Poorest Countries in the World 2021

The world has enough wealth and resources to ensure that the entire human race enjoys a basic standard of living. Yet people in countries like Burundi, South Sudan and Somalia—the three poorest in the world—continue to live in desperate poverty.

How do we measure how poor or wealthy a given nation is compared to another? While GDP per capita is often considered the standard metric, by compensating for differences in living costs and rates of inflation, the purchasing power parity (PPP) can better assess an individual’s buying power in a particular country. 

It is hard to pinpoint a single cause of long-term poverty. Dictatorial and corrupt governments can make what could be a very rich nation into a poor one. And so does a history of exploitative colonization, weak rule of law, war and social unrest, severe climate conditions or hostile, aggressive neighbors. Hence why economists often refer to “cycles” of poverty. For example, a country in debt will not be able to afford good schools, and a poorly educated workforce will be less capable of fixing problems and creating conditions that will attract foreign investment.

Underprivileged households worldwide, it goes without saying, suffered the worst social and economic consequences of the coronavirus pandemic. Less than a year ago, the IMF warned: “The fraction of the world’s population living in extreme poverty—that is, on less than $1.90 a day—had fallen below 10% in recent years (from more than 35% in 1990). This progress is imperiled by the COVID-19 crisis, with more than 90% of emerging market and developing economies projected to register negative per capita income growth in 2020.” In countries with high shares of informal employment, lockdowns fueled joblessness and abrupt loss of income for many of those workers. Not only that, the IMF warned, school closures are expected to have disproportionately negative effects on the earnings prospects of millions of children.

Many of those predictions have already come true. “A way out of this health and economic crisis is now increasingly visible,” the IMF's chief economist and director of research, Gita Gopinath, wrote in the forewords to the April 2021’s World Economic Outlook update. However, due to stark differences in the pace of vaccine rollout and other factors, whereas several advanced economies will return to pre-Covid GDP levels in the coming months, too many emerging market and developing nations are not expected to do so until well into 2023. “The divergent recovery paths are likely to create significantly wider gaps in living standards between developing countries and others, compared to pre-pandemic expectations,” Gopinath warns. In the meantime, an additional 95 million people have entered the ranks of the extreme poor in 2020, and 80 million are today more undernourished than before. 

These reversals of gain in poverty reduction are especially visible in the world's 10 poorest countries. All of them are found in Africa, and in 2020 each one of them experienced a drop in the per-capita purchasing power compared to not just one or two years earlier, but in some cases even  decade. In these countries, on average, the individual share of the gross domestic output amounts to $1,125. By contrast, in the top 10 richest nations this figure is close to $78,600. 

Two of the countries in our list are within the Sahel region, where persistent and widespread droughts cause food shortages and associated medical and social problems. Six of them are landlocked, putting them at a considerable disadvantage relative to those with access to maritime trade. The decline in commodity prices in recent years has torpedoed their better chances for progress. All have experienced political instability, disputed elections, and ethnic or religious strife. And while all these countries have recorded fewer cases of coronavirus than most nations around the world, often there is no clear vaccination plan and the infection is still spreading. A large number of cases and deaths, sadly, will continue to go unreported.

Values are expressed in current international dollars, reflecting a single year's currency exchange rates and PPP adjustments. Data source: International Monetary Fund, World Economic Outlook Database, April 2021.

THE 10 POOREST COUNTRIESIN THE WORLD

10. Madagascar

Current International Dollars:  1,559 | Click To View GDP & Economic Data

Located 400 kilometers off the coast of East Africa, Madagascar is the fourth largest island in the world. Known for its astonishing wildlife, the flourishing tourism industry has not been able to lift the country out of poverty. The majority of the population is still dependent upon agriculture for their livelihoods, leaving the country’s economy especially vulnerable to weather-related disasters. Since becoming independent from France in 1960, Madagascar has experienced bouts of political instability, violent coups and disputed elections.

