New Report on Armenia Poverty Rate Worries UNICEF

BY NANORE BARSOUMIAN
FROM THE ARMENIAN WEEKLY
The Republic of Armenia’s National Statistical Service, on December 17, released a critical report on the main findings of a 2009 Integrated Living Conditions Survey. The report, “Armenia: Social Snapshot and Poverty,” relies on RA-NSS data and information available from the Ministry of Labor and Social Affairs, the Ministry of Health Care, and the Ministry of Education and Science. It presents the poverty levels in Armenia in 2008 and 2009, and is the 11th in a series of reports that documents changes and conditions in Armenia.
According to the report, for the first time since 1998, Armenia saw an increase in the poverty rate in 2009, attributed to the global economic crisis. “Poverty in 2009 became both deeper and more severe,” states the report.
Based on revised and more accurate methods of poverty measurement and analysis, in 2009, 34.1 percent of the population was poor—20.1 percent of which was very poor and 3.6 percent extremely poor. In 2008, those numbers were 27.6 percent poor, 12.6 percent very poor, and 1.6 percent extremely poor.
The total annual income of adults living within the upper (poor) poverty line was estimated to be AMD 30,920 (USD 85.1); AMD 25,217 (USD 69.4) for those within the lower (very poor) poverty line; and AMD 17.483 (USD 48.1) for the extremely poor.
Between 2008 and 2009, 214,000 people became poor, raising the total to 1.1 million people. Likewise, 245,000 people became very poor, raising the total to more than 650,000. The number of extremely poor was raised to 117,000, with the addition of 65,000 people who became extremely poor.
The percentage of children, aged 0-18, living below the poverty line was 38.1, and 4.5 for those below the extreme poverty line. This figure is higher than the national average, which is 34.1 and 3.6, respectively. Furthermore, “although only 1.1 percent of children are disabled or live with other disabled children, 70 percent of them are poor and 13 percent are extremely poor. Disabled children are represented amongst poor children (2 percent) and are furthest from the poverty line, on average (19 percent),” found the survey. The child poverty rate was highest in Lori, at 9 percent, and lowest in Vayotz Dzor, at 1.9 percent.
The report further showed that in Shirak, Kotayk, Lori, Gegharquniq, and Ararat, the poverty rate was higher than the national average. In Shirak, for example, 47.2 percent of the population lived below the poverty line, making it the poorest region in Armenia.
Based on personal statements given by interviewees, a significant percentage of those who fell within the poverty line did not consider themselves to be poor. “In Armenia, poverty estimates based on subjective perceptions (personal judgment of individuals regarding their own welfare) tended to be lower than those attained using consumption per adult equivalent as an objective welfare measure (17.9 percent and 34.1 percent, respectively).” Only 2.9 percent of households perceived themselves to be extremely poor, and 15 percent to be very poor (excluding the extremely poor), as compared to the 3.6 percent and 30.5 percent, respectively, when assessed by the consumption per adult equivalent.
As to the level of satisfaction with paid services, the numbers suggest there was an overall increase. Armenians were most satisfied with the electricity supply (97.6 percent), public transportation (84.8), telephone (80.1), postal service (77.8), and sewerage service (68.5). They were less satisfied with the water supply (67.3 percent), garbage disposal (64.9), bank operations (63.8), education (62), healthcare (60.4), and irrigation (19.3).
A noteworthy segment of surveyed individuals reported positive change in the operation of certain services, such as sewerage service (a 10.1 percent increased positive change) and electricity supply (23.7 percent). The two services that had worsened were bank operations and healthcare.
“To overcome poverty, Armenia would need AMD 93.5 billion [USD 257.6 million], or 3 percent of GDP, in addition to the resources already allocated to social assistance, assuming that such assistance would be efficiently targeted to the poor only,” says the report. “Eradication of extreme poverty would require about AMD 2.5 billion [USD 6.9 million], or 0.1 percent of GDP, in addition to social assistance already channeled to the extremely poor and assuming efficient targeting.”
All urban and rural communities were included in the sample. Each month, 656 households were surveyed, 368 of which were from urban communities, and 288 rural. Eighty-two interviewers met with 8 households each per month, interviewing a total of 15,208 individuals.
In total, 7,872 households were surveyed in 2009 (same as in 2008), of which 4,416 were from urban, and 3,456 from rural communities. Overall, 45 urban communities were covered in 2009 (44 in 2008), along with 313 rural communities (263 in 2008).
The report also includes data on the relation of poverty to education, location, lifestyle, household composition, consumption, health, and healthcare, as well as findings on birthrate, life expectancy, and the country’s economic environment.
ILCS was first conducted in 1996, followed by one in 1998-99, and since 2001, it has been conducted every year. Currently, it is supported by the RA state budget and the Millennium Challenge Account-Armenia (MCA-Armenia). “Over 2007-11, the ILCS has been and will be used to, inter alia, assess the impact of implementing the agreement of USD 235.65 million signed between the U.S. government’s Millennium Challenge Corporation and the government of Armenia.” The World Bank assisted in the production of the report.
UNICEF Voices Concern
The day the report was published, UNICEF voiced its concern over the stark increase in poverty rates. The organization was especially alarmed at the level of child poverty rate in Armenia.
“The new data on child poverty is extremely worrisome. It is obvious that the economic and financial crisis hit children the hardest and we are now facing a situation where the child poverty rate is back to the level of 2004. The current trend is fraught with long-term consequences both for children as they may be ripped of some of their basic rights and the country’s overall development,” said UNICEF representative Laylee Moshiri.
“For children, poverty means high risks for malnutrition, overall development, and deprivation of basic conditions for child wellbeing. Therefore, tackling child poverty is not something that can wait until fiscal circumstances are seen as accommodating. Re-orienting social protection expenditure towards more efficient models may mitigate devastating effects of poverty on children and break the intergenerational cycle of poverty that threatens human development and economic growth,” added Moshiri.
To view the full NSS RA report, visit http://www.armstat.am/en/?nid=80&id=1202.
Basic poverty indicators by regions and in Yerevan (ILCS, 2009)