Government officials consistently underestimate the level of poverty and unemployment in Egypt, writes Ahmed El-Sayed El-Naggar Poverty is internationally set at a level of income of less than $2 a day. Abject poverty is set at an income of less than $1 a day. People living on such low levels of income are often unable to scrape together the most basic necessities, let alone participate in social and political life. Poverty is, therefore, a social as well as an economic phenomenon. Lack of income is combined with a reduced sense of dignity, belonging and equality. According to the Minister of Planning poverty is being reduced in Egypt. This is an optimistic assessment to say the least. World Bank figures published in 2005 indicate that in 2000 almost 3.1 per cent of the population (that is around two million people) lived on $1 a day or less and that 43.9 per cent (or 28 million people) lived on $2 a day or less. According to a survey conducted in 1999 and 2000, the poorest 10 per cent of the population made 3.7 per cent of the country's income. The poorest 20 per cent made 8.6 per cent of the income. The second poorest 20 per cent made 12.1 per cent of the income. The third poorest 20 per cent made 15.4 per cent of the income. The second richest 20 per cent of the population made 20.4 per cent of the income. The richest 20 per cent of the population made 43.6 per cent of the income. And the richest 10 per cent made 29.5 per cent of the country's total income. The picture looks bleak when you compare such figures with World Bank statistics for 1998-99. There is little doubt that poverty in Egypt increased throughout the 1990s. In 1991 the poorest 10 per cent of the population made 3.9 per cent of the country's income. The poorest 20 per cent of the population made 8.7 per cent of the income. The third poorest 20 per cent of the population made 16.3 per cent of the income. The second richest 20 per cent of the population made 21.4 per cent of the income. The richest 20 per cent of the population made 41.1 per cent of the income. And the richest 10 per cent made 26.7 per cent of the country's income. World Bank reports are silent on corruption and black market racketeering in Egypt. They say nothing of drug trafficking and smuggling, which is where much of the big money is made. Who are the poorest citizens in Egypt? Workers are poor, as are landless peasants. Low ranking government officials live close to the poverty line unless they have means -- legal or illegal -- of augmenting their salaries. The unemployed are poor, even though some work in the informal sector. This is the underclass of society. These are the people who live in the randomly built areas around our towns. And at the first sign of social upheaval they can turn into a destructive force. Egypt has an underclass that is economically deprived and politically disorganised. Similar classes in Paris have revolted of late, though their conditions must be better in comparison. The marginalised classes are not an accident of nature. They are victims of specific policies. Poverty is the result of an economic and social system that is unfair and dysfunctional. Poverty gets worse when governments are controlled by big business and wages are kept low. Government salaries in this country have fallen to a level that is precariously close to the poverty line. Unemployment is widespread, and so is corruption. Education and health services have deteriorated. We have failed to revive small businesses in the countryside and in poor urban neighbourhoods. This is why poverty is getting worse. According to official figures, unemployment was 9.9 per cent in 2003/04 and 10.6 in 2005. Compare this with the case at the beginning of the last century when unemployment was as low as three per cent, and then with unofficial figures which speak of 30 per cent unemployment. The official figures for unemployment do not include people who live of inheritance or savings. The official definition of unemployment is wrong. Anyone who is seeking work but cannot find a job at the current wage rate should be considered unemployed. According to official figures, the country's workforce was 20.7 million in mid-2004. According to World Bank figures, unemployment was 26.7 million in 2003. The government appears to be underestimating the workforce in order to deflate the unemployment figure which could be as high as 30 per cent. The Central Authority for Public Mobilisation and Statistics (CAPMAS) says 99 per cent of the unemployed are aged between 15 and 40. Almost 88 per cent of the unemployed are aged between 15 and 30. Most of the unemployed, surprisingly enough, are educated. If anything this is clear waste of both education and labour. Unemployment is an economic as well as a political problem. The unemployed are more susceptible to extremism and criminal violence than others. And in a country that has no decent system of social welfare the unemployed have to depend on families for survival, and the pressure this places on the family often leads to violence within the home. Poverty is an outcome of unemployment. To alleviate poverty we need more jobs. We need to stimulate savings and investment rather than consumption. We need to encourage labour- intensive activities. We need to encourage small businesses where the cost of creating a job is 20 times lower than in major investment projects and to do that we have to alter our banking policies. Banks should treat small enterprises more favourably in terms of payment schemes, grace periods and interest rates. Perhaps we should even think of creating a national incubator for small businesses, an agency that offers them effective assistance. We also need to fight corruption and nepotism, and to do that we have to have a democratic system capable of holding the government strictly to account. Nepotism deprives the underprivileged from access to jobs that they deserve and undermines the efficiency of our economy. We need to make the creation of jobs our top priority.
