Egypt brings down poverty rates

 

Egypt brings down poverty rates

 

By Ahmed Kamel

 

That the national poverty rate is at a two-decade low must be a socioeconomic breakthrough.

Data from the state-run Central Agency for Public Mobilization and Statistics (CAPMAS) show that the poverty rate fell from 32.5 percent in fiscal year (FY) 2017-2018 to 29.7 percent in FY 2019/20. (Egypt’s fiscal year begins July 1.)

Similarly, absolute poverty (a condition where household income is below a necessary level to maintain basic living standards in terms of food, shelter and housing) was down from 6.2 percent to 4.5 percent from in the same period.

These findings reflect relentless government efforts to improve the living standards of average Egyptians and increase individual share in gross domestic product (GDP), which has been rising in recent years.

GDP rose from LE3.4 trillion ($216.6 billion) in FY 2016-2017 to LE5.2 trillion in FY 2018-2019. Despite the negative impacts of the Covid-19 pandemic, GDP grew to LE5.5 trillion in FY2019-2020), according to data from the cabinet’s media centre.

Since the launch of the economic reform program in November 2016, the government has been targeting improved quality of life for all.

With particular emphasis on job creation through public and private investments in all sectors, the government has ironed out obstacles to the business community through a raft of measures to create a market-friendly environment.

In 2013, unemployment was 14 percent. Now it is 7.3 percent.

Legislation covering the private sector and foreign investment has been overhauled.

However, narrowing income inequality will be one of the hardest nuts for the government to crack. Undoubtedly, a fair distribution of national income will come about only as a result of the empowerment of the middle classes and the poor through social protection plans and tax exemptions.

A long-term social protection program to combat poverty in the long term is essential, while mitigating the negative impact of world price shocks, notably crude oil and food commodities.

An efficient social protection network guaranteeing a sustained increase in real incomes must be applied.

Certainly, empowering the private sector and improving the business climate should be top priority issues, but only high investment can guarantee sustainable economic growth that creates jobs and increases incomes for all.