Dec 30, 2019

The decade of the very poor and the super rich

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Data: The World Bank and World Poverty Clock. Note: 1999-2015 World Bank figures are incomplete in South Asia. 2016-2019 figures are World Poverty Clock projections. Chart: Danielle Alberti/Axios

The 2010s may be remembered as the decade when the global 1% accumulated unfathomable wealth, but it was also perhaps the best decade ever for the world’s poorest people.

The big picture: The rate of extreme poverty around the world was cut in half over the past decade (15.7% in 2010 to 7.7% now), and all but eradicated in China.

A tipping point was reached in 2018, according to a Brookings analysis, with more than half the world in the middle class or above for the first time in history.

  • Along with that came massive declines in mortality rates for women and infants, both of which have been halved since 1990.
  • Meanwhile, primary education has become near-universal in nearly all of the world, including for girls. The global youth literacy rate was up to 91% as of 2016, though sub-Saharan Africa (75%) lags behind.
  • The average income of the world’s bottom 50% of earners nearly doubled between 1980 and 2016, according to Abhijit Banerjee and Esther Duflo, MIT professors and the 2019 Nobel laureates in economics.

The other side: There was only one group that fared better over that time, Banerjee and Duflo write in Foreign Affairs: the global 1%. “The rich in already rich countries plus an increasing number of superrich in the developing world… captured an astounding 27% of global growth.”

An examination of Forbes’ billionaire lists over the past decade tells much of the story:

  • In 2009, the world had 793 billionaires with a combined wealth of $2.4 trillion. There were 98 members of a more exclusive club: $5 billion or more.
  • As of 2019, the world had 2,153 billionaires with a total net worth of $8.7 trillion. Membership of the $5 billion club quadrupled to 424, and 166 people now have at least $10 billion.
  • To qualify as one of the world’s 100 richest people, you’d now need not $4.9 billion, as was the case a decade ago, but $14.4 billion.

The global picture: There were 130 billionaires in Asia a decade ago. Now there are 729, and 324 just in mainland China.

  • Billionaires weren’t the only ones to benefit. Generally speaking, the 2010s were a decade in which the world’s rich got much richer.

As the global 1% captured more and more of the pie, Banerjee and Duflo write, “The 49% of people below them, which includes almost everybody in the United States and Europe, lost out, and their incomes stagnated.”

  • There’s also cause for concern in China and India, which have been the primary drivers of global poverty reduction but are now experiencing slower growth.

The bottom line: Extreme poverty has fallen but not been eliminated, particularly in sub-Saharan Africa where poverty rates are stubbornly high and fast-growing populations mean more people now live in poverty than a decade ago.

  • A rising economic tide has lifted some to unprecedented heights, but millions around the world remain underwater.

Go deeper

The global cycle of violence, hunger and migration

Data: UNHCR; Chart: Naema Ahmed/Axios

The number of people killed in armed conflicts has fallen from a recent high of 143,409 in 2014 — the height of the Syrian civil war — to 77,392 last year, per the Uppsala Conflict Data Program.

Zoom in: That's still more people than were killed in 2009 and 2010 combined. This year's deadliest conflicts were in Afghanistan and Syria.

Go deeperArrowDec 30, 2019

World Bank cuts growth forecast for fourth time in a row

Photo: Win McNamee/Getty Images

The World Bank cut its global growth forecast for the fourth straight time on Wednesday, reducing expectations by 0.2 percentage points each year for 2019, 2020 and 2021.

"Global economic growth is forecast to edge up to 2.5% in 2020 as investment and trade gradually recover from last year’s significant weakness but downward risks persist. ... U.S. growth is forecast to slow to 1.8% this year, reflecting the negative impact of earlier tariff increases and elevated uncertainty."
— World Bank statement on its Global Economic Prospects report
Go deeperArrowJan 9, 2020

World Bank changes hiring rules after asking Taiwanese staff to get Chinese passports

World Bank President David Malpass. Photo: Mandel Ngan/AFP via Getty Images

The World Bank has revised its staff rules after Axios reported in December that the bank had asked Taiwanese employees to obtain Chinese passports.

Why it matters: The revised rule, issued on Dec. 19, states that the World Bank gives hiring preference to nationals from member states, but does not prohibit hiring non-member state nationals. China has sought to squeeze out Taiwanese nationals from international institutions. The World Bank's new rules represent a compromise position.

Go deeperArrowJan 9, 2020