A new World Bank report showed that the 26 poorest countries in the world, where about 40% of the poorest people live (on less than $2.15 a day), have become burdened with debt at the highest level since 2006 and are more vulnerable to being affected by natural disasters and other shocks. Among the poor countries mentioned in the report are 4 Arab countries: Sudan, Somalia, Syria, and Yemen.
However, international aid as a share of these countries’ GDP has shrunk to its lowest level in two decades, forcing many of these economies to access financing on difficult terms.
The report – which was published yesterday, Sunday – concludes that these economies are poorer today on average than they were immediately before the Corona pandemic, despite the rest of the world’s countries having largely recovered from the repercussions of the pandemic and resuming their growth path.
Major setback
The report, which was issued before the start of the annual meetings of the International Monetary Fund and the World Bank in Washington a week later, confirms the major setback to efforts to eradicate extreme poverty, and highlights the World Bank’s efforts this year to raise $100 billion to replenish the resources of its fund to finance countries. The poorest is known as the International Development Association.
The bank stated that the 26 poorest countries included in the study, whose per capita income is less than $1,145 annually, are increasingly relying on IDA grants and loans at near-zero interest rates, in light of the significant scarcity of available financing. The average debt-to-GDP ratio in these economies reached 72%, its highest level in 18 years.
Most of the countries included in the study are located in sub-Saharan Africa, from Ethiopia to Chad and Congo, but the list also includes Afghanistan and Yemen.
The report indicated that two-thirds of the 26 poorest countries either suffer from armed conflicts or face difficulties in maintaining order due to institutional and social fragility that hinders foreign investment and hinders almost all exports.
Natural disasters have also caused huge losses in these countries over the past decade.
The IDA’s resources are usually renewed every 3 years with contributions from countries participating in the World Bank. The foundation raised a record amount of $93 billion in 2021.
According to the World Bank, the list of the 26 poorest countries in the world includes: Afghanistan, Burundi, Burkina Faso, Central Africa, the Democratic Republic of the Congo, Eritrea, Ethiopia, Gambia, Guinea Bissau, Liberia, Madagascar, Mali, Mozambique, Malawi, Niger, North Korea, Rwanda, Sudan, Sierra Leone, Somalia, South Sudan, Syria, Chad, Togo, Uganda, and Yemen.
