STORY HIGHLIGHTS

MORONI, June 18, 2018 – Situated in the Indian Ocean, to the north-west of Mayotte and Madagascar, the archipelago of the Comoros has registered a 10-percentage point reduction in poverty levels since 2014, according to the latest poverty assessment report on the Comoros, published by the World Bank.

The study notes that while there has been a drop in poverty levels in both rural and urban areas, the reduction has been significantly more apparent in the urban area. It draws six main conclusions:

• Poverty is relatively widespread throughout the country, although the level is rather low in comparison to the countries of Sub-Saharan Africa: In 2014, 42.4% of the population, or approximately 316,000 people were living below the poverty line of 25,341 Comorian francs per person per month. The poverty line is based on the cost of meeting basic needs.  Around 23.5% of the population lives in conditions of extreme poverty.  However, judging by the international poverty threshold of $1.9 per person per day, only two out of every ten Comorians could be classified as poor, a rate that places the Comoros ahead of other low-income countries and 30 percentage points ahead of other countries in Sub-Saharan Africa.
• Inequality is still quite widespread: Consumption expenditure is very unequally distributed in the Comoros, with the most obvious disparities being observed in the rural areas and in Ndzouani.  The disparity between rural and urban households is largely attributable to the fact that rural households earn less from their income streams.  The characteristic features of poor households contribute in large measure to persistent poverty and intergenerational inequality.  Approximately one fifth of all instances of unequal levels of consumption can be attributed to the inequality of opportunity associated with the circumstances observed within Comorian households.
• Some positive developments may be observed with regard to the intergenerational labor mobility: young men and women are increasingly choosing to work in sectors that are more productive than those of their parents.  Consequently, living standards and household revenue have improved, mainly due to higher levels of education and greater access to means of communication and transport.  Higher earnings from jobs in the sectors of industry and commerce have contributed to a further reduction in poverty levels.
• Living conditions and multidimensional poverty indices have improved, but many people remain without access to services and goods: Between 2004 and 2014, households benefited from improvements in housing conditions and the supply of modern equipment.  Multidimensional poverty has fallen considerably as living conditions have improved.  The percentage of the population experiencing hardship, as measured in approximately one third of the indicators of well-being such as consumption, access to goods and basic services and housing conditions, has fallen from 85% in 2004 to 75% in 2014.  Despite these improvements, the population continues to suffer from serious hardship in a number of indicators of well-being, particularly in rural areas.  The most notable indicators of well-being that reflect the hardship being experienced by the population include access to goods and basic services, followed by consumption.
• It appears that development policies in the Comoros have helped improve living conditions and human development in the country and reduce poverty: The national strategy for the promotion of education and for the enhancement of social expenditure on education and health has led to real progress in the development of human capital and helped prevent the deepening of inequalities.
• The increasingly significant levels of support provided by the diaspora through the transfer of remittances to their families and to the economy as a whole have no doubt made a critical contribution to the improvement of household living standards and to poverty reduction.  The Comoros has one of the largest diasporas in Africa and is one of the three main beneficiaries of remittances in Sub-Saharan Africa.  Remittances account for around 25% of GDP and the foreign exchange inflows from these transfers exceed those derived from exports.  Remittance flows have also increased considerably over the past few years, both in absolute terms and as a percentage of GDP.  Nevertheless, the sustainability of this trend remains uncertain.

The report includes some strategic advice on accelerating economic growth and reducing poverty in the Comoros and provides recommendations on how to take advantage of the attributes of the Comoros and leverage the country’s latent comparative advantages to create more productive employment, promote diversification, competitiveness and formality, and improve the framework for exploiting the gains from migration and remittance transfers.