1

About ADB

ADB is owned by 67 members, including 48

from the region. ADBs vision is an Asia and

Pacific region free of poverty.

2

52

53

54

55

56

DMCs Regional

members

Population share, 2013

0

10

20

30

40

DMCs Regional

members

Income share, 2013

Asia

Rest

of

world

Share in extreme

poor, 2010

Key Indicators

for Asia and the Pacific

ADBs flagship publication on statistics

(economic, financial, and social indicators)

45th edition, covers 48 regional members

Includes a special chapter on Poverty in Asia:

A Deeper Look

3

4

Asias dramatic poverty reduction

0

10

20

30

40

50

60

70

80

90

1981 1984 1987 1990 1993 1996 1999 2002 2005 2008 2010

Poverty rate (%)

Central and West Asia East Asia

Pacific South Asia

Southeast Asia Developing Asia

Number of

poor

(millions)

1981 2010

Central and

West Asia 67 25

East Asia 835 156

Pacific 2 3

South Asia 495 473

Southeast Asia 189 77

Developing

Asia 1587 733

5

Objectives of the report

Examine reasons for inadequacy of the

conventional poverty line (PL)

Provide analytical inputs to ongoing

discussions of identifying extreme poor

Three reasons for inadequacy of the $1.25 PL

Consumption basket not specific to Asias poor

Vulnerability to shocks not factored in

Food prices rise faster than general price level

New count of extreme poor

7

Food is more costly in Asia

8

Source: ICP 2005.

0 200 400 600 800 1000

0

.

0

0

0

0

.

0

0

2

0

.

0

0

4

0

.

0

0

6

0

.

0

0

8

D

e

n

s

i

t

y

0 200 400 600 800 1000

0

.

0

0

0

0

.

0

0

2

0

.

0

0

4

0

.

0

0

6

0

.

0

0

8

D

e

n

s

i

t

y

Africa

Asia

Annual food expenditures per capita in 2005 PPP for the 15 least

developed countries

D

e

n

s

i

t

y

An Asian poverty line

Apply method used to derive $1.25 PL, but

with updated national poverty lines from Asia

Asian poverty line = $1.51/day (in 2005

PPPs)

9

implies higher poverty rates

Poverty rates (%) in Asia ($1.51 vs. benchmark $1.25 poverty lines)

Number of poor (millions) in Asia under

the $1.25 and $1.51 poverty lines

10

26.9

23.920.7

37.334.0

30.5

5

10

15

20

25

30

35

40

2005 2008 2010

P

o

v

e

r

t

y

r

a

t

e

(

%

)

Benchmark Adjusted

902 828 733

350348

343

0

200

400

600

800

1000

1200

1400

2005 2008 2010

N

o

.

p

o

o

r

(

m

i

l

l

i

o

n

s

)

Poor between $1.25 and $1.51

$1.25 poor

1,1761,076

1,252

(at $1.25) (at $1.51)

Source: ADB estimates. Top number = the poor at $1.51

poverty line

11.6

32.7

18.116.5

47.7

28.0

0

10

20

30

40

50

60

PRC India Indonesia

Benchmark (at $1.25) Adjusted (at $1.51)

Country-specific data

Poverty rates (%), 2010, ($1.51 vs. benchmark $1.25 poverty lines)

11.6

32.7

18.1

16.5

47.7

28.0

0

10

20

30

40

50

60

PRC India Indonesia

P

o

v

e

r

t

y

r

a

t

e

(

%

)

Number of poor (millions), 2010, under the $1.25 and $1.51 poverty lines

156

400

43

65

184

240

100

200

300

400

500

600

700

PRC India Indonesia

N

u

m

b

e

r

o

f

p

o

o

r

(

m

i

l

l

i

o

n

s

)

