Publication: Poverty in Egypt 2008-09 : Withstanding the Global Economic Crisis
Date
2011-06-11
ISSN
Published
2011-06-11
Author(s)
World Bank
Abstract
The original aim of this poverty
analysis, prepared in collaboration with Egypt's
Ministry of Economic Development, was to help inform the
country's development strategy and guide World Bank
assistance in support of that strategy over the coming
years. This objective remains nevertheless valid, although
the timeframe for addressing some of the most critical
issues, such as the high rate of extreme poverty,
vulnerability, and food insecurity may now be accelerated.
The authors believe that the analysis presented in this
note, while being based on data that precede the actual
onset of the current political crisis, reveals deep tensions
in the society that are linked to the high level of
vulnerability and the lack of an efficient and flexible
social assistance system. This report assesses the poverty
and welfare changes in Egypt between 2008 and 2009 and
presents a comprehensive picture of the evolution of poverty
between 2004/05 and 2008/09. Poverty in Egypt decreased
between 2005 and 20082, due in large part to rapid economic
growth, although high inflation during this period had
detrimental effects on the extreme poor. Yet, the sudden
economic slowdown in the context of accelerating inflation
in 2008/2009 reversed the gains in poverty reduction
achieved during the period of rapid growth. The increase in
poverty closely followed the accelerating inflation during
2008 causing vulnerable groups to be particularly affected
by the economic turbulence. Despite these setbacks, some of
the gains from the rapid growth between 2005 and 2008 were
sustained over the crisis period. Policies aimed at helping
households withstand the effects of the crisis were however
not sufficient to prevent an increase in poverty. The crisis
exposed underlying vulnerabilities in Egypt s social
protection system. Finally, the adverse effects of food
price shocks on the real incomes of Egypt s poor point to
the need for further analytical work on labor markets, in
particular wage policy, as part of the social risk
management framework.
Citation
“World Bank. 2011. Poverty in Egypt 2008-09 : Withstanding the Global Economic Crisis. © Washington, DC. http://openknowledge.worldbank.org/entities/publication/e26d2678-1a87-5d03-8707-7c3c9e0ae6a2 License: CC BY 3.0 IGO.”