell it to somebody else who will.

A wise and sensible government would recognize that this problem derives from lack of opportunity to work and earn. It can be solved by the use of a tax system which encourages the proper use of land and which stops penalizing everything and everybody else. Such a tax system was proposed almost 140 years ago by Henry George, a (North) American economist, but somehow most macro-economists seem never to have heard of him, in common with a whole lot of other experts. (I would guess that they don't want to know, which is worse!) In “Progress and Poverty” 1879, Henry George proposed a single tax on land values without other kinds of tax on produce, services, capital gains, etc. This regime of land value tax (LVT) has 17 features which benefit almost everyone in the economy, except for landlords and banks, who/which do nothing productive and wrongly find that land dominance has its own reward.

17 Aspects of LVT Affecting Government, Land Owners, Communities and Ethics

Four Aspects for Government:

1. LVT, adds to the national income as do all other taxation systems, but it can and should replace them.
2. The cost of collecting the LVT is less than for all of the production-related taxes—then tax avoidance
becomes impossible because the sites being taxed are visible to all.
3. Consumers pay less for their purchases due to lower production costs (see below). This creates
greater satisfaction with the government’s management of national affairs.
4. The national economy stabilizes—it no longer experiences the 18 year business boom/bust cycle, due
to periodic speculation in land values (see below).

Six Aspects Affecting Land Owners:

5. LVT is progressive--owners of the most potentially productive sites pay the most tax.
6. The land owner pays his LVT regardless of how his site is used. When fully developed, a large
proportion of the ground-rent from tenants becomes the LVT, with the result that land has less sales-
value but a significant "rental"-value (even when it is not being used).
7. LVT stops the speculation in land prices and any withholding of land from proper use is not
worthwhile.
8. The introduction of LVT initially reduces the sales price of sites, (even though their rental value can
still grow over long-term use). As more sites become available, the competition for them becomes less
fierce so entrepreneurs are more active.
9. With LVT, land owners are unable to pass the tax on to their tenants as rent hikes, due to the reduced
competition for access to the additional sites that come into use.
10. With LVT, land prices will initially drop. Speculators in land values will want to foreclose on their
mortgages and withdraw their money for reinvestment. Therefore LVT should be introduced
gradually, to allow these speculators sufficient time to transfer their money to company-shares etc.,
and simultaneously to meet the increased demand for produce (see below).

Three Aspects Regarding Communities:

11. With LVT, there is an incentive to use land for production or residence, rather than it being unused.
12. With LVT, greater working opportunities exist due to cheaper land and a greater number of available
sites. Consumer goods become cheaper too, because entrepreneurs have less difficulty in starting-up
their businesses and because they pay less ground-rent--demand grows, unemployment decreases.
13. Investment money is withdrawn from land and placed in durable capital goods. This means more
advances in technology and cheaper goods too.

Four Aspects About Ethics:

14. The collection of taxes from productive effort and commerce is socially unjust. LVT replaces this
extortion by gathering the surplus rental income, which comes without any exertion from the land
owner or by the banks--LVT is a natural system of national income-gathering.
15. Bribery and corruption on information about land cease. Before, this was due to the leaking of
news of municipal plans for housing and industrial development, causing shock-waves in local land
prices (and municipal workers' and lawyers’ bank balances).
16. The improved and proper use of the more central land reduces the environmental damage due to a)
unused sites being dumping-grounds, and b) the smaller amount of fossil-fuel use, when traveling
between home and workplace.
17. Because the LVT eliminates the advantage that landlords currently hold over our society, LVT
provides a greater equality of opportunity to earn a living. Entrepreneurs can operate in a natural
way-- to provide more jobs. Then earnings will correspond to the value that the labor puts into the
product or service. Consequently, after LVT has been properly introduced it will eliminate poverty
and improve business ethics.