Coronavirus crisis could plunge half a billion people into poverty

The fallout from the coronavirus spread that has killed more than 83,000 people and wreaked havoc on economies around the world could push around half a billion people into poverty, Oxfam said on Thursday.

The report released by the Nairobi-based charity ahead of next week’s International Monetary Fund (IMF)/World Bank annual meeting calculated the impact of the crisis on global poverty due to shrinking household incomes or consumption.

“The economic crisis that is rapidly unfolding is deeper than the 2008 global financial crisis,” the report found.

Under the most serious scenario – a 20% contraction in income – the number of people living in extreme poverty would rise by 434 million people to 922 million worldwide. The same scenario would see the number of people living below the $5.50 a day threshold rise by 548 million people to nearly 4 billion.

Women are at more risk than men, as they are more likely to work in the informal economy with little or no employment rights.

The World Bank last week said poverty in East Asia and the Pacific region alone could increase by 11 million people if conditions worsened.

To help mitigate the impact, Oxfam proposed a six-point action plan that would deliver cash grants and bailouts to people and businesses in need and also called for debt cancellation, more IMF support, and increased aid. Taxing wealth, extraordinary profits, and speculative financial products would help raise the funds needed, Oxfam added.

Calls for debt relief have increased in recent weeks as the fallout from the COVID-19 pandemic has roiled developing nations around the world.

In total, governments around the world would need to mobilise at least $2.5 trillion to support developing nations.

This article has been posted by a News Hour Correspondent. For queries, please contact through [email protected]
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