Yet, in recent years, Madagascar was finally on an upward trajectory. President Andry Rajoelina and his predecessor (and archrival) Hery Rajaonarimampianina had made poverty reduction and infrastructure development major priorities. Growth was increasing steadily, structural reforms were underway and foreign investors coming back.

Everything changed last year. Covid-19, the World Bank stated, has triggered a sharp recession, hitting especially hard the population employed in tourism and in the manufacturing sector. What’s worse, the outbreak also depleted the availability of fiscal resources for priority investments and social programs, putting on hold the goal of achieving more inclusive growth.

9. Liberia

Current International Dollars:  1,556 | Click To View GDP & Economic Data

Africa’s oldest republic has also ranked amongst the poorest nations for the longest time. While the country has enjoyed peace and stability since the ending of the civil war in 2003, its governments failed to adequately address serious systemic problems and structural challenges. To add to the difficulties, this country of about 5 million has greatly suffered from the decline in commodity prices and the major Ebola epidemic that hit West Africa in 2014.

Expectations were high when the former football star George Weah became president in 2018. His term was instead marred by high inflation and unemployment and negative economic growth. Although a moderate recovery is now projected, Covid-19 is bound to cast a long shadow on the nation’s prospects.

8. Mozambique

Current International Dollars:  1,276 | Click To View GDP & Economic Data

The former Portuguese colony has plenty of arable land and water, and ample energy and mineral resources. Mozambique is also strategically located, as four of the six countries it borders are landlocked and depend on it as a conduit to global trade, and over the past 10 years has often posted average GDP growth rates of more than 7%. Yet, it remains among the top 10 poorest countries in the world, with large sectors of the population continuing to live well below the poverty line. While a 15-year long civil war ended in 1992, severe climate conditions, corruption and political instability never went away. To make things worse, since 2017 attacks carried out by Islamic insurgent groups have plagued the gas-rich northern part of the country—over 4,000 people were killed and another 600,000 displaced.

When, in the summer of 2020, French company Total S.A. secured $15.8 billion in funding for a liquified natural gas facility in the region—the biggest foreign direct investment in Africa ever—many hoped the project would mark the start of a new beginning. However, in April 2021—after repeated setbacks due to the escalation of violent attacks in the area—the company announced that it would suspend its operations indefinitely.

7. Niger

Current International Dollars:  1,258 | Click To View GDP & Economic Data

With 80% of its landlocked territory covered by the Sahara Desert and a rapidly growing population largely dependent upon small-scale agriculture, Niger is under threat from desertification and climate change. Food insecurity is high, as are disease and mortality rates, and the army’s recurrent clashes with jihadist group and Islamic State (ISIS) affiliate Boko Haram have displaced thousands of people. One of the main drivers of the economy—the extraction of valuable natural resources such as gold and uranium—has also suffered from volatility and low commodity prices.

Nevertheless, the largest nation in West Africa seems to have finally entered a new political and economic transition phase. Wracked by military coups since its independence from France in 1960, in 2011 Niger declared veteran opposition leader Mahamadou Issoufou winner of the presidential polls. Since then, the adoption of a new investment code, improved access to credit and somewhat faster access to water have contributed to a sharp increase in foreign direct investment. When Issoufou stepped down this year after two five-year terms in office, despite an attempted (and thwarted) military coup, Niger inaugurated a new president—the teacher and former interior minister Mohamed Bazoum—in its first democratic power transfer. And while the country has reported a relatively low number of cases, last year its economy grew by just 1.2%. A rebound, however, is in the cards, and in 2021 the IMF expects its growth to be almost 7%.

6. Democratic Republic of the Congo (DRC)

Current International Dollars:  1,106 | Click To View GDP & Economic Data

Since gaining independence from Belgium in 1960, the Congo has suffered decades of rapacious dictatorship, political instability and constant violence. The country turned a page in 2019, when Félix Antoine Tshisekedi Tshilombo—the son of legendary opposition leader Etienne Tshisekedi—was elected as the new president.

