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Poverty headcount ratio at $1.90 a day (2011 PPP) (% of population) - Bangladesh

 

Poverty headcount ratio at $1.90 a day is the percentage of the population living on less than $1.90 a day at 2011 international prices. As a result of revisions in PPP exchange rates, poverty rates for individual countries cannot be compared with poverty rates reported in earlier editions.

  • ID: SI.POV.DDAY
  • Source: World Bank, Development Research Group. Data are based on primary household survey data obtained from government statistical agencies and World Bank country departments. Data for high-income economies are from the Luxembourg Income Study database. For more information and methodology, please see PovcalNet ( iresearch.worldbank.org/PovcalNet/index.htm ).
  • License:  CC BY-4.0 
  • Development Relevance: The World Bank Group is committed to reducing extreme poverty to 3 percent or less, globally, by 2030. Monitoring poverty is important on the global development agenda as well as on the national development agenda of many countries. The World Bank produced its first global poverty estimates for developing countries for World Development Report 1990: Poverty (World Bank 1990) using household survey data for 22 countries (Ravallion, Datt, and van de Walle 1991). Since then there has been considerable expansion in the number of countries that field household income and expenditure surveys. The World Bank`s Development Research Group maintains a database that is updated annually as new survey data become available (and thus may contain more recent data or revisions) and conducts a major reassessment of progress against poverty every year. PovcalNet is an interactive computational tool that allows users to replicate these internationally comparable $1.90, $3.20 and $5.50 a day global, regional and country-level poverty estimates and to compute poverty measures for custom country groupings and for different poverty lines. The Poverty and Equity Data portal provides access to the database and user-friendly dashboards with graphs and interactive maps that visualize trends in key poverty and inequality indicators for different regions and countries. The country dashboards display trends in poverty measures based on the national poverty lines alongside the internationally comparable estimates, produced from and consistent with PovcalNet.
  • General Comments: The World Bank’s internationally comparable poverty monitoring database now draws on income or detailed consumption data from more than one thousand six hundred household surveys across 164 countries in six regions and 25 other high income countries (industrialized economies). While income distribution data are published for all countries with data available, poverty data are published for low- and middle-income countries and countries eligible to receive loans from the World Bank (such as Chile) and recently graduated countries (such as Estonia) only. The aggregated numbers for low- and middle-income countries correspond to the totals of 6 regions in PovcalNet, which include low- and middle-income countries and countries eligible to receive loans from the World Bank (such as Chile) and recently graduated countries (such as Estonia). See PovcalNet (iresearch.worldbank.org/PovcalNet/WhatIsNew.aspx) for definitions of geographical regions and industrialized countries.
  • Limitations and Exceptions: Despite progress in the last decade, the challenges of measuring poverty remain. The timeliness, frequency, quality, and comparability of household surveys need to increase substantially, particularly in the poorest countries. The availability and quality of poverty monitoring data remains low in small states, countries with fragile situations, and low-income countries and even some middle-income countries. The low frequency and lack of comparability of the data available in some countries create uncertainty over the magnitude of poverty reduction. Besides the frequency and timeliness of survey data, other data quality issues arise in measuring household living standards. The surveys ask detailed questions on sources of income and how it was spent, which must be carefully recorded by trained personnel. Income is generally more difficult to measure accurately, and consumption comes closer to the notion of living standards. And income can vary over time even if living standards do not. But consumption data are not always available: the latest estimates reported