Covid-19 pandemic, inflation pushed 68 million Asians into poverty in 2022: Asian Development Bank

The Covid-19 pandemic, coupled with a surge in the cost of living, have driven approximately 70 million more people in developing Asia into the grips of severe poverty last year, a recent Asian Development Bank (ADB) report has revealed.

According to the Asia and the Pacific 2023 report, an estimated 155.2 million individuals in developing Asia and the Pacific — equivalent to 3.9 percent of the region's population — faced extreme poverty in 2022.

Without the Covid-19 pandemic and the cost-of-living crisis, this figure would have been smaller by67.8 million people.

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As per the ADB, state of extreme povertyentails living on less than $2.15 a day, adjusted for purchasing power and inflation.

"Asia and the Pacific are making gradual strides towards recovery from the COVID-19 pandemic, but the mounting cost of living is eroding progress in poverty alleviation,"- saidAlbert Park, Chief Economist at the ADB.

The increased cost of living has emerged as a critical concern as individuals in developing Asia -- forty-six developing economies of Asia excluding Japan -- find themselves less capable of coping with elevated prices for essential commodities such as food and fuel.

The surge in prices of basic goods and services has not only impacted people's savings but also strained their ability to afford other necessities like healthcare, education, investments, and growth-enabling opportunities.

Poverty's costly toll: ADB's call to action

Report also highlighted a concerning trend: individuals grappling with poverty often pay a premium to access essential goods and services.

Take the example of low-income households, which frequently find themselves purchasing goods in smaller quantities — a costlier endeavor than buying in bulk.

Additionally, they might reside in informal settlements, exposing them to heightened health risks and subsequently increasing healthcare expenses.

While emerging economies in Asia and the Pacific show signs of progress against poverty, projections suggest that by 2030, around 30.3 percent of the region's population—equivalent to over 1.26 billion individuals—will still be economically insecure.This category is defined as living on $6.85 per day in 2017 prices.

To counteract the escalating cost of living, the report has urged governments across Asia and the Pacific to bolster social protection systems, amplify support for agricultural development, enhance access to financial services, prioritize strategic infrastructure investments, and foster technological innovation and human capital development.

These measures, the ADB argued, will help alleviate the strain on individuals facing economic vulnerabilities.

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