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The Percentage of Nigerians Living in Extreme Poverty Could Increase by 2030

 

Figure 1: Heatmap showing countries with the highest incidence of expected extreme poverty in 2030; Source: World Poverty Clock

In late June 2018, the international press cited World Poverty Clock data in several articles discussing the notion that Nigeria now has more people living in extreme poverty than any other country in the world. This blog post aims to briefly supplement this press coverage by providing some additional data drawn from World Data Lab’s World Poverty Clock and other models.

The outlook for poverty alleviation in Nigeria is currently weak. Today extreme poverty in the country is increasing by nearly six people every minute. If current trends persist, we expect this poverty “escape rate” to improve modestly over the next decade, to approximately 3 people every minute. Nevertheless, the overall effect will be muted; by 2030 we estimate the percentage of Nigeria’s population living in extreme poverty will increase from 44.2% to 45.5%, representing a total of some 120 million people living under $1.90 per day.  

But even beyond the domain of poverty alleviation, Nigeria’s changing demographics -- and the associated implications for employment and public finances -- will increasingly require attention from policymakers. With average population growth of approximately 2.34% per annum, we estimate that by 2030, Nigeria’s population will grow to some 263 million people, 150 million of which will be below the age of 25. Moreover, if current economic trends persist, we forecast that between 2018 and 2030 real GDP growth (2.15% per annum) will be unable to keep up with population growth, resulting in an average annual growth of GDP per capita of less than zero. These trends may have consequences for particular cohorts of the population, such as Nigerian Youth (under 25) who, according to our projections, could see their mean disposable income decrease by approximately 9% between 2018 and 2030.

Nigeria in the Broader Global Context

Of course, Nigeria’s outlook is only one piece of a broader global poverty narrative, one that is increasingly concentrated on the African continent. We predict that by 2030,  more than 400 million people will still live in extreme poverty in Africa. Moreover, we expect poverty to increase in many countries on the continent. By the end of 2018, we anticipate there will be some 3 million more people living in extreme poverty in Africa than there were at the beginning of the year. Among the 15 countries where we forecast that extreme poverty will rise over the next decade, 13 of them are in Africa -- and of the five countries where we expect the rate of extreme poverty rate (i.e. the percentage of the total population living on less than US $1.90 per day) to increase over the next decade, four are in Africa.

 

Forecasted Extreme Poverty Rate (%)

 

2018

2030

South Sudan

85

95

Burundi

74

85

Congo 

45

54

Nigeria

44

46

Venezuela

15

23

     Table 1: Extreme Poverty Rates for Select Countries, 2018 and 2030; Source: World Poverty Clock

Methodological note:

The World Poverty Clock’s methodology was peer-reviewed by the academic community and published here. Specific information for the Nigeria forecasts can be found here. Our forecasting data comes from public sources, including the World Bank, the IMF, the United Nations and IIASA. Income distribution information comes from the General Household Survey (GHS) initiative which is a collaboration between Nigeria’s National Bureau of Statistics, the Bill and Melinda Gates Foundation and the World Bank. Forecasts related to income, disaggregated by age cohorts, are derived from an extension of the World Poverty Clock model and methodology.

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