The impact of COVID-19 on consumption poverty in Mozambique.

ABSTRACT

This study assesses the impact of COVID-19 on household consumption poverty. To predict changes in income and the associated effects on poverty, we rely on existing estimated macroeconomic impacts. We assume two main impact channels direct income/wage and employment losses. Our simulations suggest that consumption decreased by 7.1%-14.4% and that poverty increased by 4.3-9.9 percentage points in 2020. This points to a reversal of the positive poverty reduction trend observed in previous years. Poverty most certainly increased in the pre-COVID period due to other shocks, so Mozambique finds itself in a deepening struggle against poverty.