The World Bank has a plan to review the poverty index over inflation and others across the world.
It was gathered that it plans to revise the global poverty line from $1.90 to $2.15 due to an increase in the price of the basic needs of man.
The plan was disclosed in a Fact Sheet post titled ‘An Adjustment to Global Poverty Lines’, which was published on the bank’s website.
The post reads, “As differences in price levels across the world evolve, the global poverty line has to be periodically updated to reflect these changes. Since 2015, the last update, we have used $1.90 as the global line. As of fall 2022, the new global line will be updated to $2.15.
“The new global poverty line is set at $2.15 using 2017 prices. This means that anyone living on less than $2.15 a day is considered to be living in extreme poverty. Just under 700 million people globally were in this situation in 2017.”
World Bank disclosed that the real value of $2.15 in 2017 prices is the same as what $1.90 was in 2011 prices.
It added, “The global poverty line is periodically updated to reflect changes in prices across the world. The rise in the International Poverty Line reflects an increase in the costs of basic food, clothing, and shelter needs in low-income countries between 2011 and 2017, relative to the rest of the world. In other words, the real value of $2.15 in 2017 prices is the same as $1.90 was in 2011 prices.”
On the level of poverty in Sub-Saharan Africa, it stated, “However, Sub-Saharan Africa is still the region where extreme poverty is most prevalent.”
The World Bank over the years has revised the international poverty line from $1 a day in 1985 purchasing power parities to $1.08 with 1993 PPPs, to $1.25 with 2005 PPPs, and to the $1.90 line with 2011 PPPs used today.
Aside from the current $1.90 international poverty line, the World Bank tracks two other poverty lines that show the typical national poverty lines in lower-middle-income countries ($3.20 per day) and upper-middle-income countries ($5.50).
These lines will be adjusted upward, to $3.65 and $6.85 respectively.