here use consumption data for about two-thirds of countries. However, even similar surveys may not be strictly comparable because of differences in timing or in the quality and training of enumerators. Comparisons of countries at different levels of development also pose a potential problem because of differences in the relative importance of the consumption of nonmarket goods. The local market value of all consumption in kind (including own production, particularly important in underdeveloped rural economies) should be included in total consumption expenditure but may not be. Most survey data now include valuations for consumption or income from own production, but valuation methods vary.
  • Long Definition: Poverty headcount ratio at $1.90 a day is the percentage of the population living on less than $1.90 a day at 2011 international prices. As a result of revisions in PPP exchange rates, poverty rates for individual countries cannot be compared with poverty rates reported in earlier editions.
  • Periodicity: Annual
  • Shortdefinition: Poverty headcount ratio at $1.90 a day is the percentage of the population living on less than $1.90 a day at 2011 international prices. As a result of revisions in PPP exchange rates, poverty rates for individual countries cannot be compared with poverty rates reported in earlier editions.
  • Statistical Concept and Methodology: International comparisons of poverty estimates entail both conceptual and practical problems. Countries have different definitions of poverty, and consistent comparisons across countries can be difficult. Local poverty lines tend to have higher purchasing power in rich countries, where more generous standards are used, than in poor countries. Since World Development Report 1990, the World Bank has aimed to apply a common standard in measuring extreme poverty, anchored to what poverty means in the world`s poorest countries. The welfare of people living in different countries can be measured on a common scale by adjusting for differences in the purchasing power of currencies. The commonly used $1 a day standard, measured in 1985 international prices and adjusted to local currency using purchasing power parities (PPPs), was chosen for World Development Report 1990 because it was typical of the poverty lines in low-income countries at the time. As differences in the cost of living across the world evolve, the international poverty line has to be periodically updated using new PPP price data to reflect these changes. The last change was in October 2015, when we adopted $1.90 as the international poverty line using the 2011 PPP. Prior to that, the 2008 update set the international poverty line at $1.25 using the 2005 PPP. Poverty measures based on international poverty lines attempt to hold the real value of the poverty line constant across countries, as is done when making comparisons over time. The $3.20 poverty line is derived from typical national poverty lines in countries classified as Lower Middle Income. The $5.50 poverty line is derived from typical national poverty lines in countries classified as Upper Middle Income. Early editions of World Development Indicators used PPPs from the Penn World Tables to convert values in local currency to equivalent purchasing power measured in U.S dollars. Later editions used 1993, 2005, and 2011 consumption PPP estimates produced by the World Bank. The current extreme poverty line is set at $1.90 a day in 2011 PPP terms, which represents the mean of the poverty lines found in 15 of the poorest countries ranked by per capita consumption. The new poverty line maintains the same standard for extreme poverty - the poverty line typical of the poorest countries in the world - but updates it using the latest information on the cost of living in developing countries. As a result of revisions in PPP exchange rates, poverty rates for individual countries cannot be compared with poverty rates reported in earlier editions. The statistics reported here are based on consumption data or, when unavailable, on income surveys. Analysis of some 20 countries for which income and consumption expenditure data were both available from the same surveys found income to yield a higher mean than consumption but also higher inequality. When poverty measures based on consumption and income were compared, the two effects roughly cancelled each other out: there was no significant statistical difference.
  • Topic: Poverty: Poverty rates
  • Unitofmeasure: %
  • All metadata

