COVID-19 and Poverty: An Inevitable Link That Is Little Understood

Mother Teresa once said, “we often think that poverty is only being hungry, naked and homeless. The poverty of being unwanted and uncared for is the greatest poverty." COVID-19 has changed the world in many ways. The shift from classrooms to mobile screens is evident, and the move from crowded celebrations to secluded festivities is too apparent. From jet lag to Zoom fatigue, the world has moved on tirelessly, if not effortlessly. What remains persistent is COVID-19 exacerbating the core issues that the world was already struggling with, the most significant of which being global poverty. 

When the epicentre of the virus shifted from China to Europe, and further ahead to the United States, slowly making its way into comparatively poorer countries like that of Asia and Africa; nations that were already struggling to satisfy its populations' needs were rushed into a sense of emergency as their healthcare systems struggled hard to make ends meet. 

David Debucquet in his paper, Impacts of COVID-19 on Global Poverty, Food Security and Diets, claims that to understand the surge of global poverty in the COVID era, one must focus on the factors that are initiating it. He believes that the pandemic's impact on labour supply, the constant need for social distancing, reduction in savings and investment, coupled with lower demand for certain goods and services has pushed a major section of the populations of Asian countries into a state of joblessness and reduced options of income-earning opportunities. 

And what seems to be inevitable is that for most economies the global recession and financial crises that COVID-19 has caused are far more intense than the financial crisis seen in 2008-2009. David Debucquet states that “the increases in poverty are concentrated in South Asia and Sub-Saharan Africa with impacts harder in urban areas than in rural areas. The COVID-19-related lockdown measures explain most of the fall in output, while declines in savings soften the adverse impacts on food consumption. Almost 150 million people are projected to fall into extreme poverty and food insecurity.”

The International Labour Organisation (ILO) has attempted to understand how poverty has aggravated in the COVID era. According to their report published in 2020, the organisation estimated that during the first three quarters of 2020, the number of working hours worldwide declined by 17% relative to that in the last quarter of 2019; a drop equivalent to a loss of almost 500 million full-time jobs. 

However, such figures tell us precious little. Homi Kharas, a senior fellow in the Center for Sustainable Development, in his article claims that it is surprising, and a harsh reality of the study of income poverty caused by COVID-19 that the world is less likely to know the full answers to the questions about it. He says that most of the poverty-related data that we find today has been collected from household surveys since it is close to impossible to conduct full-blown proper surveys in current conditions. He predicted that “compared to 2019, poverty in 2020 could rise by 120 million people. Compared to the baseline path for poverty, the 2020 figure is 144 million people higher. Some of this will be offset as economies start to recover in 2021, but the longer-term scenario suggests that half of the rise in poverty could be permanent. By 2030, the poverty numbers could still be higher than the baseline by 60 million people.” And if one goes by SDG indicators, Kharas was right. 

The year 2020 did see a rise in poverty by 124 million (approx), of which 60% stem from South Asian countries. Some consider COVID-19 a temporary form of shock to the financial setups of most countries. This is interesting to note since countries such as China faced a sharp V-shaped recession and recovery, which most observers find fascinating and relevant. But, we must not overlook the economic damage that such quick shifts can cause has long term and almost everlasting effects on populations that have been pushed into poverty. Kharas claims that in terms of understanding poverty linked with COVID-19 one has to decipher what living with poverty entails and how long it lasts? 

Kharas says, “The experience of living with poverty for short periods is harsh, but some families have coping mechanisms—assets they can sell, assistance from governments, relatives, and neighbours. But over longer periods, poverty leaves permanent scars—malnutrition, disease susceptibility, missed schooling. For this reason, it is useful to look at the longer-term impact of COVID-19 on poverty, despite all the caveats associated with any decade-long economic forecasts.”

The impact of COVID-19 has essentially attacked income security and employment opportunities but what remains eminently visible is that the biggest threat that prevails is to food security. Reduction in incomes can not only cause a subsequent decline in demand for food items, but also encourage shifts in the mix of products consumed, notably resulting in less consumption of more nutrient-rich foods (like fruits, vegetables, and animal-sourced foods) and comparatively more calorie-rich foods (like essential grains and sugar). This drives up food insecurity. Context-specific estimates of the impacts of poverty and food insecurity are to some extent accessible; it will be years before wide-ranging and relevant survey-based information on these impacts will be presented to general public knowledge.

Calculating the repercussions of the poverty impact of COVID-19 is no inconsequential topic to discuss and debate, it requires substantial and effective fixes that need to come about sooner than we think. This is not only because the crisis is still unfolding and available information of its precise socio-economic consequences is incomplete, but also because the channels of power are numerous and interconnected globally. Scholars have boiled their analysis of poverty in the COVID era down to the idea that “while several analyses of the poverty impacts have used simple tools provided by the World Bank’s website and assumed uniform shifts in the distribution of income per country to provide estimates of the impacts on poverty, (see, for example, the studies by the World Bank in Mahler et al., 2020 and World Bank, 2020b; and that of UN-WIDER by Sumner et al., 2020), we are concerned that this assumption fails to account for the complexity of the channels of effect and may substantially underestimate the impacts of the pandemic.” 

Nevertheless, the need of the hour remains in using effective methodology concerning understanding the effects of poverty and the arising need to solve the issues with it; As Nelson Mandela had once said, “Overcoming poverty is not a gesture of charity. It is an act of Justice.”


Aniba Junaid

Aniba Junaid is currently an undergraduate student of Political Science at Loreto College, Kolkata, India. She enjoys writing about Indian politics, culture, women and matters that affect one and all.

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