(5 minutes read)
· The World Bank has classified Mauritius as a High Income country while Tanzania and Benin are now considered Lower-middle income countries.
· Factors such as economic growth, inflation, exchange rates, and population growth will have bearing on the GNI per capita. Revisions to national accounts methods and data can also influence GNI per capita
The World Bank has classified Mauritius as a High Income country while Tanzania and Benin are now considered Lower-middle income countries. These are positive developments for the continent, which is perceived to be a group of poor countries.
Despite the gloom that persists on account of the increasing spread of Covid-19, the countries that moved up in value chain are in a celebration mood. Tanzania’s President John Pombe Magufuli while sharing the news through the social media, highlighted that his country reached the new position five years earlier than expected. Tanzania was looking at achieving that feat only by 2025. The President said that the milestone was crossed with strong determination and hard work of yjr country men.
The World Bank data indicates that Tanzania’s Gross National Income (GNI) per capita as of July 1, 2020 is US $1,080 up from $1,020 in 2019, whereas Benin’s GNI per capita is US$1,250. The GNI of Mauritius is now at US$12,740. The GNI per capita is the dollar value of a country’s income in a year divided by its population.
Factors such as economic growth, inflation, exchange rates, and population growth will have bearing on the GNI per capita. Revisions to national accounts methods and data can also influence GNI per capita. It may be noted that the national accounts revisions have played a significant role in the upward revision for Benin, Nauru and Tanzania.
Two countries -Sudan and Algeria – however had their fortunes reversed as they were moved to lower categories. Sudan which was classified as a lower-middle income country in 2019 has now pushed back to the category of a low income country. Algeria has also gone down from upper-middle income to lower-middle income.
For Sudan, because of the revisions in exchange rates, the GNI series for 2009-2018 has been recast. The 2018 GNI per capita figure has been revised down to US$840 from the previously published figure of US$1,560, according to the World Bank. Countries like Algeria, Indonesia, Mauritius, Nepal, Sri Lanka and Romania were very close to
the respective thresholds last year. There is a caveat from the Bank that the data used does not reflect the impact of the ongoing coronavirus pandemic
