Poverty is on the rise in Egypt, particularly in rural areas, according to a study released earlier this month by the government statistics agency. Analysts blame the worsening situation in rural governorates on the government’s bias towards urban development over the past two decades.
Between 2004 and 2009, the percentage of Egyptians living at or below the World Bank’s official poverty line of US$2 per day increased from 19.6 percent to 21.8 percent, the Central Agency for Public Mobilization and Statistics (CAPMAS) study found.
Instances of poverty increased at a much higher rate, 4.6 percent, in the rural parts of Upper Egypt, where 43.7 percent of the population lives in poverty, according to the study. Urban governorates, such as Cairo, Giza and Alexandria, saw poverty increases as well, but by 1 percent, as compared to 6.9 percent for the overall population.
During the same period, Egypt experienced a relatively high rate of GDP growth, averaging 5.85 percent per year.
“During Mubarak’s reign, Egyptian developmental policies exhibited a notable urban bias that led to such a high rate of poverty in rural areas,” said Reem Saad, a professor of Social Anthropology at the American University in Cairo.
In 1992, the government passed the Agricultural Reform Law 96, which ended rent-controlled land for small farmers – a law in place since 1952. After the law's implementation in 1997, many landlords raised rent far beyond their tenants' ability to pay and small farmers were left without land, subsistence or employment.
Unemployment among poor families has increased by 3 percent to 17.5 percent, the study found, while it decreased by 2 percent to 15 percent for the rest of the population.
Saad believes that, 14 years after its implementation, the Agricultural Reform Law is showing signs of having long-term negative effects on the development of rural Egypt, and the ability of many to get out of poverty.
One of the main differences between rural and urban Egypt is access to public infrastructure, according to Saad. Urban dwellers across the country, unlike their rural counterparts, have almost universal access to electricity and water. Many rural areas also lack access to sewage treatment infrastructure, which, in some of Upper Egypt’s rural governorates, reached as low as 12 percent of the population.
“In my research, I saw many rural residents collecting money among themselves to provide basic infrastructure that people in urban governorates never have to think about,” said Saad.
Even within rural governorates, there’s a bias, Saad argues. Whereas rural centers that serve many remote villages receive infrastructure, those in the surrounding areas find it difficult to access. This is why the urban bias may be even stronger than official numbers indicate, she says.
“A rural center may have a health center, and officially the numbers say that all of the surrounding villages have access to a doctor, while that may not be the case,” she says.
“Agricultural infrastructure has been geared toward large landowners since 1974, when former President Anwar Sadat began implementing agricultural reform that was biased against smaller landowners,” said Bashir Saqr, a member of the Committee for Solidarity with Egypt’s Agricultural Reform Peasants. Saqr’s organization was recently established as an advocacy group for peasants who have been kicked off their land – or are in danger of eviction – due to the reforms.
The Agricultural Reform Law aside, Saqr believes that neglectful agricultural policy has led to a deterioration in farmers’ livelihoods along with the land.
“Some fertilizers and agricultural materials are too expensive for small landowners due to the high taxes on them. There’s no enforcement of adequate crop rotation systems, and there is no adequate protection of peasants from hostile takeovers by corrupt large landowners,” he said.
The urban bias in distribution of national wealth, coupled with the “do-it-yourself attitude” the government has taken toward rural areas, are causing income and development to lag in these areas, Saad argues.
“I’ve seen many cases where villagers are forced to pay for the most basic services, such as building a school for their kids and securing a post-office building by reinforcing the walls,” she says.
But if the autocratic Mubarak ignored the needs of rural Egyptians and allowed more of them to fall into poverty, the post-Mubarak transition indicates that there might be reason for optimism, as potential presidential candidates realize the need to address rural poverty.
Mohamed ElBaradei recently met with Egypt's rural poor to discuss the difficulties they face. The low agricultural production relative to the high percentage of the population working in agriculture is an indication that the sector and workers, which represent 40 percent of the Egyptian population, have been neglected, ElBaradei said.
Karama Party candidate Hamdeen Sabahi recently declared himself “a son of peasants,” referencing his upbringing in the rural Kafr al-Sheikh governorate in an effort to endear himself to rural communities.
Mubarak’s National Democratic Party (NDP) lauded its developmental achievements between 2005 and 2010 during the November 2010 elections, but CAPMAS’s findings differ from the NDP narrative.
In the five-year span of their study, CAPMAS researchers found that there has been virtually no improvement in the field of education and literacy in Egypt, whether for the poor or rich. Of poor families, 41 percent remain completely illiterate compared to 24 percent for the rest of the population (a 1 percent drop since 2005). Only 1 percent of Egypt’s poor have received any form of higher education degrees (including workshop diplomas etc.), in contrast to the 11 percent of the rest of the population. The fact that the numbers did not change indicates lack of improvement.
Other recent economic studies show that the standard of living in Egypt has been in steady decline since 1978. A 2009 paper by economist Ahmed al-Naggar claimed that after adjusting for prices and inflation, purchasing power for minimum wage earners in Egypt has declined by about two thirds since then.
Naggar estimated that a minimum wage earner back then could purchase – in today’s money – LE1900 worth of staple products. Today, after the minimum wage was adjusted to LE700, most Egyptians still cannot afford to provide anything close to what they could afford back then.