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UN: Covid plunged 77 million into poverty before Ukraine war

According to the U.N., 812 million people lived in extreme poverty on $1.90 a day or less -- in 2019, and by 2021 amid the pandemic the number had risen to 889 million.

By: AP |
April 13, 2022 9:39:05 am
The report was produced by the U.N. Department of Economic and Social Affairs in collaboration with more than 60 international agencies, including the U.N. system and international financial institutions. (File)

The pandemic plunged 77 million more people into extreme poverty last year and many developing countries can’t recover because of the crippling cost of debt repayments — and that was before the added impact of the war in Ukraine, a U.N. report said Tuesday.

The report said rich countries could support their recovery from pandemic slumps with record amounts borrowed at ultra-low interest rates. But the poorest countries spent billions of dollars servicing their debts and faced much higher borrowing costs, preventing them from spending on improving education and health care, protecting the environment and reducing inequality.

According to the U.N., 812 million people lived in extreme poverty on $1.90 a day or less — in 2019, and by 2021 amid the pandemic the number had risen to 889 million.

The report is on financing to achieve U.N. development goals for 2030, including ending poverty, ensuring quality education for all young people and achieving gender equality.

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U.N. Deputy Secretary-General Amina Mohammed said at a news conference that the effort “is coming at a critical moment for humanity, adding to the compounding crises of climate assaults on our natural systems and the protracted COVID-19 pandemic.”

Added to this, she said, is the global impact of the war in Ukraine. A U.N. analysis indicates “1.7 billion people are faced with exposure to spiking food, energy and fertilizer costs as a result of the war in Ukraine,” Mohammed said.

The report estimates that GDP per capita in 20% of developing countries will not return to pre-2019 levels by the end of 2023, even before absorbing the impact of Russia’s war in Ukraine.

It says the poorest developing countries, on average, pay 14% of their revenue for interest on their debts, with many forced to cut budgets for education, infrastructure and capital spending as a result of the pandemic. Rich developed countries pay only 3.5%, it says.

The war in Ukraine will exacerbate these challenges, the report said, and it will also bring higher energy and commodity prices, renewed supply chain disruptions, higher inflation, lower growth and increased volatility in financial markets.

Mohammed said “it would be a tragedy” if rich donor nations increased military expenditures as a result of the war and cut aid to developing countries and reduced efforts to address the climate crisis.

The U.N. already was “off track” in efforts to reach the U.N. development goals before the pandemic hit and brought new problems, she said. Now, the war and its impact will set these efforts back again, “so the big message is that we need more resources,” she said.

“There is no excuse for inaction at this defining moment of collective responsibility, to ensure hundreds of millions of people are lifted out of hunger and poverty,” Mohammed said. “We must invest in access for decent and green jobs, social protection, health care and education leaving no one behind.”

The report’s recommendations include speeding up debt relief and expanding eligibility to highly indebted middle-income countries, aligning the international tax system to address such issues as inequality in availability of coronavirus vaccines and access to medical products, accelerating investment in sustainable energy, and improving information sharing.

The report was produced by the U.N. Department of Economic and Social Affairs in collaboration with more than 60 international agencies, including the U.N. system and international financial institutions.

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