The World Bank has said that no fewer than 10 million Nigerians were pushed into poverty in 2023 as a result of rising inflation and weak earnings.
In its Macro Poverty Outlook for Nigeria: April 2024, the World Bank said nominal earnings have drastically lagged behind the surging inflation rates, rendering the economic growth of the country insufficient to improve living standards.
“Nominal earnings have not kept up with inflation, pushing another 10 million Nigerians into poverty in 2023,” it said.
The World Bank further pointed out that the international poverty rate, which is pegged at $2.15 per day, stands at 30.9%, while the lower middle-income poverty threshold of $3.65 per day shows that 63.5% of the population lives in poverty, with another 90.8% below the upper middle-income poverty line of $6.85 per day.
The report attributed the situation to a combination of weak macroeconomic fundamentals and deep-seated structural constraints, including significant overreliance on the oil sector, the deteriorating performance of which has led to erosion in macroeconomic stability.
It also identified low state revenues, ineffective tax rates, and inadequate tax administration, among factors which collectively hamper the government’s capacity to provide essential public services.
The World Bank emphasised the critical need for continued ambitious reforms centered around macroeconomic stabilization.
It further projected an average growth of 3.5 per cent between 2024 and 2026, which marginally outpaces the population growth rate by 0.9 percentage points.
Despite these projections, the report noted that poverty rates are expected to increase in 2024 and 2025 before stabilizing in 2026, due to the initial impact of ongoing reforms and the prevailing high inflation rate, estimated to average 24.8% in 2024.