The tasks he faces are daunting. His controversial predecessor Joseph Kabila—who had governed since succeeding his assassinated father in 2001—is credited for bringing an end to what is commonly referred to as the “Great African War,” a conflict that claimed up to 6 million lives, either as a direct result of fighting or because of disease and malnutrition. However, he did little to improve the lives of people who survived the war: over 60% of the country’s 92 million population still live on less than two dollars a day.

With 80 million hectares of arable land, over a thousand minerals and valuable metals under its surface and a citizen median age of just 17, the Democratic Republic of the Congo—the World Bank says—has the potential to become one of the richest African nations and a driver of growth for the entire continent. Political instability, endemic corruption and now the coronavirus pandemic continue to frustrate that potential. Adding to these factors, new cases of Ebola resurfaced in the northeast of the country last February, less than a year after another outbreak claimed the lives of more than two thousand people.

5. Malawi

Current International Dollars:  996 | Click To View GDP & Economic Data

One of Africa’s smallest nations, in recent years Malawi has made strides in improving economic growth and implementing crucial structural reforms. Nevertheless, poverty is still widespread, and the nation’s economy—largely dependent upon rain-fed crops—remains vulnerable to weather-related shocks. As a result, while living standards in urban areas are broadly improving, food insecurity in rural parts is extremely high.

Malawi is a generally peaceful country that has had stable governments since gaining independence from Britain in 1964. However, disputed poll results are far from being an anomaly. In 2020, the country's constitutional court annulled former president Peter Mutharika's poll win in the previous year’s general elections citing vote tampering. Theologian and politician Lazarus Chakwera, who was sworn in his place, declared that he wanted to provide the kind of leadership "that makes everybody prosper." The pandemic put that plan on hold: last year, the country’s GDP dropped to 0.6% from 4.5% a year earlier.

4. Central African Republic

Current International Dollars:  979 | Click To View GDP & Economic Data

Rich in gold, oil, uranium and diamonds, the Central African Republic is a very wealthy country inhabited by very poor people. However, after claiming the title of the poorest in the world for the best part of the decade, this nation of just 4.75 million is showing some signs of progress.

For the first time since its independence from France in 1960, in 2016 the Central African Republic has democratically elected a president: former mathematics professor and prime minister Faustin Archange Touadéra, who campaigned as a peacemaker who could bridge the divide between the Muslim minority and the Christian majority. Yet, while his successful election has been seen as an important step towards national reconstruction, large swaths of the country remain controlled by anti-government and militia groups. When, last December, Touadéra won a second term, rebel forces backed by the former dictator François Bozizé sought to retake control of the country.

Despite these problems and incidents, in recent years growth has somewhat picked up, driven by the timber industry and a revival of both agricultural and mining sectors. The economy is also benefitting from the partially resumed sale of diamonds, which were found to be funding inter-religious armed groups and placed under international embargo in 2013. Yet, the government has struggled to restore sales and has seen only a fraction of the revenues it once did, and roughly 70% of the population still live below the poverty line. To make matters worse, lockdowns and other measures taken by the government to limit the spread of the coronavirus forced many families to stay home, leaving them unable to earn an income.

3. Somalia

Current International Dollars:  924 | Click To View GDP & Economic Data

Three decades of internal violence and conflict, frequent droughts and floods followed by food insecurity and displacement of people, lack of access to health services coupled with the rapid spread of communicable diseases, massive levels of unemployment among especially young people —Somalis are growing hopeless.

This country of 16 million on the Horn of Africa never seems to catch a break. A projected GDP growth of over 3% in 2020 was interrupted by the compounded effect of the coronavirus pandemic, an infestation of locusts unprecedented in modern times and intensified floods, which caused the economy to contract by 1.5%. Yet, the World Bank says, Somalia could have a brighter future: “Rapid urbanization, growing use of digital technologies, planned investments in sectors such as energy, ports, education and health can support economic growth and job creation.” A tenuous recovery is already underway, and the government has pledged its commitment to charting a course toward better resilience and growth.

