25 April 2019

Nigeria: World Bank Expresses Concern Over Rising Poverty in Nigeria, Calls for Action

The World Bank has once again expressed concern over the high level of poverty in Nigeria.

The Washington-based institution stated this in its 'Poverty and Equity in Nigeria,' for April 2019, which was obtained by THISDAY Wednesday.

"Nigeria remains a country with high levels of poverty. Based on the most recent preferred survey of the National Bureau of Statistics (NBS), extreme poverty in 2009 is estimated at 53.5 per cent using the international poverty line of $1.90 per person per day (2011 PPP)," it stated.

According to the report, in 2018, poverty was projected at 50 per cent, indicating little improvement in incomes of the bottom half of the population over the past decade.

It noted that poverty trend in Nigeria, "loosely followed macroeconomic developments due to high oil dependence, regional differences and a high population growth rate."

The bank added: "In 2010-2014, average economic growth rates were moderately high, driven by high oil prices. However, growth was concentrated in the coastal areas and the capital, thereby yielding limited benefits to the rest of the country.

"In late 2014, oil prices began to plummet, and Nigeria subsequently fell into a recession in 2016. Though growth weakly rebounded in 2017, the benefits were insufficient to reduce least, because unemployment and underemployment remain high, each affecting over one-fifth of the labour force.

"Moreover, high inflation continues, especially food inflation, which disproportionately affects the poor since food comprises about three-quarters of their consumption basket."

In addition, the report pointed out that an additional setback to poverty reduction was from increased violent conflict. This, it stated, had led to low agricultural production, population displacement, and disruption in basic services provision, especially in the North-east and Middle Belt.

The report added: "There is significant variation in poverty and social indicators in general across Nigeria. In the northern part of the country, projected poverty rates have been increasing, while in the southern part, the poverty incidence appears to have fallen significantly.

"The divergence in welfare trends indicates large regional disparities in living standards due to many factors, ranging from the availability of jobs and access to services to returns on human capital and the size of the private sector.

"Estimates of welfare indicate that inequality is increasing and the poor's share of aggregate consumption is falling. This reflects the lack of gainful employment opportunities, especially for low skilled workers."

The National Bureau of Statistics (NBS) had conducted two household surveys that it relies on to measure welfare and to produce its official poverty statistics: the 2003/04 Nigeria Living Standard Survey (NLSS) and the 2009/10 Harmonised NLSS. The former survey replaced previous surveys with a greater scope that incorporated modules on demography, health, fertility behaviour, education, skills/training, employment, housing, social capital, agriculture, and household income and expenditure.

The 2009/10 added additional modules. Both surveys are representative at the national and state levels.

The next round of HNLSS began in September 2018 and would continue for 12 months. The NBS factored in the lessons learned from the 2009-2010 NLSS to draw the sample, improve the questionnaire, and implement the survey. The team drew a sample of 22,200 households with a two-stage sampling approach to be representative at the state level, covering 36 states and the Federal Capital Territory. Data from the upcoming HNLSS will be used to compute the poverty rates at the national, geopolitical, zonal and state levels.

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