Doaa Abdel Latif-Cairo

Poverty rates in Egypt have risen in an unprecedented way in recent years, despite the government's promotion by officials of improved growth figures, amid fears of possible repercussions.

The choking crisis called on the Center for Solutions for Alternative Policies at the American University in Cairo to organize a seminar to discuss the causes of the increase in the number of poor people with solutions to face the phenomenon.

Under the title "New Poverty Figures in Egypt: Why are the Poverty Increasing?", Economists presented their scientific vision with an analysis of poverty figures released by government agencies.

A third of Egypt's population is poor, according to economists

very poor
A third of Egyptians are poor and cannot afford their basic needs, such as food, drink and medicine.

According to CAPMAS, the poverty rate rose to 32.5%, the highest since 2000.

Al-Laithi said that the poor are concentrated in the southern governorates (Upper Egypt), where they constitute 40% of the total poor.

The spokeswoman revealed figures for the poor in Egypt, pointing out that poverty rates in urban areas increased by 11.6% and in rural areas 4.7%, while the poverty rate in rural Upper Egypt dropped to 52% in 2017 compared to 56.7% in 2015.

She pointed out that Assiut is the largest governorate with a poor rate of 66%, pointing out that 236 villages from Sohag Governorate fall within the poorest thousand villages in Egypt, meaning that 87% of the villages fall below the poverty line.

The Reasons of Poverty

The consultant of the Central Agency for Mobilization and Statistics said that the causes of poverty in the villages are different, pointing out that there are villages where the quality of agricultural land is low, and others have higher dropout rates.

There are several reasons for the high rates of poverty, including lack of transparency and accountability, large disparities in living standards between different regions, declining real consumption, low public spending on education and health, high cost of living, with the inability to create jobs, and recourse to inappropriate work. As well as low cash assistance.

She said that the period between 2015 and 2018 witnessed a significant increase in the rise in prices of goods and services due to the liberalization of the exchange rate until the dollar rate approached 18 Egyptian pounds, while incomes remained constant and not commensurate with prices.

She stressed that high growth rates are a necessary condition for reducing poverty, but it is not enough, pointing out the importance of not achieving development at the expense of depleting resources and not preserving the physical assets to ensure the right of future generations.

Getting out of the current crisis involves working on more than one axis, Laithi said, but singled out the interdependence between government and private institutions and civil society, listening to the complaints of the poor, and developing policies to deal with overpopulation.

Alia Mahdi: We warned before the January revolution of poverty in urban governorates (Al Jazeera)

Crisis and actions

For her part, the former dean of the Faculty of Economics and Political Science at Cairo University, Alia Mahdi, read in the results of the Egyptian family budget for 2018.

Al-Mahdi said that the Egyptian state faced an economic problem represented in the deficit of the public budget, a deficit in the balance of payments, and the fluctuation of the currency exchange rate.

That problem prompted the government to take a package of measures that led to higher prices, including the liberalization of the exchange rate and interest rate and the lifting of subsidies on fuel and electricity, according to Alia.

She stressed that the government measures were supposed to work to reduce inflation, but what happened is the jump in inflation to high rates, expressing surprise at the announced figures on the decline in unemployment rates, while the labor force shrinks and the number of workers does not rise.

She added that the state has tried to reduce poverty through expanding social housing, developing and rationing ration cards and supporting poor families through social programs. "But these programs target 2 million families out of about 30 million poor families."

The former dean of the Faculty of Economics and Political Science said that the surveys showed an increase in the rate of spending of Egyptian families on food and drink by 37% in 2017 compared to 33% in 2015, as well as spending on housing and accessories such as electricity increased from 17.5% to 18.6%.

She pointed out that the average income of the family rose from 44 thousand pounds per year in 2015 to 59 thousand pounds in 2018.``The figures look good, but considering the high prices, the average income dropped to 36 thousand pounds compared to prices. ''

Warning of revolution

Alia Mahdi warned of the high rates of poverty in the provinces of civilization, such as Cairo and the face of sea, pointing out that anger is rising in such areas and then revolutions because they are more educated, describing them as time bombs.

"Before the January 25 revolution, we were warning of the high level of dissatisfaction in urban governorates."

Mahdi proposed an economic plan to address high poverty, including encouraging investment, and there should be policies to implement projects in the educational, agricultural and industrial sectors, in addition to attention to micro, small and medium enterprises.

She stressed the need to pay attention to the development of education so that it is completely free, and the development of a system of full health insurance, pointing out that education and health deplete the Egyptian family budget a lot.

She concluded by referring to the need for an economic conference in which all minds of different orientations and ideologies meet to develop practical solutions to the challenges faced by the government.