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Lower-middle-income population at risk in 2022

Chilling Prospects 2022

Chapter 1.4

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In high-impact countries, the lower-middle-income population continued its growth in the 2022 analysis, increasing by 108.8 million, to 2.39 billion people. Conversely, the middle-income population declined substantially, by approximately 75.7 million from 1.38 billion in 2021 to 1.3 billion in the 2022 analysis.

Figure 1.12: Lower-middle-income population by country at medium risk due to a lack of access to cooling 

Approximately 2.39 billion people in high-impact countries represent an increasingly affluent lower-middle class that is on the brink of purchasing the most affordable air conditioner or refrigerator on the market. Limited purchasing choices available to this group favour cooling devices that are likely inefficient and could cause a dramatic increase in energy consumption and associated greenhouse gas (GHG) emissions.

The lower-middle income is the estimated segment of the population that lives outside of rural and urban poverty, though on less than USD 10.01 per day. In high-impact countries, the lower-middle income population continued its growth, increasing by 108.8 million people compared to last year, after an increase of 72.7 million people in 2020. Prior to the onset of the COVID-19 pandemic, a downward trend in the lower-middle-income population had been observed, matching the decline in the number of people living on low income. However, income loss during the pandemic, in combination with other factors, brought the lower-middle-income population back to similar levels as in 2018, when the tracking effort began. Among this group, it is estimated that an additional 165 million people globally lived on less that USD 5.50 per day due to the effects of the pandemic in 2021; of this number 82 million live in South Asia and 15 million in Sub-Saharan Africa. [1]

India, China and Indonesia represented the top three countries by absolute numbers, with India increasing its lower-middle-income population by approximately 45.2 million people, compared to 23 million and 3.8 million in China and Indonesia respectively. The largest relative increases in the lower-middle-income population compared to 2021 were observed in Papua New Guinea (19.2 percent), Iran (13.4 percent), and Sudan (9.6 percent). Compared to last year, Mozambique saw the largest reduction in its lower-middle-income population, of approximately 18.2 percent, reflecting an increase in the urban poor (and, to a lesser extent, the rural poor) population that offset a 1.5 percent increase in the lower-middle-income segment. 

Table 1.4: Top 10 countries with lower-middle-income population at risk (2020–2022, thousand)

Regionally, high-impact countries in Asia and the Middle East continue to be home to the majority of the lower-middle-income population among the high-impact countries for access to cooling, with consistent growth across high-impact countries in each region.

Figure 1.13: Lower-middle-income population regional breakdown (2018–2022)

In Africa, the 31 high-impact countries considered in the analysis represent approximately 15 percent of the global total for the lower-middle-income population, increasing from 358.3 million to 361.1 million in the 2022 analysis. In absolute terms, Egypt and Nigeria represent the largest populations, with Algeria (28.3 million), Morocco (20.9 million) and Sudan (33.5 million) representing additional countries in Africa with over 20 million among the lower-middle-income population. In the Congo (DR), Guinea-Bissau, Mozambique and Somalia, the lower-middle income population is below 3 percent in each, reflective of persistent barriers to higher incomes and the access to cooling that is likely to come with it. 

The high-impact countries in Asia and the Middle East include 81 percent of the global total for the lower-middle-income population, representing 1.94 billion people. The total lower-middle-income population in this region grew by almost 100 million compared to last year, and approximately 158 million people since 2020. The largest increases as a proportion of national populations are observed in Iran (13.4 percent), Sri Lanka, (9.6 percent), and Iraq (8.7 percent). All countries saw increases in their lower-middle-income populations, but the lowest observed increases occurred in Yemen (0.6 percent), Myanmar (1.2 percent) and Indonesia (2.2 percent). 

In high-impact countries in Latin America and the Caribbean, the lower-middle-income population represents 3.7 percent of the global total, increasing by 6.6 million, from 81.4 million last year to 88 million in the 2022 analysis. Brazil accounts for the majority of the increase in absolute terms, with approximately 5 million more people among this group in 2022 compared to last year, with the number in Argentina increasing by 400,000 people and the number in Peru increasing by 130,000 people. Notably, Paraguay’s lower-middle-income population decreased 3 percent compared to 2021.

Notes and references

[1] World Bank (2021) Poverty, median incomes, and inequality in 2021: a diverging recovery. Link.