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Literacy means the ability to read and write. Being able to read and write is an important skill in modern societies. Usually, people learn how to read and write at school. People who can read and write are called literate; those who cannot are called illiterate.
According to UNESCO, illiteracy is not being able to write or read a simple sentence in any language. They estimated that, in 1998, about 16% of the world's population were illiterate.