Sluggish growth, low human capital, labour market weaknesses, and exposure to shocks are holding Nigeria’s poverty reduction back, the World Bank has said.
The global financial institution stated this in a report titled ‘A Better Future for All Nigerians: Nigeria Poverty Assessment 2022’.
“It is clear that much needs to be done to help lift millions of Nigerians out of poverty, including boosting health and education, bolstering productive jobs, and expanding social protection,” said Shubham Chaudhuri who is the World Bank Country Director for Nigeria.
“Yet implementing pro-poor initiatives requires unlocking fiscal space; reforming expensive subsidies – including fuel subsidies – will be essential, alongside countervailing measures to protect the poor as reforms are effected.”
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The report represents the culmination of the bank’s engagement on poverty and inequality-relevant data and analytics in the country in the last two years.
It draws primarily on the 2018/19 Nigerian Living Standards Survey (NLSS), which provided the country’s first official poverty numbers in almost a decade, as well as the Nigeria COVID-19 National Longitudinal Phone Survey (NLPS).
The World Bank stated that it implemented the surveys in collaboration with the National Bureau of Statistics (NBS).
According to the report which brings together the latest evidence on the profile and drivers of poverty in Nigeria, as many as four in 10 Nigerians live below the national poverty line.
It added that Many Nigerians – especially, in the country’s North – also lack education and access to basic infrastructure, such as electricity, safe drinking water, and improved sanitation.
The report further noted that jobs do not translate Nigerians’ hard work into an exit from poverty, as most workers were engaged in small-scale household farm and non-farm enterprises while 17 per cent of workers hold the wage jobs best able to lift people out of poverty.
Climate and conflict shocks, it stated, are multiplying and their effects have been compounded by the COVID-19 pandemic while the government’s support for households has been inadequate.
“Households have adopted dangerous coping strategies, including reducing education and scaling back food consumption, which could have negative long-run consequences for their human capital,” the bank said in a statement.
“These issues affect some parts of Nigeria more than others; the report captures this spatial inequality by providing statistics at the state level, which is crucial given Nigeria’s federal structure.”
On the way forward, the report suggested at least three types of deep, long-term reforms to foster and sustain pro-poor growth and raise Nigerians out of poverty.
They include macroeconomic reforms – including fiscal, trade, and exchange rate policy; policies to boost the productivity of farm and non-farm household enterprises; improving access to electricity, water, and sanitation while bolstering information and communication technologies.
The World Bank believes these reforms will help diversify the economy, invigorate structural transformation, create good, productive jobs, and support social protection programmes as well as other redistributive government policies.
As the country’s population continues to grow, it stressed the need to seize the promise of its young people for economic prosperity.