With an estimated 900 million people in 2012 living on less than $1.90 a day, the updated international poverty line, and a projected 700 million in 2015, extreme poverty remains unacceptably high and more concentrated in Sub-Saharan Africa and South Asia. (World Bank Group Flagship Report -Global monitoring Report 2015/2016).
According to the report, despite solid development gains, progress has been uneven, and significant work remains.
Overall, the Millennium Development Goals played an important role in galvanizing the global development community, and that experience will help drive progress toward achievement of the Sustainable Development Goals by 2030.
Addressing moderate poverty and mitigating the vulnerability of falling back into poverty have become more pressing issues in many countries, including in those where the bottom 40 percent saw their incomes decline.
Even in a world of single-digit extreme poverty, non-income disparities, such as limited access to quality education and health services, pose a bottleneck to sustained poverty reduction and shared prosperity. Wider environmental sustainability concerns are a major challenge throughout the world, in regard to climate change and its impact on the natural resources upon which many of the poorest depend, such as water.
While development progress was impressive, it has been uneven and a large unfinished agenda remains. Three key challenges stand out: the depth of remaining poverty, the unevenness in shared prosperity, and the persistent disparities in non-income dimensions of development.
More than 90 percent of poverty is concentrated in pre- and early-dividend countries with swelling working-age populations that lag in key human development indicators and continue to register rapid population growth. In these countries, the demographic transition to lower fertility creates a golden opportunity to raise living standards.
Over 85 percent of global economic activity and 78 percent of global growth over the last 15 years can be attributed to late- and post-dividend countries, which have much-lower fertility rates and some of the highest shares of the elderly in the world. In these countries, population aging may weaken growth prospects.
To be sure, demographic change is not inherently good or bad and presents opportunities and challenges everywhere. In each case, policies can make a critical difference in how demographic change affects progress toward the development goals. Navigating the dynamic implications of demographic change will require sound policies informed by a long-run perspective and tailored to a nation’s demographic context. To eradicate persistent poverty, the centers of global poverty need to accelerate their demographic transition, invest in their young and still-growing populations, and lay the foundations for sustained growth.
Among other policy initiatives, these goals require better education and health services, as well as greater empowerment of women. Facing weakening economic dynamism, the lower-fertility, richer countries that make up the current engines of global growth need to address headwinds arising from shrinking labor forces.