How do Nigeria and Saudi Arabia compare for poverty and unemployment?

After Nigerian president Muhammadu Buhari controversially compared oil prices in Nigeria and Saudi Arabia as justification for repeated petrol price hikes since June 2020, some people in Nigeria have taken to social media with other comparisons between the two countries.

A well-shared message posted on Facebook on 1 October makes a number of economic comparisons, to highlight why there might be “justification for fuel to be cheaper in Nigeria than Saudi Arabia”.

It says that while Saudi Arabia’s 2019 unemployment rate was only 5.9%, “at least 80% of Nigerians are unemployed”.

It also claims that “Nigeria has the largest extreme poverty population in the world” while there “is no Saudi citizen that is poor going by the strict definition of poverty by World Bank”.

But are its claims about poverty and unemployment rates in the two countries supported by facts? We checked.

Unemployment claims incorrect

Saudi Arabia’s unemployment rate was close to 5.9% in 2019, but according to official labour force datareleased by the country’s General Authority for Statistics, it never rose above its 5.7% peak in the first and fourth quarters of 2019. At its lowest point, in the third quarter, it was 5.5%.

Nigeria’s unemployment rates are far lower than “at least 80%”. The country’s National Bureau of Statistics(NBS) recorded an unemployment rate of 27.1% in the second quarter of 2020, during the Covid-19 pandemic. The last time this data was collected, in the third quarter of 2018, the unemployment rate was 23.1%.

Except even this is misleading. The NBS includes in its definition of unemployment those who “did absolutely nothing at all or did something but for less than 20 hours” in the week before being surveyed. (For more on how the NBS calculates unemployment, read our factsheet on the classification system from its introduction in 2015).

In contrast, Saudi Arabia uses a definition of unemployment that only counts people who did absolutely nothing in the week before the survey. This is much closer to the standards set by International Labour Organisation, or ILO, whose definition of employment includes anyone who worked at least one hour during the reference period before the survey – in this case, a week).

To be “unemployed” under this definition, a person would have to work less than one hour each week. The NBS accounts for this, saying in its 2020 second quarter report: “Using the international definition of unemployment, the rate was computed to be 11.7%.”

The ILO itself considers Nigeria’s unemployment rateto be roughly 8.3% (in 2019) and Saudi Arabia’s as just over 6.0% (in 2018).

Africa Check has investigated claims about Nigeria’s unemployment rate in the past, and has seen no evidence that it is as high as 80%. Even the country’semployment to population ratio, which considers how many Nigerians are employed as a proportion of its total population – not just its labour force – is only 50.23% according to the ILO. Saudi Arabia’s is 52.48%.

The Facebook message is inaccurate about unemployment. But what about poverty?

Poverty claims also inaccurate

The World Bank, which is cited in the Facebook post, defines extreme poverty as living on less than the equivalent purchasing power of $1.90 in 2011 US dollars. There have been some suggestions that this is not a useful measure of poverty, so the World Bank tracks other poverty indicators as well, but this remains its benchmark for “extreme poverty”.

The Facebook post is correct to claim that, according to this metric, “nearly 50%” of Nigeria’s population lives in extreme poverty. In fact, according to the World Bank, Nigeria’s poverty rate in 2009 (when data was last gathered) was 53.5%

But this does not give Nigeria “the largest extreme poverty population in the world”. In its 2018 Poverty and Shared Prosperity report, the World Bank said: “India, with over 170 million poor people in 2015, has the highest number of poor people and accounts for nearly a quarter of global poverty.”

The top five countries as listed in that report were India, Nigeria, the Democratic Republic of the Congo, Ethiopia and Bangladesh. Compared against one another here, the most recent data available for each puts India far ahead of the others, with 268.7 million people in poverty, compared to Nigeria’s second place of 84.7 million.

Even when considering a more useful metric such as poverty rates (the number of people in poverty as a share of the total population), Nigeria is only second among these five countries, as the Democratic Republic of the Congo has a poverty rate of roughly 76.6%.

The World Bank has no data on poverty in Saudi Arabia. This does not mean, as the post claims, that “no Saudi citizen that is poor going by the strict definition of poverty by World Bank”. The World Bank may lack the data, but this does not mean there is no poverty in Saudi Arabia.

A 2017 report on Saudi Arabia from the UN High Commission Human Rights Office says “there has not yet been any systematic mapping of poverty or any detailed analysis of its characteristics” in the country.

A 2018 World Bank report on Saudi Arabia warns: “While no official information is available, the Kingdom likely faces a looming poverty problem.” It cites “inadequate access to economic opportunities” and changing economic activities.

So, while it might be possible that no Saudi citizens meet the World Bank definition of poverty, there is no data to indicate this.

Some of the claims in this Facebook post are true, but its comparisons between the poverty and unemployment rates in Nigeria and Saudi Arabia are mostly inaccurate. – Keegan Leech

Source: africacheck.org