Wednesday, July 21, 2010

Poverty Rate Unchanged In Iraq

The United Nations Trust Fund and the Iraqi Planning Ministry recently issued a report that found that poverty in Iraq had remained constant in the last couple years. In the latest survey 22.9% of the population, roughly 7 million people, were found to be living in poverty. That was unchanged from a 2008 survey on the topic by the government’s Central Organization for Statistics and Information Technology that covered 2006-2007. The poverty level was set at 77,000 dinars per capita, or $67 per month.  39.3% of the poor lived in rural areas, compared to 16.1% in urban ones.

The United Nations found that those most likely to fall into poverty were households that did not work in the public sector. The U.N. reported that the average per capita income for a home with one government worker and no other employees was 14% higher than a family with just one member in the non-public sector. The International Monetary Fund (IMF) claimed that 30% of households got their income from government jobs in 2006-2007. Another 15% earned their money from government pensions.

The IMF also said that while poverty was widespread in Iraq, it was also shallow. Many Iraqis are vulnerable to fall into poverty, but the gap between the average income in the country and the poverty level was very small. That meant a small increase in income could lift many out of danger.

Iraq’s 2010 budget is attempting to address the problem, but it’s unlikely to work. The government wants to increase personal income, provide jobs, and housing for the poor this fiscal year. They plan to achieve that by attracting private investment, increasing trade, oil sales, and promoting the private sector. By doing that they hope to reduce poverty to 14% by 2014. The only part of that plan that’s likely to happen is boosting oil production and exports as Baghdad has signed several new contracts with international energy companies. As for the rest, Iraq’s laws and business environment currently discourage investment, and the government has no real plans on how they’re going to make the business sector grow in the country. A member of the Justice Ministry also told the press that officials were siphoning money off from the anti-poverty campaign. As with almost everything in the country, corruption is always a threat to undermine progress in Iraq.

There is good news and bad news about Iraq’s poverty rate. First, it has not increased for the past several years. On the other hand, it does not look to improve either as the government’s anti-poverty campaign is bound to fail. That will mean nearly a quarter of Iraq’s population will continue to live off of $2 a day, with little hope to improve their lot. Until the government can function better and private business increases in Iraq there will probably be no relief for these millions of people.

SOURCES

AK News, “Corruption led to poverty in Iraq,” 3/28/10
- “Iraq fights poverty with new plan,” 4/10/10

Aswat al-Iraq, “COSIT: Unemployment, poverty drop in Iraq,” 12/13/09
- “Poverty in Iraq in 2007 at 23% - COSIT,” 5/19/09

Inter-Agency Information and Analysis Unit, “Iraq Labour Force Analysis 2003-2008,” United Nations Office for the Coordination of Humanitarian Affairs, January 2009

International Monetary Fund, “Staff Report for the 2009 Article IV Consultation and Request for Stand-By Arrangement,” 2/16/10

IRIN, “IRAQ: Over 20 percent of Iraqis live below the poverty line,” 5/24/09

Radio Nawa, “United Nations: Iraq will be a “demographic gift” This year,” 7/12/10

2 comments:

Don Cox said...

Is there a micro-loans movement in Iraq? Micro loans seem to work well in many countries for lifting people out of poverty.

It would be necessary to find a form of words that made such loans "Islamic".

Joel Wing said...

Don from what I've read credit is almost unknown in Iraq. Banks are mostly used for savings by average Iraqis, and banks are afraid to make loans because of the instability in the country. The closest thing to micro loans was run by the US military under the Commanders Emergency Response Program which gave out small amounts of money to local projects. That's obviously winding down with the US withdrawal.

Renewed Civil Disobedience As Govt Misses Protest Deadline For Reforms

(AP) The Iraqi government’s failure to meet a deadline set by the protest movement to carry out reforms such as holding new elections h...