221

584

67

11

Top number = the poor at $1.51 PL

Vulnerability to shocks affect welfare

$1.25 PL does not consider risks or shocks

Vulnerability-adjusted PL can be derived

12

FLOOD EARTHQUAKE

STORMS

Greater frequency of natural calamities

0

10

20

30

40

50

60

70

80

1980 1985 1990 1995 2000 2005 2010 2013

F

r

e

q

u

e

n

c

y

o

f

n

a

t

u

r

a

l

c

a

l

a

m

i

t

i

e

s

Drought Earthquake Epidemic Flood Landslide

Storm Volcano Wildfire Tsunami

13

Sources: EM-DAT: The OFDA/CRED International Disaster Database, at www.emdat.be, Universit catholique de

Louvain. Brussels, Belgium; ADB Photo Library.

affect millions of Asians

0

50

100

150

200

250

1980 1985 1990 1995 2000 2005 2010 2013

N

o

.

o

f

a

f

f

e

c

t

e

d

p

o

p

u

l

a

t

i

o

n

(

m

i

l

l

i

o

n

)

The Pacific Southeast Asia

South Asia East Asia

Developed Member Economies Central and West Asia

14

Source: EM-DAT: The OFDA/CRED International Disaster Database, at www.emdat.be, Universit catholique de

Louvain. Brussels, Belgium.

Shocks raise poverty measures too

Poverty rates (%) in Asia, with vulnerability considered

Number of poor (millions) in Asia, with vulnerability considered

15

26.9

23.9

20.7

37.3 35.3

32.6

10

15

20

25

30

35

40

2005 2008 2010

P

o

v

e

r

t

y

r

a

t

e

(

%

)

Benchmark Adjusted(at $1.25) for vulnerability

902 828 733

348 395418

0

200

400

600

800

1000

1200

1400

2005 2008 2010

N

o

.

o

f

p

o

o

r

(

m

i

l

l

i

o

n

s

)

$1.25 poor Additional

1,250 1,2231,151

Top number = total poor

Source: ADB estimates.

11.6

32.7

18.116.5

47.7

28.0

0

10

20

30

40

50

60

PRC India Indonesia

Benchmark (at $1.25) Adjusted for vulnerability

Country-specific data

Poverty rates (%), 2010, with vulnerability considered

11.6

32.7

18.1

28.7

41.6

27.1

0

5

10

15

20

25

30

35

40

45

PRC India Indonesia

P

o

v

e

r

t

y

r

a

t

e

(

%

)

Number of poor (millions), 2010, with vulnerability considered

156

400

43

229

110

220

100

200

300

400

500

600

PRC India Indonesia

N

u

m

b

e

r

o

f

p

o

o

r

(

m

i

l

l

i

o

n

s

)

384

510

65

16

Top number = total poor

Faster food price hikes affect poor more

Food insecurity often

reflected in rising food

prices

Adjust $1.25 PL by

food CPIs when higher

than general CPIs

17

Food price vs. general price increases

2000 2002 2004 2006 2008 2010 2012

0

.

8

1

.

0

1

.

2

1

.

4

1

.

6

1

.

8

Bangladesh

P

r

i

c

e

I

n

d

e

x

u

s

i

n

g

2

0

0

5

a

s

B

e

n

c

h

m

a

r

k

CPI

Food CPI

2000 2002 2004 2006 2008 2010 2012

0

.

8

1

.

0

1

.

2

1

.

4

1

.

6

1

.

8

India

CPIFood CPI

2000 2002 2004 2006 2008 2010 2012

0

.

6

0

.

8

1

.

0

1

.

2

1

.

4

1

.

6

1

.

8

2

.

0

Indonesia

CPI

Food CPI

2000 2002 2004 2006 2008 2010 2012

0

.

8

1

.

0

1

.

2

1

.

4

1

.

6

1

.

8

2

.

0

Nepal

CPI

Food CPI

2000 2002 2004 2006 2008 2010 2012

1

.

0

1

.

2

1

.

4

1

.

6

Peoples Republic of China

CPI

Food CPI

2005 2006 2007 2008 2009 2010 2011 2012

1

.

0

1

.

2

1

.

4

1

.

6

1

.

8

2

.

0

2

.

