A new World Bank report shows that the world's 26 poorest countries, where about 40% of the poorest people live on less than $2.15 a day, are burdened by debt at the highest level since 2006 and are more vulnerable to natural disasters and other shocks. Among the poor countries mentioned in the report are four Arab countries: Sudan, Somalia, Syria, and Yemen, according to the World Bank.
However, international aid as a share of GDP to these countries has fallen to its lowest level in two decades, forcing many of these economies to obtain financing on difficult terms.
The report, published yesterday, Sunday, concludes that these economies are today poorer on average than they were immediately before the coronavirus pandemic, despite the rest of the world's countries largely recovering from the repercussions of the pandemic and resuming their growth path.
Major setback
The report, released ahead of the annual meetings of the International Monetary Fund and World Bank in Washington in a week, underscores the major setback in efforts to eradicate extreme poverty and highlights the World Bank's efforts this year to raise $100 billion to replenish its fund for the poorest countries, known as the International Development Association.
The bank said the 26 poorest countries in the study, with per capita incomes of less than $1,145 a year, increasingly rely on IDA grants and loans at near-zero interest rates, with financing severely scarce. The average debt-to-GDP ratio in these economies reached 72 percent, its highest level in 18 years.
Most of the countries included in the study are located in sub-Saharan Africa, from Ethiopia to Chad and Congo, but the list also includes Afghanistan and Yemen.
The report indicated that two-thirds of the 26 poorest countries are either suffering from armed conflicts or are facing difficulties in maintaining order due to institutional and social fragility that hinders foreign investment and obstructs almost all exports.