The World Bank projects the economic growth of poor nations to slow by almost one-third in the next seven years compared to the 2000 decade period.
In a development outlook released last week, the lender attributes the sluggish growth to recent crises among them the lingering economic consequences of Covid-19 and the global spillover effects of Russia’s war in Ukraine.
“These effects are being felt more acutely in the developing world, hurting sectoral performance hence growth for the remainder of this decade is projected to be one-third lower than it was in the 2000s,” World Bank says.
It says that further effects of these crises will throw tens of millions of people back into poverty, averting the 2030 Sustainable Development Goals of ending extreme poverty.
“The current rate of progress implies that nearly 600 million people will still be living on less than $2.15 (Sh291) a day in the coming seven years.”
Over the long term, the lender says the picture is equally bleak as shocks from Covid-19, Russia-Ukraine war and the prevailing financial constraints could hurt essential sectors, stalling growth.
For instance, Covid-related education shocks could cost today’s students in low and middle-income countries up to 10 per cent of their future earnings.
The projection reflects IMF’s recent growth prospects projection for the Sub-Saharan African countries which mostly are under the developing category.
It projected the region’s growth to decline to 3.6 per cent this year, making the second consecutive year that the region records a lower rate of growth than the previous year where it grew by 4.7 per cent.
However, this is before rebounding to 4.2 per cent in 2024 in line with the anticipated global recovery, subsiding inflation and a winding down in monetary policy tightening.
IMF attributed the slower projection to the general global slowdown, as activities are expected to decelerate for a second year in a row.
Kenya’s growth prospects was downgraded to a slow of 5.3 per cent, down from the previous two years' projections of 5.4 per cent in 2022 and 7.5 per cent in 2021.