 

Bangladesh Review through World Bank

Bangladesh has made remarkable progress in reducing poverty, supported by sustained economic growth. Based on the international poverty line of $1.90 (using purchasing power parity exchange rate) a day, it reduced poverty from 44.2 percent in 1991 to 14.8 percent in 2016/17.

In parallel, life expectancy, literacy rates and per capita food production have increased significantly. Progress was underpinned by steady growth in GDP, which averaged 6.5 percent in the last decade (according to official estimates). Rapid growth enabled Bangladesh to reach the lower middle-income country status in 2015. In 2018, Bangladesh fulfilled all three eligibility criteria for graduation from the UN’s Least Developed Countries (LDC) list for the first time and is on track for graduation in 2024.

Sustained economic growth has rapidly increased the demand for energy, transport and urbanization. Insufficient planning and investment have resulted in increasingly severe infrastructure bottlenecks, congestion and pollution. To achieve its growth aspiration of becoming an upper-middle income country, the government urgently needs to ensure continuity of sound macroeconomic management, implement structural reforms, expand investments in human capital, increase female labor force participation, and raise productivity through increased global integration. Improving infrastructure as well as the business climate would allow new productive sectors to develop and generate quality self and wage employment.

Challenges

Bangladesh is both an inspiration and a challenge for policymakers and practitioners of development. While the income growth, human development and vulnerability reduction efforts to date have been extraordinary, Bangladesh faces daunting challenges with about 24 million people still living below the poverty line.

The country is at an important juncture, when with the right policies and timely action, it can move up within the middle-income bracket. The World Bank has identified job creation as the country’s top development priority.

Bangladesh needs to create more and better jobs to manage the problems related to rising youth unemployment and informal nature of the jobs. To do so, Bangladesh will need to remove the barriers to higher investment posed by low access to reliable and affordable power, poor transportation infrastructure, limited availability of serviced land, uncertain and complex business regulation, among others. Challenges related to rapid urbanization and climate change needs to get addressed through long-term planning.

Strategy

The World Bank has been a longstanding partner of Bangladesh since its independence. Since then, the World Bank through its concessional lending arm—the International Development Association (IDA)—has committed more than $30 billion in grants, interest-free and concessional financing credits to Bangladesh. In recent years, Bangladesh has been among one of the largest recipient countries of the IDA fund with the largest ongoing IDA program.

The World Bank has also been the largest external funder of Bangladesh providing over a quarter of all foreign aid to the country.

The World Bank has been supporting the government efforts in economic development and growth, power, infrastructure, disaster management, climate change, human and social development and poverty reduction.

COUNTRY PARTNERSHIP FRAMEWORK

The World Bank Group’s Country Partnership Framework (CPF) for Group’s Country Partnership Framework (CPF) for 2016-2020 supports Bangladesh to achieve its vision of reaching middle-income status by its 50th birthday in 2021. During the period, the World Bank Group’s technical and financial assistance focuses on (i) accelerating growth by helping to remove bottlenecks to growth and shift more financing to increase electricity supply and improve transport connectivity; (ii) foster social inclusion by building on Bangladesh’s impressive gains in human and social development; and (iii) strengthen climate and environmental management with the aim to enhance Bangladesh’s resilience to natural disasters, improving water and natural resource management and modernizing agriculture. The framework is anchored in the government’s seventh Five Year Plan which covers the same period.

Currently, the World Bank is engaging with stakeholders -- government, civil society, and the private sector -- for a mid-term review of the CPF.

THE WORLD BANK PROGRAM

Total IDA commitments as of today stands at $12.09 billion for 46 active projects. Bangladesh is currently the largest IDA borrower

Education

Bangladesh has made remarkable gains in ensuring access to basic and secondary education in the past two decades. In 2018, the country’s net enrollment rate at the primary school level reached above 97 percent, and that at secondary school level, around 62 percent.

With nearly 6.4 million girls in secondary schools in 2015, Bangladesh is among the few countries to achieve gender parity in school enrollment and has more girls than boys in secondary schools. Improving the quality of education remains the largest challenge for Bangladesh at all levels. However, around 18 percent of children ages 6-11 remain out of school – either having never enrolled or dropped out before completing grade 5. Socio-economic issues coupled with less women-friendly environment at the post-secondary level also marks slow gains in female labor force participation.

Due to high level of early drop outs in Bangladesh in previous years cumulative size of youth who are Not in Education, Earning or Training (NEET) with less than primary education is estimated at around 12 million at this moment, most of whom are women from rural areas. Bangladesh is actively aiming at providing non-formal education and basic skills development to support to this group including basic knowledge on hygiene practices, social coherence, road safety, economic opportunities and so on.

The World Bank is playing a role in training Bangladeshi youth for jobs through its skills, higher education and college financing projects. The country is gradually overcoming the issue of equitable access and quality at the post-secondary level with a combination of policy change and participation of the private sector. But more policy initiatives from the government and development partners would be critical for quality education access to all.

