Covid-19 has increased the need for social assistance, especially in low-income countries. The latest World Bank forecast (2022), suggests there will be only a gradual reduction in ‘extreme poverty’ over the next eight years, with 574-million people (6.8% of the world’s population) still living in extreme poverty in 2030.

While many of the extreme poor will be in middle-income countries, poverty rates as a proportion of the population are expected to remain highest in low-income countries. Even before Covid-19 there was a marked difference, with 44% of the population in extreme poverty in low-income countries compared with 10% in lower-middle-income countries.

Covid-19 has also increased the financing constraints that low-income countries face in funding social assistance, not least through the increasing number of countries at risk of reaching unsustainable levels of debt.

Paper by the Overseas Development Institute