When the mammoth proportions of the global pandemic became clear, something else became clear to those of us who spend our days thinking about and fighting global poverty. It was clear that this crisis would not hit everyone equally. The extreme poor, whose lives are precarious in the best of times, would be hit immediately and in devastating ways.
A new report from King’s College London puts numbers to these fears. Like so much else with this crisis, it is even worse than we originally imagined. The report analyzes the impact on extreme poverty of global economic contractions at three levels. In the best-case scenario, a 5% contraction, the researchers anticipate that 87 million people would fall into extreme poverty – half of them in South Asia where Upaya works. That is the best-case scenario. In the worst-case scenario, a 20% contraction, half a billion people could fall into extreme poverty, erasing the gains of the past 30 years. That kind of retreat is almost too horrifying to think of.
But this is not the stuff of academic papers. Journalists are already covering the news of migrant day laborers in India, Kenya, and the Philippines who say that they fear starvation much more than they fear this virus. We know that people are already starving on roads as they try to make their way back to home villages following the lockdown in India. There is urgent need for relief now, as Sachi wrote in her earlier blog post.
Some of our partner and accelerator companies are leading the way in providing direct relief to their jobholders while they wait for the economy to open up again. Upaya cheers these efforts and encourages our supporters to consider this kind of direct support as well.
Just as there is urgent need for relief today, we need to be thinking about recovery just as urgently. No one can accurately predict the way this crisis will unfold. We can, however, predict massive disruption at least in the short term and probably the medium-term. In the middle of this disruption, however, people still need to earn a living and buy food and educate their children. We are still receiving business plans and talking with entrepreneurs who have clever ideas that are creating jobs even now. We hope to invest in new companies by the end of this quarter that can return some of the wages that have been lost to this crisis.
Like all good economic reports, the report from King’s College London forecasts numbers based on a set of assumptions. They assume that there is no intervention on behalf of the poor or developing countries. We have the power to change these assumptions and change the trajectory of the impact. Upaya is focused on creating long-term opportunity for the recovery phase, but we encourage our supporters to also help out during this relief phase through the campaigns being run by our trusted portfolio partners and accelerator entrepreneurs.
Thank you for helping us change the trajectory.
