Modeling the macroeconomic and climate determinants of poverty in Somalia

Poverty remains a critical global issue, marked by limited access to essentials like food, clean water, healthcare, education, and adequate living conditions. In Africa, poverty is particularly severe due to conflict, political instability, weak institutions, and reliance on subsistence farming. Somalia experiences some of the highest poverty rates worldwide, worsened by prolonged conflict, droughts, poor infrastructure, and unstable governance. Consequently, many Somalis depend on humanitarian aid and informal livelihoods. Despite these challenges, there is a significant gap in empirical research on the macroeconomic and climate determinants of poverty in Somalia using advanced econometric techniques. Therefore, this study examines the impact of macroeconomic and climate change determinants on poverty, employing the Augmented ARDL model to capture both long-run and short-run relationships from 1991–2020. The results show that inflation, population growth, and temperature increase poverty, while rainfall helps reduce it. The exchange rate and economic growth show an insignificant effect. Based on the findings, policymakers should prioritize inflation control, manage population growth effectively, invest in climate-resilient agriculture and adaptation strategies, maintain macroeconomic stability, and promote inclusive economic growth to effectively reduce poverty.