The first goal of the Sustainable Development Goals (SDGs) is to combat poverty in all its forms everywhere. Poverty is a global and long-standing issue. Significant efforts have been made globally to eradicate poverty, and much progress has been witnessed in the last three decades. China and India have dominated this success story; however, there is still a long way to go in fighting the scourge of poverty, particularly in developing countries. 

According to the World Bank, the rate of poverty reduction has slowed down in recent years. Between 2020 and 2023, efforts to reduce poverty experienced more setbacks due to the pandemic's impact, global supply chain disruptions, geopolitical tensions, climate shocks, and a high inflationary environment. With these in view, achieving the first SDG before 2030 is becoming increasingly difficult. They reported that about 712 million people in low-income countries (almost 9% of the world’s population) live in extreme poverty, i.e. they spend less than $2.15 per day. They also projected that by 2030, 7% of the global population will still live in extreme poverty, and most of them will be from Sub-Saharan Africa (SSA) or countries exposed to state fragility and conflicts.

Multidimensional Poverty Index

The definition of poverty has grown beyond adopting income level as the single measure. Poverty is multidimensional; it encompasses other basic needs like health, education, sanitation, clean water, social well-being, etc. Multidimensional poverty is an index that captures a wide range of indicators and measures the percentage of people deprived of these necessities. It is broadly classified as health, education, and standard of living (including income). 

The United Nations Development Programme (UNDP) and the Oxford Poverty and Human Development Initiative (OPHI) developed a Multidimensional Poverty Index (MPI) for countries across the seven continents. The index captures the impact of three deprivations, namely health, education, and standard of living, on lives and livelihoods.  It is a well-recognized measure of Multidimensional Poverty and is widely used globally. According to the report, about 57% of the poor live in lower-middle-income countries, while 37% and 8% live in low-income and upper-middle-income countries, respectively.  They also reported that 1.1 billion of 6.1 billion people are multidimensionally poor. This alarming figure indicates that 18% of the global population is poor. Approximately 90 million of these poor live in upper-middle-income countries, while about 387 million live in low-income countries. Also, 639 million of them live in lower-income countries. Sadly, 566 million of these poor people are children under 18 years old. These striking numbers show that the victory over eradicating poverty everywhere is far from reality, and there is a need for more aggressive responses in combating it. 

Sub-Saharan Africa (SSA) hosts the world’s poorest people. 

Understanding the geographical location of the poorest people is crucial when formulating effective policies. According to UNDP and OPHI’s report, Sub-Saharan Africa has the highest number of impoverished people, while 84% reside in rural communities. Approximately five of six poor people live in either SSA (534 million) or South Asia (389 million).

The severity of poverty in SSA is very high and particularly concerning. The region has the most significant number of poor people and the most extreme levels of poverty, i.e., it is home to the poorest of the poor, with 99 million people grappling with basic needs such as food, clean water, sanitation, education, and health care. Nigeria has a large share of this figure in SSA. A report by Brookings showed that SSA countries would account for 9 out of the ten leading countries in poverty headcount by 2030. In addition, their report further indicated that Nigeria, the Democratic Republic of the Congo, Mozambique and Somalia will be top global poverty destinations in the next decade.

Multidimensional Poverty in Nigeria

In 2019, the World Bank named Nigeria the world’s headquarters of poverty, with roughly 37% of the population living below the poverty line. This number increased to 44% in 2024, indicating that Nigeria still holds this title. This emphasises the need for urgent efforts and reforms to alleviate poverty in the country.

The National Multidimensional Poverty Index report by UNDP and OPHI showed that 63 % of Nigerians, about 133 million people, are multidimensionally poor. This number grew by 16% between 2019 and 2022. Furthermore, the child Multidimensional Poverty Index is very high in Nigeria, especially in rural areas where about 90% of children are considered poor. A further look into the data of the geo-political zones shows that the prevalence of poverty is higher in the North-East and North-West, where 90% of children are identified as poor. Contrarily, in the South-East and South-West, poverty rates are lower at 74% and 65.1%, respectively. Additionally, the incidence of Child MPI exceeds 50% in all states, while it is greater than 95% in Bayelsa, Sokoto, Gombe, and Kebbi states.

Factors Contributing to Multidimensional Poverty in Nigeria 

Several factors contribute to the accelerated increase in MPI. These include high food prices and inflation rates, social unrest and insecurities, climate change, and low levels of investment in health and education, to mention a few. 

• Rising Food Prices and Inflation rates

The astronomical hike in food prices in Nigeria is worsening the country's poverty levels. The prices of staple food items such as rice, beans, tomatoes, pepper, and onion have increased significantly compared to previous years, making essential food items unaffordable and exacerbating living conditions. Subsistence and low levels of agricultural production, insecurity, climate change and policy mismatch are the major factors driving these rising food prices. In addition, the persistent rise in the general price level, reflected in high energy costs, high cost of transportation, housing, and other essential services, has weakened the purchasing power of most vulnerable households, deepening poverty levels across the country. The generally low level of economic productivity and supply-side constraints have continued to fuel inflationary pressure in the country.

