Nigeria’s President Muhammadu Buhari on Tuesday inaugurated the Steering Committee of the National Poverty Reduction with Growth Strategy (NPRGS). This was to achieve his mission of lifting 100 million Nigerians out of poverty within a decade. Already, he has claimed that his administration has successfully lifted 10.5 million Nigerians out of poverty in the last two years; even though data shows Nigerians have been worse off during this period.
According to the National Bureau of Statistics (NBS); 40 percent of people who live in Nigeria live below the poverty line of N137,430 ($381.75) a year. Thus, representing 82.9 million people. Nigeria recorded a Per Capita GDP growth of -4.57 percent in 2020; its worst contraction in more than six years, which means Nigerians have grown poorer.
With two economic recessions in just five years; Nigeria’s growth rate has failed to match its average population growth rate of 2.6 percent. Rising food prices have pushed inflation to 17.93 percent in May 2021 compared to 12.04 recorded in the same time last year; squeezing consumers’ purchasing power and deepening poverty.
Nigeria’s unemployment rate has also risen to 33 percent in Q4 2020 from 21.8 percent in Q1 2018; the second highest in the world. More jobless Nigerians means more people in extreme poverty.
Nigeria’s strategy to beat poverty
With worsening social and economic indicators; the Federal Government’s plan to lift half the population out of poverty by 2030 sounds ambitious; but some countries have achieved this feat and Nigeria is taking a cue from China and India.
“The Chinese experience is an example. It has resulted in lifting over 700 million people out of poverty over the last four decades,” Buhari said when the committee was first introduced in September 2020.
During the inauguration on Tuesday, the Special Adviser to the President on Media and Publicity; Femi Adesina said Nigeria can follow India’s example.
“If India can lift 271 million people out of poverty between 2006 and 2016, Nigeria can surely lift 100 million out of poverty in 10 years.”
According to NPRGS, the total cost of the execution/implementation of the policies and programmes underpinning this strategy is estimated at US$1.6 trillion. Thus, giving an annual average of about US$161 billion.
This estimated cost covers the dual objective of lifting 100 million Nigerians out of poverty as well as of achieving all the country’s development objectives in line with the Sustainable Development Goals 2030.
The committee has also announced that it is considering the setup of a private equity fund; the Nigeria Investment and Growth Fund (NIG-Fund) which will lead resource mobilization and also manage the resources.
According to the President, the steering committee, among other things, will anchor collaborative efforts; provide oversight for the implementation of the strategy; guide the technical working group and federal ministries, extra ministerial departments and agencies; subnational governments and other stakeholders on meeting the objectives of the programme; as well as monitoring progress and any other effort that would enhance the attainment of the objective of lifting 100million people out of poverty in 10 years.
Countries that have the biggest fall in poverty rate
According to the World Bank, an estimated 1.1 billion people have been lifted out of poverty since 1990.
By 2015, according to the most recent data; 736 million people, or about 10 percent of the world’s population, were living in extreme poverty. This, the World Bank defines as living on the equivalent of $1.90 or less per day. The bank carried out a survey in 114 countries between 2000 and 2015 to assess which of these countries have the largest annual average percentage point declines in the extreme poverty rate. Of the countries surveyed, only 15 countries met this requirement.
These countries are China, India, Tanzania, Chad, Tajikistan, Congo Rep, Kyrgyz Rep, Moldova, Burkina Faso, Congo, Dem. Rep, Indonesia, Vietnam, Ethiopia and Pakistan. Of the 15 countries, the most significant decline in poverty rate was recorded in China, India, Tanzania, Kyrgyz Rep, Ethiopia and Vietnam.
The most obvious example was seen in China that has succeeded in lifting more than 850 million citizens out of extreme poverty within 40 years. This means on average, it lifted 21 million people out of poverty annually.
China has reduced the poverty rate from 40 percent in 2000 to 1 percent in 2015 with a 2.5 annual average reduction rate. China has been able to eliminate extreme poverty.
India cut its poverty rate from 38 percent in 2000 to 21 percent in 2015. This means it reduced the number of poor people by 2.4 percent yearly. Unlike China, India has been unable to eliminate extreme poverty as the low rates of extreme poverty in 2015 still translated to millions of people living in deprivation.
Tanzania almost halved its extreme poverty rate between 2000 and 2011, the period for which data was available.
The extreme poverty rate fell by 36.9 percentage points in Tanzania, from 86.0 percent to 49.1 percent, for an annual average rate of reduction of 3.2 percentage points, which led to a reduction of 5.3 million in the number of Tanzanians living in extreme poverty.
Just like China, Kyrgyz has reduced poverty from 42 percent in 2000 to 3 percent in 2015 with a 2.6 annual average reduction rate, although with a relatively smaller population. Kyrgyz has also eliminated extreme poverty.
Tanzania halved its extreme poverty rate from 61 percent in 2000 to 31 percent in 2015 with an annual average rate of reduction of 1.9 percentage points.
Vietnam has also eliminated extreme poverty as it slashed its poverty rate from 36 percent in 2000 to 2 percent in 2015. It reduced the poverty rate by 1.9 percent annually.
This story is part of a series by BusinessDay on the imperative of reducing poverty in Nigeria and how it can be achieved.
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Adapted from Business Day (Mercy Ayodele)