About that government: in April this year, Somalia’s parliament voted to extend president Mohamed Abdullahi Mohamed’s four-year term, which had expired two months earlier, for a further two years. The power grab triggered a political crisis and rival factions clashed in the capital Mogadishu. Ultimately, Mohamed bowed to the growing opposition and called for a new presidential election. Yet, experts say, there is still room for trouble.

2. South Sudan

Current International Dollars:  791 | Click To View GDP & Economic Data

South Sudan is the newest nation in the world. It was born on July 9, 2011, six years after the agreement that ended the conflict with Sudan, Africa's longest-running civil war. However, violence has continued to ravage this land-locked state of roughly 11 million. Formed by the 10 southern-most territories of Sudan and home to around 60 indigenous ethnic groups, a new conflict broke out in 2013 when president Salva Kiir accused his former deputy, rebel leader Riek Machar, of staging a coup. As a result, it is estimated that as many 400,000 people were killed in clashes and nearly 4 million have been internally displaced or fled to neighboring countries.

South Sudan could be a very rich nation, but with oil accounting for almost all of its exports, falling commodity prices and rising security-related costs hammered the country's economy. Outside the oil sector, the majority of the population is employed in traditional agriculture, although violence often prevents farmers from planting or harvesting crops.

Will the people of South Sudan ever have a real shot at living more prosperous lives? After signing a ceasefire and a power-sharing agreement in 2018, last year government and opposition parties formed a unity cabinet led by president Kiir and Machar as first vice president. The accord has proved fragile—yet, to a certain extent, it helped in reducing politically motivated conflicts. It has been less effective in countering the pandemic-related oil price shock and the effects of the most severe series of floods the country has experienced in 60 years—since last summer, they have killed livestock, destroyed crops and displaced thousands of families.

1. Burundi

Current International Dollars:  759 | Click To View GDP & Economic Data

The small landlocked country of Burundi, scarred by Hutu-Tutsi ethnic conflict and civil war, has the rather unenviable distinction of topping the world's poverty ranking. With about 90% of its nearly 12 million citizens relying on subsistence agriculture (and the overwhelming majority of them living on $1.25 a day or less) food scarcity is a major concern: the level of food insecurity is almost twice as high as the average for sub-Saharan African countries. Furthermore, access to water and sanitation remains very low, and less than 5% of the population has electricity. All these problems, needless to say, have been exacerbated by the pandemic.

How have things come to this, despite the civil war formally ending 15 years ago? Lack of infrastructure, endemic corruption, security concerns: the ingredients leading to extreme poverty are often the usual suspects. Pierre Nkurunziza, the charismatic former Hutu rebel turned president in 2005, had initially managed to unite the country behind him and to start rebuilding the economy. In 2015, however, the announcement that he would run for a third term—which according to the opposition was in violation of the constitution—reignited old disputes. A failed coup attempt followed, hundreds of people died in clashes and tens of thousands were displaced internally or abroad.

Just 55, Nkurunziza died last summer—officially for cardiac arrest, although it is widely suspected the real cause was Covid-19. Evariste Ndayishimiye, an ex-general who was handpicked by Nkurunziza to succeed him at the end of his mandate, was sworn days later. So far his record has been, to say the least, mixed. While, like his predecessor, he has downplayed the severity of the virus, he made an effort to relaunch the economy and repair diplomatic relationships with his African neighbors and, especially, the EU. Nkurunziza’s hope is that the bloc will resume financial aid to Burundi after the sanctions put in place following the 2015’s political crisis. Concerns regarding the persistence of human rights abuses perpetrated by the government against its citizens might get in the way of his wishes.

Gross domestic product (GDP) based on purchasing-power-parity (PPP) per capita.

Values are expressed in current international dollars, to the nearest whole dollar, reflecting a single year's currency exchange rates and PPP adjustments.​

Source: International Monetary Fund, World Economic Outlook April 2021.