WBG: Eliminating Extreme Poverty Requires Urgent Focus on Fragile and Conflict-Affected Countries

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Urgent action is needed in countries impacted by fragility, conflict and violence (FCV) to end extreme poverty globally, according to the World Bank Group. As crisis situations become increasingly protracted — with dire impacts on people and economies — the World Bank Group today released an FCV strategy, which for the first time systematically brings a full suite of financing and expertise to address these challenges in both low-and-middle income countries.

On the current trajectory, by 2030 up to two-thirds of the world’s extreme poor will live in fragile and conflict-affected countries, according to a World Bank report also released today. Bucking the overall trend of a global decrease in extreme poverty, these countries are seeing sharp increases, threatening decades of progress in the fight against poverty. Fragile and conflict-affected situations take a huge toll on human capital, creating vicious cycles that lower people’s lifetime productivity and earnings and reduce socioeconomic mobility. One in five people in these countries are deprived of money, education and basic infrastructure simultaneously. And the number of people living in close proximity to conflict has nearly doubled in the past 10 years.

“Addressing humanitarian crises requires immediate support and long-term development approaches,” said World Bank Group President David Malpass. “To end extreme poverty and break the cycle of fragility, conflict, and violence, countries need to ensure access to basic services, transparent and accountable government institutions, and economic and social inclusion of the most marginalized communities. These kinds of investments go hand in hand with humanitarian aid.”

The World Bank Group now emphasizes working before, during, and after crisis situations to tackle poverty. It emphasizes prevention by proactively addressing the root causes of conflict — such as social and economic exclusion, climate change and demographic shocks — before tensions turn into full-blown crises. During active conflict, it focuses on building institutional resilience and preserving essential services like health and education for the most vulnerable communities.

The strategy also emphasizes long-term support to help countries transition out of fragility, including private sector solutions, such as scaling-up investments in small and medium enterprises that are essential to create jobs and spur economic growth. It addresses the cross-border impacts of FCV, for example by focusing on the development needs of both refugees and host communities.

In Sub-Saharan Africa, the majority of the extreme poor live in fragile and conflict-affected countries, and fragility and conflict have a destabilizing effect across borders. In response, the World Bank has been scaling up its support to FCV countries in Africa through the International Development Association (IDA). Over the past three years, IDA commitments to FCV countries in Africa nearly doubled from about $6bn in IDA17 to $11bn so far in IDA18. In the next three years, the World Bank will invest over $7 billion in the Sahel.

In fragile contexts across the region, the focus has been on delivering services and improving the wellbeing of the most vulnerable, particularly women in insecure areas, and addressing the drivers of fragility. In Somalia, mobile money has helped provide cash payments to families affected by drought and provided the government with e-payment solutions to expand service delivery. In the Central African Republic, the LONDO program («stand-up» in Sango) is providing temporary employment to the most vulnerable and increasing families’ incomes and well-being. In Burundi, the Democratic Republic of Congo, South Sudan and other countries, Geo-Enabling for Monitoring and Supervision is helping improve the monitoring and impact of projects.

This institutional shift is backed by increases in financing, both through the World Bank’s General Capital Increase and through the recently approved replenishment of IDA, the World Bank’s fund for the poorest countries, which included over $20 billion for FCV. The Bank and IFC will also make key operational changes, such as deploying more staff and resources to countries impacted by FCV and partnering with a range of international and local actors. IFC and MIGA have also committed to significantly increase their support to private sector investments in economies impacted by FCV.

 

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