The World Bank has issued a stark warning over the economic deterioration in 39 conflict-affected and fragile states, revealing that more than 420 million people are now living below the poverty line in these regions.
The findings, published in the Bank’s first comprehensive study of fragile economies since the onset of the COVID-19 pandemic, outline a grim trajectory for some of the world's most vulnerable populations.
According to Ayhan Kose, Deputy Chief Economist at the World Bank, “Recession—not growth—has become the norm in economies plagued by conflict and instability.”
The report covers countries stretching from the Marshall Islands in the Pacific to Mozambique in sub-Saharan Africa, showing that these nations have experienced a 1.8% annual decline in per capita economic output since 2020. In contrast, other developing countries recorded a 2.9% annual increase in GDP over the same period, according to data cited from the Associated Press.
Poverty and Human Development Gaps Widen
The study underscores staggering development disparities. Although the populations of fragile and conflict-affected countries make up less than 15% of the global total, nearly one in two people living under $3 per day reside in these nations.
Infrastructure decay, weak governance, and limited educational attainment are among the core challenges. On average, residents receive only six years of education, three years less than their counterparts in other low- and middle-income countries. Life expectancy is five years shorter, and infant mortality is twice as high.
Active Conflicts and Their Economic Fallout
Of the 39 countries analyzed, 21 are experiencing active conflicts, including Ukraine, Sudan, Ethiopia, and Gaza. The World Bank estimates that in nations suffering from high-intensity conflict—defined as over 150 deaths per million people annually—GDP drops by an average of 20% within five years of conflict onset.
The humanitarian cost is equally severe. The report states that 18% of people in these fragile countries—around 200 million individuals—face acute food insecurity, compared to just 1% in other developing nations.
A Glimmer of Progress
Despite the overall grim outlook, the report highlights a few “relative success stories.” Countries like Nepal, Bosnia and Herzegovina, Rwanda, and Sri Lanka have managed to escape the spiral of fragility and post-conflict economic stagnation. “These are examples that show progress is possible, even under extremely difficult circumstances,” said Kose.
As global conflicts grow in frequency and intensity, the World Bank warns that without targeted investment and coordinated international support, many fragile states risk falling into prolonged economic paralysis—leaving hundreds of millions trapped in poverty and instability.
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