LATAM | Poverty Outlook

Poverty in LATAM represents a complex and diverse challenge. On average, monetary poverty affects 37% of the population in Argentina, Colombia, Mexico, and Peru. A Multidimensional Poverty Index constructed for these countries identifies key deprivations linked to health coverage, economic dependency, and education.

Key points

• Key points:
• The latest official data available places Mexico with the highest monetary poverty rate at 44% (2022), followed by Argentina at 42% (2023Q2), Colombia at 33% (2023), and Peru at 29% (2023).
• For the countries in the study, monetary poverty is more prevalent in rural areas, among the population aged 0 to 14, individuals with low educational attainment, non-wage earners, and those employed in the informal sector.
• A Multidimensional Poverty Index (MPI) is proposed using a uniform methodology, with consistent indicators and variables across the analyzed countries. The findings indicate that Mexico has the highest Multidimensional Poverty Index, followed by Peru, Colombia, and Argentina.
• Health coverage, high economic dependency within households, and educational lags are the variables that contribute the most to the constructed MPI.
• The intersection of monetary and multidimensional poverty indicators enables the identification of the vulnerable population—households not currently classified as monetarily poor but experiencing multidimensional poverty.

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