Poverty

The Arab region witnessed an improvement in its Human Development Index (HDI)[1], an index which combines three dimensions of human development, namely health, education and living standards, from 0.613 in 2000 to 0.703 in 2018. In fact, this overall gain hides regional variations; while the HDI reached a value of 0.865 in the United Arab Emirates, it registered a low of 0.463 in conflict-hit Yemen.[2] Nonetheless, following the COVID-19 crisis, Human development is facing an unprecedented hit in 2020 since its inception in 1990, a setback is projected for the HDI index value: a decrease by 0.02.[3]

 

Despite this positive overall trend in human development, poverty remained one of the paramount challenges for several countries in the region, accompanied with political and economic circumstances that led to a regression in economic growth, unstable social conditions and striking differences in living standards.[4][5] According to the latest statistics by UN-ESCWA, around 101.4 million people in the region can be currently classified as poor, and 52 million as undernourished.[6]

 

Poverty rates have particularly soared in countries of conflict. Conflict has brought Yemen to the verge of famine. While around half of the Yemeni population were considered poor before the crisis, 78.5 percent of the Yemeni population lived on less than US$3.20 in 2017. In addition, in 2019 over 20 million Yemenis suffered from food insecurity, 7.4 million were at risk of famine and 3.3 million children were malnourished.[7][8] In Syria, around 11.7 million people were considered in need of humanitarian assistance in 2019, in the world’s second worst humanitarian crisis after Yemen. According to the latest UN Humanitarian Needs Overview, more than 83 percent of Syrians live below the poverty line, compared to 28 percent in 2010.[8][9] High income inequality rates have also persisted within and across countries. GINI coefficients are very high in countries such as Lebanon and Egypt, reaching 66 percent and 54 percent respectively (according to the latest available data).[10]

 

Due to limited data coverage and measurement challenges linked to the irregularity of conducting national household surveys, obtaining an average of “poverty headcount ratio at USD 1.90 a day” for the region is difficult to attain.[11] That said, there is also a dearth of updated statistics on incidences of poverty, as measured by national poverty lines.

 

The outbreak of COVID-19 and the resulting lockdown will have a deeper impact on the poor and more vulnerable, namely because of increasing prices, job loss, loss of remittances, and the difficulties accessing basic services such as education and health care. The Arab region is estimated to lose at least 1.7 million jobs in 2020, which will add more hardship on the poor and most vulnerable groups.[12]

 

According to the World Bank’s estimates, 40 to 60 million people globally will fall into extreme poverty as a result of COVID-19, the global extreme poverty rate reaching 9 percent in 2020.[13] A model based on a contraction of per capita income or consumption of 10 percent, estimates that the poverty headcount rate could increase for the first time since the mid-1990 in the MENA region [14], while to latest statistics by UN-ESCWA, estimates that, following the outbreak of COVID-19, an additional 8.3 million people will fall into poverty in the Arab region, raising the number of undernourished people by around 2 million.[6]

 


This overview has been updated by the ADP team based on latest available data as of May 2020.


Sources:
[1] The Human Development Index (HDI) is a summary measure of average achievement in key dimensions of human development, namely health, education and standard of living. The health dimension is assessed by life expectancy at birth, the education dimension is measured by mean of years of schooling for adults aged 25 years and more and expected years of schooling for children of school entering age and the standard of living dimension is measured by gross national income per capita.
[2] United Nations Development Programme (UNDP). 2019. Human Development Reports. [ONLINE] Available at: http://hdr.undp.org/en/content/human-development-index-hdi [Accessed 26 May 2020].
[3] The United Nations Development Programme. 2020. COVID-19 AND HUMAN DEVELOPMENT: Assessing the Crisis, Envisioning the Recovery. [ONLINE] Available at: http://hdr.undp.org/en/hdp-covid [Accessed 26 May 2020]
[4] United Nations Economic and Social Commission for Western Asia (ESCWA), League of Arab States (LAS), United Nations Children's Fund (UNICEF) and Oxford Poverty and Human Development Initiative (OPHI), 2017. Arab Multidimensional Poverty Report. [ONLINE] Available at: https://www.unescwa.org/sites/www.unescwa.org/files/publications/files/multidimensional-arab-poverty-report-english_0.pdf [Accessed 26 May 2020].
[5] The Multidimensional Poverty Index (MPI) developed for the Arab Region is composed of three dimensions: education, health and living standards and twelve indicators. The Regional MPI does not take into consideration the income dimension. Ten countries are covered:  Jordan, Tunisia, Algeria, Egypt, Morocco, Iraq, Comoros, Mauritania, Sudan and Yemen.
[6] United Nations: Economic and Social Commission for Western Asia. New ESCWA brief: 8.3 million people will fall into poverty in the Arab region due to COVID-19 [ONLINE] Available at: https://www.unescwa.org/news/new-escwa-brief-83-million-people-will-fall-poverty-arab-region-due-covid-19
[7] The World Bank. 2019. Yemen Overview. [ONLINE] Available at: https://www.worldbank.org/en/country/yemen/overview [Accessed 26 May 2020].
[8] United Nations Development Programme. 2019. Assessing the Impact of War on Development in Yemen. [ONLINE] Available at:
https://www.undp.org/content/dam/yemen/General/Docs/ImpactOfWarOnDevelopmentInYemen.pdf [Accessed 18 May 2020].
[9] Syrian Center for Policy Research (SCPR). 2019. Food Security and Conflict in Syria. [ONLINE] Available at: https://www.scpr-syria.org/launch-of-food-security-conflict-in-syria-report/ [Accessed 26 May 2020].
[10] Alvarado, F., Assouad, L., and T. Piketty T., September 2017. Measuring Inequality in the Middle East 1990-2016: The World’s Most Unequal Region? WID.world Working Paper 2017/5. [ONLINE] Available at: http://wir2018.wid.world/ [Accessed 26 May 2020].
[11] The World Bank. 2019. World Development Indicators (WDI). [ONLINE] Available at: https://databank.worldbank.org/data/reports.aspx?source=world-development-indicators [Accessed 26 May 2020].
[12] The United Nations Development Programme. 2020. Impact of COVID-19 on economy in the Arab region. [ONLINE] Available at: https://www.arabstates.undp.org/content/rbas/en/home/coronavirus.html
[13] The World Bank. April 2020. Poverty Overview. [ONLINE] Available at: https://www.worldbank.org/en/topic/poverty/overview. [Accessed 26 May 2020]
[14] UN University World Institute for Development Economics Research. April 2020. Estimates of the impact of COVID-19 on global poverty. WIDER Working Paper 2020/43 [ONLINE] Available at: https://www.wider.unu.edu/publication/estimates-impact-covid-19-global-poverty [Accessed 26 May 2020]



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Data Highlights

  • Based on the extreme poverty headcount by measuring population whose income is less than USD 1.25 per day, the Arab region comes out as the only region in the world where poverty has increased since 2010. In 2010, 4% of the Arab population was living below the international poverty line of USD 1.25 per day, while 40% were living below USD 2.75 per day.

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