Poverty in Africa is bad, right? Well, sort of. The World Bank has some interesting statistics that reveal more hopeful news, though.
Rates of poverty in Kenya are steadily declining—which is the story for much of Africa. In 2005, which is the last year household poverty data was collected, relative poverty in Kenya was at 47%. Current projections, based on updated World Development Indicators measured by the World Bank, place it around 32%. That’s a reduction rate of roughly 2 percentage points per year.
How has this happened? The answer is growing GDP. For the past decade, Kenya’s annual GDP growth rate has hovered around 5%. For comparison, the United States’ growth is around 2%. If its economy continues to grow at this pace, Kenya will actually meet the UN’s new millennium development goal of eradicating extreme poverty by 2030.
However, Kenya still has major hurdles to overcome. The most recent Kenyan economic report directs attention to three areas the country needs to improve in order to maintain its growth:
- It needs to radically challenge job-opportunity inequality and discrimination to open up competitive jobs and encourage innovation.
- Kenyan policy-makers need to focus on job-creation and tax policies that will mobilize more workers and encourage investment and savings.
- Industry in Kenya needs diversification and development so that the country can shift the balance away from imports and toward exports.
The authors of the latest World Bank Report, however, are confident that the country is on its way to implementing these reforms and rising to the development standard set by the global community.
– John Mahon