• Social Unrest, Insecurity  and Conflicts 

It is no news that the high levels of social unrest, insecurities, and conflicts, particularly in the northern part of the country, have displaced millions of Nigerians, threatening the lives of many and alienating them from living a decent life as they face limited or no access to food, shelter, and basic amenities like education and health. In addition, climate change is exacerbating the prevalence of poverty in Nigeria; for example, the heavy rains and recent flooding in Borno state led to the collapse of the already weak Alau Dam and its reservoir. This affected over one million Nigerians and displaced about four hundred and fourteen thousand (414,000) people.  Also worrisome is the anticipated and eventual food price hike as a result of the flooding. Supply of food crops from the state will decline, thereby worsening the prevalent food crises in the country. 

• Low Level of Investment in Health and Education 

The low level of investment in health and education has deepened the prevalence of poverty in Nigeria.  The World Bank also alluded to the fact that public spending on education and health is low and inadequate by any standard. For example, the total government spending on health as a percentage of GDP in 2022 is 4.1%; this is lower than the average spending in SSA (17.2%) and the lower-middle-income countries (18.2%). This low level of investment is one of the factors responsible for low health outcomes and low literacy levels in the country. The reliance on out-of-pocket payments for health services and private education at primary, secondary and tertiary levels excludes a significant part of society from accessing basic healthcare services and quality education.

Policy Options or Recommendations 

• Effectively Targeting the Poor

The weak targeting of the poor is a key reason for the lack of significant reduction in multidimensional poverty in Nigeria. To address this, government parastatals and philanthropy organisations focusing on poverty alleviation can leverage Artificial Intelligence (AI) to access accurate data to efficiently identify the poor or use a reliable external data validation system. This would help in the distribution of palliatives in the form of food distributions, cash transfers, and other welfare packages to support livelihoods. For example, GiveDirectly, a non-profit organisation facilitating direct cash transfers to people living in extreme poverty, adopted AI-driven flood forecasting models to identify the most vulnerable to seasonal floods and give them cash before the flooding occurred in Nigeria. They collaborated with local communities and used satellite, flood mapping, and government data to identify the most susceptible areas. GiveDirectly has identified 52 villages across the country as severely vulnerable and has commenced direct cash transfers. This approach can be adopted by governments, philanthropy organisations, international development organizations and other stakeholder groups. Implementing this would improve the impact and effectiveness of targeted interventions to achieve maximum outcomes and better impact.

• Strategic Investments in Health and Education 

There is a need to increase investment in human capital through education and healthcare across the 36 states of the country. Specifically, the Northeastern and Northwestern states require focused and aggressive investments in education through skill acquisition and vocational training programs. Similarly, the government should build state-of-the-art primary and secondary schools with well-trained teachers in these areas. They should also strengthen primary healthcare centres across the states to support children and adults in improving their well-being. This is essential to reducing abject poverty and promoting inclusiveness and economic development in the county. In addition, the private sector can also invest in health and education through social impact initiatives and financing. An example of such investment is the Adopt-A-Healthcare-Facility Programme (ADHFP), a private sector-led initiative designed to improve primary healthcare services in Nigeria. The purpose of the program is to establish new primary healthcare centres (PHCs) or upgrade existing ones across local government areas in the country. These centres aim to provide affordable and accessible healthcare services, particularly for the poor and vulnerable. The private sector can create and invest in more of such initiatives that will aid in poverty eradication.

• Boost productivity in the economy.

It is very imperative for the government to target policies to boost economic productivity by investing heavily in employment-elastic sectors like the agricultural and manufacturing sectors. As productivity increases, unemployment falls while income levels also increase. This will have a trickle-down effect on poverty eradication in the country. The private sector can also complement the government to increase productivity through funding, entrepreneur support programs, and skill development initiatives that stimulate economic activity and job creation. An example is the Tony Elumelu Foundation (TEF) Entrepreneurship Program, which provides seed capital or funding and training to young entrepreneurs in Africa, empowering them to create businesses and jobs, ultimately improving their lives and livelihoods. 

References

Kharas, H. (2022). The evolution of global poverty, 1990-2030. Brookings Institution. https://www.brookings.edu/articles/the-evolution-of-global-poverty-1990-2030/

National Bureau of Statistics Nigeria. (2022). Multidimensional poverty index. https://nigerianstat.gov.ng/elibrary/read/1241254

National Bureau of Statistics Nigeria. (2022). Multidimensional poverty index. https://www.mppn.org/wp-content/uploads/2022/11/MPI_web_Nov15_FINAL

United Nations Development Programme. (2023). Global multidimensional poverty index 2023: Unstacking global poverty – Data for high-impact action. https://core.ac.uk/download/572523853.pdf

World Bank. (2024). Human capital public expenditure and institutional review. https://documents1.worldbank.org/curated/en/099062424122052532/pdf/P1768901361c910261a816182a0804756d9.pdf

World Bank. (2024). World development indicators. https://data.worldbank.org/country/nigeria