INSUBCONTINENT EXCLUSIVE:
The world&s 26 poorest countries, home to 40% of the most poverty-stricken people, are more in debt than at any time since 2006 and
increasingly vulnerable to natural disasters and other shocks, a new World Bank report showed on Sunday.The report finds that these
economies are poorer today on average than they were on the eve of the COVID-19 pandemic, even as the rest of the world has largely
recovered from COVID and resumed its growth trajectory, Reuters reported.Released a week before World Bank and International Monetary Fund
annual meetings get underway in Washington, the report confirms a major setback to efforts to eradicate extreme poverty and underscores the
World Bank&s efforts this year to raise $100 billion to replenish its financing fund for the world&s poorest countries, the International
Development Association (IDA).The 26 poorest economies studied, which have annual per-capita incomes of less than $1,145, are increasingly
reliant on IDA grants and near-zero interest rate loans as market financing has largely dried up, the World Bank said
Their average debt-to-GDP ratio of 72% is at an 18-year high and half of the group are either in debt distress or at high risk of it.Most of
the countries in the study are in sub-Saharan Africa, from Ethiopia to Chad and Congo, but the list also includes Afghanistan and Yemen,
read the report.Two-thirds of the 26 poorest countries are either in armed conflicts or have difficulty maintaining order because of
institutional and social fragility, which inhibit foreign investment, and nearly all export commodities, exposing them to frequent
boom-and-bust cycles, the report said.&At a time when much of the world simply backed away from the poorest countries, IDA has been their
lifeline,& World Bank chief economist Indermit Gill said in a statement
&Over the past five years, it has poured most of its financial resources into the 26 low-income economies, keeping them afloat through the
historic setbacks they suffered.&IDA normally is replenished every three years with contributions from World Bank shareholding countries
It raised a record $93 billion in 2021 and World Bank President Ajay Banga is aiming to exceed that with more than $100 billion in pledges
6.Natural disasters have also taken a greater toll on these countries over the past decade
Between 2011 and 2023, natural disasters were associated with average annual losses of 2% of GDP, five times the average among
lower-middle-income countries, pointing to the need for much higher investment, the World Bank said.The report also recommended that these
economies, which have large informal sectors operating outside their tax systems, do more to help themselves
This includes improving tax collections by simplifying taxpayer registration and tax administration and improving the efficiency of public
spending.The post World Bank says 26 poorest nations in worst financial shape since 2006 first appeared on Ariana News.