Government spending on education is only around two percent of the GDP, one of the lowest among countries at similar levels of development. IDA is the largest external funder in the education sector covering the primary, secondary, and tertiary levels, as well as technical and vocational education and training, and education for the hard-to-reach children.

Health, Nutrition and Population

Bangladesh has embraced the Sustainable Development Goals (SDGs), including SDG 3, encompassing universal health coverage. Progress on maternal and child health and nutrition, as well as fertility, has been better than would be expected given Bangladesh’s low level of public expenditure on health. While there is some evidence that improvements in maternal and infant mortality have slowed recently, reductions in child malnutrition have been faster than elsewhere, although on average one-third of children are stunted. Thus, there is a significant unfinished agenda for improving basic primary health, nutrition and population (HNP) services.

While many service utilization indicators, such as immunization coverage, have reached high levels, it is necessary to maintain those gains, achieve still higher coverage, improve quality, and reduce socio-economic and geographic inequalities.

At the same time, as it transitions to a middle-income economy, the country needs to address important financing, governance, and system management gaps for effective use of the necessary increased public spending on health. Bangladesh also faces emerging challenges arising from non-communicable diseases, urbanization and climate change as well as adolescent health.

The World Bank is supporting Bangladesh in aligning financing and technical support to meet these challenges. The Bank supports the government’s fourth HNP sector program for the period 2017-22, strengthening health system governance and management capacities, and delivery of  essential services, with a focus on the lagging regions of Sylhet and Chittagong Divisions. With financing from IDA, the Global Financing Facility (GFF), Sweden, the Netherlands, the United Kingdom, Canada, and Gavi, the Vaccine Alliance, the Health Sector Support Program contributes $700 million to the government’s program. The GFF is fostering collaboration between the HNP and education sectors to improve adolescent health and nutrition.

In addition, the World Bank is supporting the government to respond to the health needs of one million displaced Rohingya population in Cox’s Bazar District. With $50 million in grant funding (including IDA and financing from Canada), this component supports delivery of HNP services while developing the government’s capacity for coordination and management of the response.

Rural Infrastructure

IDA has been a major partner in the development of Bangladesh’s rural infrastructure, having funded three consecutive rural road improvement projects. By improving the livelihoods of rural women, around 820 km of Upazila and Union roads have been improved along with maintenance of almost 4,500 km rural roads in 26 districts, as well as dredging of 46 km of rural waterways.

Additional financing will also promote road safety engineering measures and community road safety campaign in project districts. All these activities have improved safer access to schools and health facilities, reduced transport costs, increased rural non-farm incomes, and generated employment in project areas, for both women and men.

Further, IDA support has helped build piped and non-piped water sources that provided safe and arsenic-free water to nearly 1.48 million beneficiaries. Water connections were created for 21,802 households, resulting in an estimated 98,109 people gaining access to safe water through new piped schemes. A total of 20,475 deep tube wells, rain water harvesting structures, pond sand filter and ring wells were constructed. In addition, 10,24,090 people received improved sanitation access from new latrines.

Energy

Bangladesh has made considerable headway in increasing access to electricity and power generation capacity. The access to electricity reached to 94% (grid and off-grid) and the current installed generation capacity has increased to 22,562 MW (including captive and renewable energy generation).  However, the sector is still facing challenges in ensuring reliable power supply mostly because of gas scarcity, inefficiency related to aged system and inadequate transmission and distribution networks. In the last decade, energy demand in Bangladesh has increased on an average of 10 percent per annum.

The World Bank has $2.4 billion of ongoing support in the energy sector to enhance capacity, generate clean energy, improve efficiency in generation and transmission & system operation, reduce technical losses, improve transmission and rural distribution network as well as increase access to both grid and renewable electricity. IDA support has so far added 2,652 MW electricity to the national grid, and 176 MW in off-grid areas through installation of solar home systems, solar irrigation pumps, solar mini-grids and installed more than one million improved cookstoves. Another 310 MW capacity will be added to the national grid through ongoing grid-tied solar projects.