2

Tajikistan

CPI

Food CPI

Bangladesh China, Peoples Rep. of India

Tajikistan Indonesia Nepal

Source: FAO18

Poverty adjusted for faster food price hikes

Poverty rates (%) in Asia, with faster food price increases considered

Number of poor (millions) in Asia, with

faster food price increases considered

19

26.9

23.9

20.7

27.5

24.7

15

20

25

30

2005 2008 2010

P

o

v

e

r

t

y

r

a

t

e

(

%

)

Benchmark Adjusted(at $1.25) for food price hikes

902 828733

124141

0

200

400

600

800

1000

2005 2008 2010

N

o

.

o

f

p

o

o

r

(

m

i

l

l

i

o

n

s

)

$1.25 poor Additional

952874

Top number = total poorSource: ADB estimates.

11.6

32.7

18.116.5

47.7

28.0

0

10

20

30

40

50

60

PRC India Indonesia

Benchmark (at $1.25) Adjusted for vulnerability

Country-specific data

Poverty rates (%), 2010, with faster food price hikes considered

11.6

32.7

18.1

17.0

33.8

28.0

0

5

10

15

20

25

30

35

40

PRC India Indonesia

P

o

v

e

r

t

y

r

a

t

e

(

%

)

Number of poor (millions), 2010, with faster food price hikes considered

156

400

43

71

14

24

0

50

100

150

200

250

300

350

400

450

PRC India Indonesia

N

u

m

b

e

r

o

f

p

o

o

r

(

m

i

l

l

i

o

n

s

)

227

414

67

20

Top number = total poor

26.9 23.9 20.7

10.410.1

9.8

11.4 17.619.1

0

10

20

30

40

50

60

2005 2008 2010

P

o

v

e

r

t

y

r

a

t

e

(

%

)

$1.25 $1.51 - $1.25 Food price increases + Vulnerability

Combining all 3 factors doubles Asias poor

Poverty rates (%), all 3 factors considered

26.9 23.9 20.7

10.410.1

9.8

11.4 17.619.1

0

10

20

30

40

50

60

2005 2008 2010

P

o

v

e

r

t

y

r

a

t

e

(

%

)

48.7 51.5 49.5

Number of poor (millions), all 3 factors considered

902 828 733

350348

343

382 608 674

0

500

1000

1500

2000

2005 2008 2010

N

o

.

o

f

p

o

o

r

(

m

i

l

l

i

o

n

s

)

1,634

1,784 1,750

21

Source: ADB estimates.

26.9 23.9 20.7

10.410.1

9.8

11.4 17.619.1

0

10

20

30

40

50

60

2005 2008 2010

P

o

v

e

r

t

y

r

a

t

e

(

%

)

$1.25 $1.51 - $1.25 Food price increases + Vulnerability

Poverty reduction remains a challenge

Poverty rates (%), all 3 factors considered

12.75.8

2.5 1.4

8.7

5.9

2.71.1

19.8

20.0

19.0

14.6

0

5

10

15

20

25

30

35

40

45

2015 2020 2025 2030

P

o

v

e

r

t

y

r

a

t

e

(

%

)

41.2

31.7

24.2

17.1

Number of poor (millions), all 3 factors considered

473223 100 56

324

230

10947

734

777

764

605

0

200

400

600

800

1000

1200

1400

1600

1800

2015 2020 2025 2030

N

o

.

o

f

p

o

o

r

(

m

i

l

l

i

o

n

s

)

1,532

1,230

973

708

22

Source: ADB estimates.

Policy implications: food price increases

Availability

Affordability

Supply stability

23

Policy implications: vulnerability

Disaster risk reduction

Climate change mitigation and adaptation

Diversification of income sources

Social assistance and protection

Market-based instruments (e.g., disaster

insurance, health insurance, crop insurance)

24

Key messages

Taking into account these factors, the

headcount of extremely poor is substantially

higher than by conventional measures

Addressing vulnerability and food affordability

and reliability are important parts of anti-

poverty strategies

25