Egypt recently saw for the first time over the past twenty years a decrease in its poverty rates, which the analysts have attributed to the success of the economic reform program and the accompanying social protection policies.
According to the country’s official statistics agency’s report on December 3, Egypt’s poverty rate declined to 29.7 percent in the 2019-2020 fiscal year, down from 32.5 percent two years earlier.
This is the first time Egypt has seen a decrease in its poverty rate since 1999.
“This is an unprecedented victory,” Salah Hashim, advisor for the Ministry of Social Solidarity for Political Policies, told Xinhua.
The report was conducted by the Central Agency for Public Mobilization and Statistics (CAPMAS) based on poverty, consumption, and income research.
Prior to 2018, the CAPMAS has been compiled this research every five years. The research now is being conducted every two years upon instructions of Egypt’s President Abdel Fattah al-Sisi for measuring the government performance standards, said Hashim.
He deemed the decrease as “an evidence of the success of the economic reform program that the government has implemented in cooperation with the International Monetary Fund.”
Egypt has adopted by the end of 2016 an economic reform program that included the liberation of the local currency, gradual lift of subsidy on fuel and electricity, as well as endorsement of a package of economic legislations.
The government launched social policies and initiatives like “Honorable Life” that directly improved the citizens’ daily life in terms of houses’ quality, sanitation and health services, Hashim added.
He pointed out that the social policies have lifted more than 1,000 villages from the line of extreme poverty over the past four years.
In February 2016, the government launched a national agenda called “Egypt Vision 2030” that reflects the state’s long-term strategic plan to achieve sustainable development principles and objectives in all areas including economic, social, and environmental dimensions.
“Egypt Vision 2030 has focused on promoting social justice, not only helping the poor and low-income people like before,” Hashim explained, noting that the government aims to fight poverty at the financial, educational, health and cultural levels through various national initiatives.
He also referred to the “100 Million Healthy Lives” campaign for the treatment and early detection of people with hepatitis C virus (HCV) and non-communicable diseases (NCDs) as a “turning point” in Egypt’s healthcare system.
Those initiatives, covering the free diagnose and medication, have highly eased the burdens on the Egyptian families that spend 20 percent of their income on treatment and health care.
“Now they could redirect the money to other important sectors,” he added.
The expert reiterated that the government also provides conditional cash support through the solidarity program (Takaful and Karama), from which 3.6 million families benefit, equivalent to 14.6 million citizens, in addition to security pensions from which about 9 million citizens benefit.
Hashim said that the pensions have seen a large leap recently and improved the living conditions of the old people and lift them out of the poverty category.
Waleed Gab-Allah, professor of economic jurisdictions with Cairo University, agrees that the government’s social solidarity programs have mitigated the pressures facing the neediest citizens.
He pointed out that getting out of poverty is mainly related to improving the macroeconomic indicators, such as increasing the rate of growth and reducing rates of inflation and unemployment, and that’s the reason Egypt firmly adopted economic reform plan.
Gab-Allah stressed that the economic reform program at the beginning has shocked the citizens when the inflation has exceeded 30 percent which led to the depletion of their income and the increase of the poverty rates.
However, the economic reform started to bring its fruits with a reduction of the inflation to less than 4 percent currently, increase in the wages which were all reflected in improving the real income of the Egyptian families.