Homeless people receive food at Sao Martinho de Lima Community Center in Sao Paulo, Brazil, on May 30, 2022. A new report released by the UN Development Programme warned that 71 million people in the world's poorest countries are in extreme poverty because of the global cost-of-living crisis.
Achim Steiner, UNDP administrator, said that the surge in key commodity prices this year was already slamming parts of Sub-Saharan Africa, the Balkans, Asia and elsewhere.
The UNDP called for tailored action. It wanted to give direct cash handouts to the most vulnerable and wanted richer nations to expand and widen the Debt Service Suspension Initiative they set up to help poor countries during the COVID-19 epidemic.
Steiner said that the cost-of-living crisis is tipping millions of people into poverty and even starving at a breathtaking speed. The threat of increased social unrest grows by the day. Institutions like the UN, the World Bank and the International Monetary Fund have a number of poverty lines - one for the poorest countries where people live on $1.90 or less a day. A $3.20 a day line for lower middle-income economies and a $5.50 a-day line in upper middle-income countries are in place.
The report said that the cost-of-living crisis may have pushed 51 million more people into extreme poverty at $1.90 a day and an additional 20 million at $3.20 a day, which would push the total globally to just over 1.7 billion people.
It added that targeted cash transfers by governments would be more equitable and cost-effective than blanket subsidies on things like energy and food prices that richer parts of society tend to benefit more from.
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In the long term, they drive inequality, exacerbate the climate crisis, and do not soften the immediate blow, the UNDP head of strategic policy engagement, George Gray Molina, said.
The last two years of the flu have shown that these cash-strapped countries need support from the global community to fund these schemes.
Molina said that they could extend the G 20-managed Debt Service Suspension Initiative by two more years and expand it to at least 85 countries from a currently-eligible 73.