daniel chigunwe
Business Writer
Higher food and energy prices combined with the weakening of global demand, shocks related to Covid-19, and extreme weather events have driven more southern African people into poverty, casting a shadow on the goal to end poverty by 2030.
Per capita, income growth for most countries in the region is short of the growth rate needed to reverse the increase in poverty induced by the pandemic and to put the region on track to meet Sustainable Development Goals, the latest report on the region’s economic outlook by the African Development Bank (AfDB) show.
Extreme poverty is defined as living on less than US$1,90 a day. Poverty can be defined in different ways, mostly depending on where one lives in the world. Relative poverty relates to what a particular society considers to be poor. For example, someone in the UK might be considered to be relatively poor if they live on less than the average UK income whereas absolute poverty is when someone does not have access to basic human needs such as water, clothing, education, and shelter.
With weak global demand and tighter, monetary policies slowing down economic recovery, most countries have registered poor per capita income growth in 2022.
With the exception of Botswana and Mauritius, all countries had a GDP growth rate per capita below 2 percent, with three nations recording negative per capita income growth.
“By and large, high poverty and inequality remain endemic across the Southern Africa,” said the report, pointing to Madagascar and Zimbabwe as nations with the highest poverty level and is likely to have widened the level of inequality in the region.
“Inequality within Southern African countries has widened as net food and oil importers were more severely affected by rising fuel and food prices,” said AfDB. “Inflation is a regressive tax which disproportionately penalises the poor. Hence, within countries, the gap between rich and poor is likely to have broadened as elevated food prices tend to affect more the poorest households than the richest.
The AfDB has noted that poverty in Zimbabwe remains very high at 65 percent using the Low and Middle-Income Countries thresholds. Most of the poor survive on subsistence farming and are vulnerable to climate shocks, it added while the tight fiscal space was limiting the Government’s space to alleviate poverty levels.
“While the Government has done well to lift many people out of hunger by boosting food security, it still has a mammoth task to deal with other facets of poverty including provision of safety nets to the poor, provision of clean water and access to good health and education facilities,” Harare based economist Carlos Tadya said.
“These are some of the critical aspects needed if the country is to achieve upper middle income by 2030, also the target set by the United Nations to end poverty in all its forms.”
The World Bank said in March this year while extreme poverty in Zimbabwe has declined since its peak in 2020, it remains high in the context of cyclical agricultural production and elevated food prices. “Persistent inflation, high dependence on low-productivity agriculture, slow structural transformation, and intermittent shocks like drought, natural disasters, and the Covid-19 pandemic have contributed to the high rate of poverty and vulnerability in Zimbabwe,” it said.
Development economists pointed out the need to scale up adaptive social protection systems to lessen the impact of shocks in times of crisis and boost household resilience.
Building climate-smart agriculture and transforming agri-food chains are also critical to accelerating economic transformation.
Bongani Ndlovu