The Impact of Unequal Wealth Distribution on Poverty Worldwide

September 29, 2019

While it is often said that more people were pulled out of poverty over the last century than in the whole history of mankind, there is still much work to do. Some numbers about Africa’s economy can seem encouraging at the surface level, but the harsh reality is that Africa still has some of the most unequal societies in the world. It is a continent still affected by political conflicts and corrupt governments. Let’s take a look at some of the effects of unequal wealth distribution worldwide, and what the prospects look like for the future.

Poverty in Africa is Decreasing, But Not Fast Enough

While some countries have had a renaissance, such as Rwanda or the Côte d’Ivoire, poverty on the continent remains very real, and out of the world’s poorest countries, 24 out of the 30 were located in sub-Saharan Africa.

One obstruction seems to be the huge gap between the immense wealth of a small group of persons and the rest of the population. Then there’s the specter of military conflict and rebel activity, often fueled by shadowy groups and old colonial powers.

Countries such as the Democratic Republic of Congo, where most of the world’s cobalt is produced, have been torn apart by conflict for decades. While the high demand for cobalt should have been a windfall for the impoverished country, a handful of warlords in highly disputed regions are the only ones benefiting from it, not to mention that political tensions are never good for foreign investment.

Africa is Not the Only Continent to Suffer from Poverty

South America, Central Asia, and various parts of Eastern Europe are also suffering from extreme poverty and inequality. As we can see on this map, the average income in countries like Afghanistan is below the $600 mark. This can be attributed to decades of conflict, the lack of infrastructure, and a lack of natural resources. The yearly income in Ukraine is also shockingly low at about $2,660, though the gap between the highest and lowest annual incomes is not as drastic there as it might be in other countries—a vestige of the old communist era.

What Are the Solutions?

The solution to the problem should eventually come from different parties. A long-term solution to poverty would be for foreign aid to focus on helping countries become more self-sufficient, through self-determination and development opportunities.

Infrastructure will also have to be improved, starting with roads and communications. Wireless has been a huge boon to Africa, and more people than ever have had the chance to get connected. This is in large part what has contributed to the sudden growth. Finally, leadership in these countries will have to be either pushed or forced to redistribute wealth and uphold the rule of law, either through sanctions or direct action. However, this approach could also lead to more inequality, as governments will often end up funding rebels who will then become the new financially elite, perpetuating the same cycle over and over again. One example would be Ortega in El Salvador.

The problem of poverty is a complex one. Aid efforts that give the impoverished increased access to education, financial mobility, more stable governance and better infrastructure should be given more attention. Much work still needs to be done, but there is still hope.

About the Author: William is a climate/weather enthusiast who takes a great interest in topics related to both climate change and weather. He graduated with a degree in chemistry from the University of Dallas. He is currently retired and lives with his family in Dallas, TX.

*This is an independent article and does not reflect the views of WHES.