GLOBAL ECONOMIC CRISIS RESULTS IN GROWTH OF POVERTY LEVEL IN ARMENIA: WB SPECIALISTS SAY

ArmInfo
2009-11-17 16:03:00

ArmInfo. World Bank surveys showed that overall poverty rate in
Armenia has increased from 25.6% in 2008 Q2 to 28.4% in 2009 Q2,
a nearly 3 percentage points increase. In other words, the number
of poor in Armenia had increased by over 90,000 in 2009 Q2 compare
to 2008 Q2. Lire Ersado, Senior Economist at the World Bank said
on Tuesday when presenting the report "Armenia – Poverty and Social
Impact of the Global Economic Crisis."

Without mitigation measures, particularly those by the government
through protection of social spending and improved targeting of the
Family Benefit, overall poverty would increase by about 6 percentage
points, L. Ersado said. The level of extreme poverty has nearly
doubled from 3.6% in 2008 Q2 to 6/9% in 2009 Q2 increasing the number
of extremely poor individuals by over 107,000.

The report says that households responded to the crisis though
several behavior changes, including: substitution of cheaper foods
to more expensive, reduction of spending on healthcare and medicines,
increased use of public transportation and less use of entertainment
and fewer meetings with friends. On the other hand spending on alcohol
spiked by over 60%.

L. Eesado said that these developments are a setback for Armenia
after a decade of nearly double-digit growth (which averaged 12% over
2001-2007) and reduction in poverty incidence from 56.1% in 1998/99 to
23.5% in 2008 (an over 32 percentage points decline in 10 years). To
preserve its hard-earned gains, the government ahs taken several
measures to sustain macroeconomic stability such as securing external
financing and abandonment of the fixed exchange peg of the dram to the
US dollar. The authorities also protected social protection spending
crucial for the poor and vulnerable, the WB representative said.

From: Emil Lazarian | Ararat NewsPress