World Bank chief highlights 'tragic reversal' in development amid pandemic

Washington, Oct 14 (IANS): World Bank Group President David Malpass has said the Covid-19 pandemic is pushing up poverty and debt levels in low-income countries, highlighting a "tragic reversal" in development.

"It's already pushed nearly 100 million people into extreme poverty. That's the added number in extreme poverty," Malpass said on Wednesday at a virtual press conference during the IMF-World Bank Annual Meetings, Xinhua news agency reported.

"We're witnessing a tragic reversal in development. The progress in reducing extreme poverty has been set back by years - for some, by a decade," he continued.

Noting that inequality is worsening across country groups, Malpass said per capita income in advanced economies is growing nearly 5 per cent in 2021, compared to only 0.5 per cent in low-income countries.

"The outlook remains grim for most of the developing world. There's high inflation, there's too few jobs, there's shortages that extend to food, water, and electricity," he said, highlighting ongoing factory and port shutdowns, and the bottlenecks in logistics and supply chains.

In response to a question from Xinhua, the World Bank chief said that the backsliding on women, on children, and on the vulnerable are all tragic setbacks due to the pandemic and the global economic disruption.

"There needs to be a system of global international finance that is better suited toward people getting jobs in the poorest countries in order to reduce poverty," he said.

Malpass also stressed that many countries, especially the poor ones, are faced with debt challenges. In the International Debt Statistics released Monday, the World Bank estimated that debt burden in low-income countries rose by 12 per cent to a record $860 billion in 2020.

The report noted that even prior to the pandemic, many low- and middle-income countries were already in a vulnerable position, with slowing economic growth and public and external debt at elevated levels. External debt stocks of low- and middle-income countries combined rose 5.3 per cent in 2020 to $8.7 trillion.

Noting that many countries are in external debt distress or at high risk of it, Malpass told reporters that "we need a comprehensive approach, including debt reduction, swifter restructuring, and more transparency in order to make progress on this problem."

In the 15 months ending in June 2021, the multilateral lender committed $157 billion of financing to help countries in need, and "a chunk of it is in grants," according to Malpass.



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Comment on this article

  • Roshan, Mangaluru

    Thu, Oct 14 2021

    India missed the boat in development and progress already. We have 230million people slipped back to poverty in past 7yrs. Starting DeMo, the distruction of economy started and continues still. We have crores and crores of people losing jobs monthly, this is to add to existing unemployed. Middle class, somehow managing finds costs are going up, but income is slipping, the situation is hand to mouth. The rich 1 percent, enjoys cutting 550cakes on birthday, have parties in cruise ship, rushes to overseas resorts for tanning, buys breakfast delivered in helicopter, it goes on. Media is busy showing happiness and joy of these 1 percent rich, to ensure the underprevileged does not get depressed. Turnaround is not possible till there is fully competent government at center that focuses on core issues at micro-level, analysed by unbiased educators and scholars, with guts to speak freely. Current govt is too much into self image building and self branding, it is crumbling under burden of its own sins.

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