World bank raises poverty line to $3

The World Bank has revised upwards the international poverty line for low-income countries, including Malawi, from $2.15 (about K3 764) to $3 (about K5 253) per person per day.

The upward revision, according to economists, pushes Malawi’s poverty headcount from 72 percent to about 80 percent, making Malawians poorer than before.

In its June 2025 Update to Global Poverty Lines, the Bretton Woods institution said the revision reflects changes in prices across the world and also better data on the costs of basic food, clothing and shelter needs in low-income countries.

“As differences in price levels across the world evolve, the World Bank’s poverty lines are periodically updated to reflect these changes,” reads a World Bank update.

In a written response yesterday, Centre for Social Concern economic governance officer Agnes Nyirongo said with about 80 percent of the population now living under the poverty line, the revised poverty threshiold reflects the deepening crisis in Malawi’s economic performance.

She said: “What this means in real terms is that millions of Malawians are earning less than K5 000 per day at a time the cost of even a simple meal has doubled or tripled.

“This widening gap between income and living costs is pushing families into desperate coping strategies, pulling children out of school, skipping meals or engaging in unsafe and exploitative work just to survive.”

Economics Association of Malawi president Bertha Bangara-Chikadza said in an interview on Sunday that the revised poverty line highlights the scale of the country’s challenges.

She said: “It has to be noted that Malawi’s national poverty line based on local costs of basic needs remain unchanged, but the revised global lines highlight a starker gap between Malawi’s economic reality and international benchmarks.

“This has implications on Malawi’s long-term vision, which aims to transform the country into a wealthy, self-reliant and upper-middle-income economy by 2063.”

Economist and independent presidential aspirant Milward Tobias said the revision means prices of goods that constitute a basket to determine the poverty line have increased.

“Increase in prices over time is normal economic phenomenon, but what is a concern is when the price of commodities increase at a time people’s incomes are either constant or declining and when the increase in commodity prices is skyrocketing.

“For Malawi, this revision of poverty line means more people now than before are below the poverty line for the reason that as we all know incomes have declined.”

On his part, Scotland-based Malawian economist Velli Nyirongo said in an interview on Sunday that this means that many Malawians who were previously classified as living above the poverty line may now be considered poor despite no real change in their actual income.

He said this casts a sharper light on the scale of Malawi’s economic vulnerability and the uphill task it faces in realising the goals outlined in MW2063.

World Bank data shows that Malawi’s gross domestic product (GDP) per capita stands at $602.3 (about K1 million) as of 2023, far below that of the lower middle-income economy of $1 146 (about K2 million) and higher income economies of $14 005 (about K25 million).

With this GDP per capita, Malawi has a poverty rate of 70.1 percent, but going by the higher income GDP per capital standing, the poverty rate in Malawi would be at 97.3 percent, according to the World Bank.

National Planning Commission acting director general Joseph Nagoli, whose organisation offers oversight role of MW2063, said the change in poverty line does not affect the country’s graduation to a middle income country status.

The international poverty line was last updated in 2022.

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