Bank has also been engaged in promoting power sector policies and institutional capacity building within the Government, power and gas utilities and Bangladesh Energy Regulatory Commission (BERC) with the aim to improve the financial health, investment and service quality.

Agriculture

Despite high population density, decreasing arable land, and frequent natural disasters, Bangladesh has made remarkable progress in achieving food security and reducing poverty. While having one of the fastest rates of agriculture productivity growth in the world since 1995 (2.7 percent per year and second only to China), self-sufficiency is continuously threatened by a decrease of arable land by at least one percent per year, an increasing population, and declining output growth with the share of agriculture in total GDP decreasing from 28 percent in 1990 to just 13 percent in 2018. This has contributed to a decline in employment growth and to a slowdown in poverty reduction. The major challenges that contributed to the recent slowdown in agricultural growth include the lack of agricultural diversification, rice-focused agricultural policies, poor logistics and transportation, limited processing and commercialization, weak food safety and quality regulations, recurrent natural disasters and climate change negative effects.

The World Bank’s strategic framework in Bangladesh aims to support the GoB in its desired pivoting of the sector towards climate resilient diversification and value addition for greater job creation, entrepreneurship and resilient food systems.

The World Bank is helping over 1 million rural households modernize farm practices and use new climate smart technologies and 2 million household farmers, small and medium-scale agro-entrepreneurs to improve livestock and dairy production sustainably, with higher productivity and better market access. Simultaneously, the World Bank is supporting 500,000 households increase grain reserve to meet their post-disaster needs, and helping the country improve the quality and efficiency of grain storage management.

Climate Change

Bangladesh’s geographical position renders it especially vulnerable to the adverse impacts of climate change. The 2014 Climate Change Vulnerability Index ranks Bangladesh as the number one economy at risk to climate change. The vicious circle of natural disaster and poverty, whereby each new calamity risks poor becoming poorer and slows development, is a major challenge to poverty reduction efforts in Bangladesh.

The World Bank helped Bangladesh address climate change impacts and disaster risk management.  The country has built stronger disaster-coping mechanisms, and these have significantly reduced the impact of recent storms, cyclones, and floods in terms of numbers of deaths and economic losses.

IDA has an ongoing portfolio of $1.23 billion supporting Bangladesh to build resilience against natural disasters and climate change impacts. So far, 373 new cyclone shelters have been constructed; 666 km of embankment has been repaired; 17,500 hectares of  block plantations and 2,000 km of strip plantations have been completed in climate vulnerable areas; 40,000 people residing in saline, flood and drought prone areas have received adaptive basic needs (house, water, agriculture, health) and livelihood support; about 6,000 poor and forest dependent households in 200 communities have participated in the alternative livelihoods support programs.

Local Governance

Local government institutions in Bangladesh traditionally had a limited role in delivering services to their citizens due to limited responsibilities coupled with lack of adequate resources. Most government services have often been delivered in a top-down manner, with little accountability to local communities.  Over the past decade, the World Bank has been supporting the government’s move towards a stronger and more accountable local governance system.

Since 2006, IDA has been supporting a nationwide program that augments the government’s block grants provided to all 4,504 Union Parishads (the lowest tier of elected local government). The block grant enables Union Parishads to decide and spend on local priorities. Since 2006, the discretionary funds that a Union Parishad receives annually has grown by more than ten-fold and has benefitted 130 million people.

Hundreds of community schemes generating employment for the poor have been implemented, including construction or rehabilitation of rural roads, culverts, drainage and embankment systems; water and sanitation facilities; and schools and clinics. Thirty percent of the schemes are women-preferred schemes. Under the ongoing third project, IDA is assisting to institutionalize the block grants with the government’s own resources and supporting a pilot for an urban fiscal transfer system in 16 municipalities.

 

Ref: https://www.worldbank.org/en/country/bangladesh/overview

 

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