MANILA: The Asian Development Bank (ADB) has recently unveiled a harsh reality that the confluence of the coronavirus pandemic and the escalating cost of living has driven nearly 70 million more individuals in developing Asia into the throes of extreme poverty.
This revelation, contained within the ADB’s latest report, casts a shadow over painstaking efforts to alleviate deprivation in the region.
According to the report released on a recent Thursday, the ADB notes that a staggering estimated 155.2 million people residing in developing Asia, constituting approximately 3.9 percent of the region’s population, found themselves trapped in extreme poverty last year. This number is a distressing escalation of 67.8 million compared to a hypothetical scenario where the health crisis and the cost-of-living challenges had not unfolded.
It’s crucial to clarify that the term “developing Asia” encapsulates 46 economies nestled within the expansive Asia-Pacific region, deliberately excluding prosperous nations like Japan, Australia, and New Zealand from its purview.
ADB’s Chief Economist, Albert Park, affirmed, that Asia and the Pacific are undoubtedly making strides in their recovery from the tumultuous impact of the COVID-19 pandemic. However, the parallel surge in the cost of living poses a formidable barrier to the advancement of poverty eradication endeavours.
This distressing situation of extreme poverty is defined as subsisting on less than $2.15 per day, as measured by 2017 benchmarks. Adding to this plight, inflation witnessed a surge across several countries, reaching multi-year highs last year. This surge was largely propelled by a rebound in economic activities and a cascade of supply chain disruptions.
While the inflationary surge affected people across various socioeconomic strata, its impact was most acutely felt by the economically disadvantaged. These individuals were disproportionately burdened as they had to allocate more of their meagre resources to food and fuel. Consequently, saving money and managing expenses for essentials like healthcare and education became even more unattainable.
Albert Park emphasized that governments across the region hold the key to remedying this escalating crisis. By bolstering safety nets that specifically cater to the impoverished and fostering an enironment conducive to investment and innovation, there is potential to realign the trajectory.”
Interestingly, despite the gloomy scenario, the ADB’s report indicated a relatively positive economic trajectory. Developing Asia was projected to achieve a growth rate of 4.8 percent this year compared to the previous year’s expansion of 4.2 percent, as per the ADB’s July projections.
Nevertheless, it’s important to temper this optimism. The ADB report paints a future where, despite anticipated strides in addressing poverty, approximately 30.3 percent of the population in the region—equivalent to roughly 1.26 billion individuals—will continue to wrestle with economic vulnerability by the year 2030. This projection underlines the necessity for concerted efforts to recalibrate economic and social policies to ensure sustainable and inclusive growth for the entire region.
