Poverty rates are highest in the eastern and northern regions at 42% and 40% respectively, according to a report released by the World Bank yesterday.
These rates differed significantly from those in the western region (27 percent) and central region (15 percent), and exceeded the national average of 30 percent, according to the report.
While some regions have improved more than others, none have yet reached the government’s target of reducing the poverty rate to 14 percent by 2020. This raises questions about the effectiveness of past interventions that have cost the government billions of shillings.
World Bank economists attribute high levels of poverty in the eastern and northern regions to limited access to infrastructure such as electricity, erratic rainfall (drought), low levels of education and small markets. I think there is.
According to the World Bank, the report is based on data from three Ugandan National Household Surveys, three Uganda Panel Surveys, seven Uganda Radio Frequency Telephone Surveys, the Uganda Refugee Radio Frequency Telephone Survey and Afrobarometer data.
The report details poverty trends in the country from fiscal year 2012/2013 to 2019/20, the year of the COVID-19 outbreak. This shows that national poverty rates fluctuated from 31 per cent in 2012/2013 to 32 per cent in 2016/2017 before declining to 30 per cent in 2019/2020.
Aziz Atamanov, senior economist at the World Bank, said in the release of the report that the Ugandan people have been hit by multiple shocks over the past decade, including weather shocks (droughts), COVID-19, Ebola, and the war in Ukraine. said it turned out.
“The shock distribution shows that the poorest people in rural areas were most affected, because they had no savings and had to adopt harmful coping strategies, such as reducing food consumption. ” said Atamanov.
Economists also said the results were unattractive given how the country was coping with these multiple shocks.
“While non-agricultural employment has increased, we have found that the poorest people who need the jobs the most cannot easily access those jobs,” Atamanov said.
World Bank economists also focused on agriculture, which employs the majority of the population. “We found that production processes were largely affected by the weather and there was no fundamental change in the production process, which means that any future shock could increase poverty,” Atamanov warned.
Mukami Kariuki, Country Manager of Uganda at the World Bank, said up to 50 percent of the population was vulnerable to the above shocks and could fall into “poverty in the next two years.”
Bank of Uganda Deputy Governor Dr. Michael Atingi Ego, who attended the launch ceremony, said the country should focus on financial inclusion to reduce its vulnerability to shocks.
“There is a need to expand financial service delivery channels to rural areas, promote the penetration of digital financial services, and increase the number of formal financial account holders,” he said.
The deputy governor said the government should also focus on introducing modern agricultural methods such as irrigation to improve production, processing, added value and exports.
There were also clear differences in poverty rates among the sub-regions. The Kampala subregion had the lowest poverty rate at just 4 percent, 20 times lower than the Karamoja subregion (70 percent) and Acholi subregion (72 percent), according to the report.
“In contrast, a combination of higher population density, better access to infrastructure and markets, and a higher human capital index appear to contribute to the economic development of the subregion when measured by nighttime lighting (NTL).” writes the authors.
Atamanov suggested that the government needs to find ways to move people to urban services, as agriculture has low growth potential.
However, this does not mean that everyone should leave farming, he said, as those who can adopt (expensive) modern farming methods will be able to continue.
But Sheila Kawamala Mishambi, executive director of the East Africa Subregional Initiative to Empower Women, said Ugandans have a competitive advantage in agriculture. The government should invest more in agriculture to increase productivity and added value, she said.
Kawamala also questioned the use of consumption levels as one measure of poverty, saying it does not paint a clear picture as some people spend less because they are saving rather than because they are poor. , said.
She also questioned World Bank data on savings, saying many Ugandans save in the form of pet goats and cows, not necessarily in banks.