Sunday 1 October 2023

3.3 million GCC nationals live in poverty, says ESCWA

BEIRUT, May 24, 2023

Despite major efforts by Gulf Cooperation Council (GCC) countries to reduce poverty and strengthen the middle class in the last decades, 3.3 million citizens are still below the poverty line, according to a report by the United Nations Economic and Social Commission for Western Asia (ESCWA).
The report said based on information published by GCC national statistical offices on household income and consumption expenditure, the estimated ESCWA mean monthly household expenditure for GCC nationals varied widely in 2021, ranging from approximately $2,100 in Oman to $12,500 in Qatar.
The poverty lines also ranged widely between $971 (Oman) and $3,841 (Qatar) per household per month across GCC countries (or $4.6 to $14.7 per day percapita). 
However, the mean monthly average expenditure estimated in the policy brief are seen as quite high and could be disputed, say analysts. Taken into account the various benefits provided by the GCC governments to citizens, the povery line figures may also come under examination.
According to the brief, the estimated mean expenditure and poverty lines per household per month in local currency units at current prices are: 
* Bahrain - BD1,548  and BD 490
* Saudi Arabia - SR17,469 and SR5,394
* Kuwait - KD3,305 and KD 917
* Oman OR820 amd OR373
* Qatar QR45,661 and QR13,981
* UAE AED14,485 and AED4,914
The policy brief issued by ESCWA), titled "3.3 million GCC nationals living in poverty", highlights that poverty in most GCC countries has indeed declined since 2010, where some 530,000 citizens have been lifted from it. 
In Saudi Arabia alone, rates fell from 18.2% in 2010 to 13.6% in 2021, as 485,000 citizens were no longer considered poor. It notes, nonetheless, that the countries’ flourishing economies have led to the perception that their poverty rates were low or non-existent; consequently, little effort went into investigating the prevalence and depth of poverty, it added.
ESCWA Executive Secretary Rola Dashti explained that the distribution of income and expenditure among the population were key factors contributing to poverty. In some GCC countries, the expenditure of the richest 10% of households was 16 times greater than that of the poorest 10%, she noted.
“Financial reforms should be implemented to allow a broader share of the population to benefit from socioeconomic opportunities,” Dashti stressed. “This includes adopting a fair and equitable tax system; reforming land allocation and public procurement policies; reforming subsidy policies to target low-income groups; ensuring better targeting of social protection systems; and facilitating access to affordable housing, basic infrastructure, and quality health and education services.”
The policy brief proposes specific recommendations to tackle poverty in the GCC region, geared towards ensuring a more diversified and inclusive economy that leaves no one behind and is environmentally sustainable. They include diversifying sources of growth, and reforming educational and vocational systems to provide the new skills required for future jobs. The brief further stresses the need for strengthening the small and medium enterprises ecosystem, including through facilitating access to finance and fostering innovation and entrepreneurship programmes.


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