Pandemic reverses poverty reduction gains in Philippines: World Bank study-Xinhua

Pandemic reverses poverty reduction gains in Philippines: World Bank study

Source: Xinhua| 2022-11-24 17:30:30|Editor: huaxia

MANILA, Nov. 24 (Xinhua) -- The COVID-19 pandemic has partly reversed decades-long gains in reducing poverty in the Philippines, said the latest World Bank study released on Thursday, adding that income inequality remains "very high" in the Southeast Asian country.

Driven by high growth rates and expanding jobs, poverty rate in the Philippines fell to 16.7 percent in 2018, said the report. By 2018, the middle class in the 110-million population country had grown to nearly 12 million people, and the economically secure population had risen to 44 million.

But the pandemic halted economic growth in 2020, and unemployment shot up in industries requiring in-person work. In 2021, the national poverty rate rose to 18.1 percent.

"Recovery in the Philippines is uneven across the income distribution, and the poorest who suffered the most from COVID-19 have yet to fully recover their incomes," said the report, warning that the pandemic "is likely to result in long-term scarring of human capital development."

The report stresses the need to strengthen social assistance, tame inflation, reskill workers, promote entrepreneurship, and increase access to quality health care and education, among others, to build resilience and set the stage for a vibrant and inclusive recovery.

Ndiame Diop, World Bank Country Director for Brunei, Malaysia, the Philippines, and Thailand, also said "inequality is still very high in the Philippines."

According to the World Bank's report, the top 1 percent of earners together capture 17 percent of national income, with only 14 percent being shared by the bottom 50 percent. With an income Gini coefficient of 42.3 percent in 2018, the Philippines has one of the highest income inequality in East Asia.

"Inequality of opportunity and low mobility across generations wastes human potential and slow down innovation," said Diop.