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: / Strategies / National Poverty Reduction Strategy (2003-2005)




Kyrgyzstan Review, 10 years ago




CHAPTER I. THE SCALE OF POVERTY

1. The Kyrgyz Republics household survey data for 1996-2001 has played a key role in the prioritization of the measures taken under the NPRS. In order to ensure data comparability, the survey has used information on poverty levels and profiles based on average per capita expenditures of the population.
2. In 1996 - 1997[1], the poverty level remained steady, while the number of people living in extreme poverty was reduced. However, in 1998 the incidence of poverty increased to 54.9[2] percent of the population, with 23 percent of population in extreme poverty. The incidence of poverty in 1999[3] remained practically unchanged at the level of the previous year. Since then there has been some reduction in the poverty level, largely the result of economic and social measures taken by the State in order to raise living standards. In the year 2000, poverty declined to 52 percent, while extreme poverty went down to 17.8 percent. In 2001, 47.6 percent of the population was classified as poor and 13.5 percent as extremely poor. The poverty gap index was 13.9 percent.
3. A notable feature of poverty distribution is that rural poverty is higher than it is in urban areas.
 
Table 1: Poverty in urban and rural areas (percent)
 
 
Year
Poor
of these, extremely poor
Poverty gap[4]
Severity of poverty[5]
Total
Urban
Rural
Total
Urban
Rural
 
 
 
 
 
 
 
 
 
1996
43.5
30.3
49.6
19.1
10.3
23.3
15.9
7.9
1997
42.9
22.2
55.3
14.8
4.9
20.7
13.9
6.3
1998
54.9
42.2
62.4
23.0
18.3
25.8
19.5
9.2
1999
55.3
42.4
60.0
23.3
17.1
25.6
19.8
9.8
2000
52.0
43.9
56.4
17.8
12.7
20,5
17.7
7.7
2001
47.6
41.2
51.0
13.5
9.6
15.6
13.9
5.6
 
 
 
 
 
 
 
 
 
 
4. From 1996 to 1999, the expenditure level of the wealthiest strata of the population was almost seven times higher than that of the poorest. Over subsequent years this gap shrank to 4.8 times in 2001. Reduction in expenditure inequality is explained primarily by a more than 10 percent increase in the income of the poorer levels of society. As a result, the Gini index has declined. These positive trends have helped to alleviate social tension in the country.
 
 
Box 1: Poverty Measurement Methodology
 
In the year 2002 the National Statistical Committee (NSC) jointly with experts of international organizations have identified several methods that can be used for assessment of welfare in measuring the level of poverty in the Republic. For the past several years, NSC has been publishing poverty data using the information on the level of average per capita expenditures as a welfare measurement criterion. Other poverty criteria recommended by foreign experts are per capita consumption and per adult equivalent consumption.
Per capita expenditures include expenditures for food, cost of home-produced and home-consumed food products, nonfood commodities, including consumer durables and personal services.
Per capita consumption is measured using per capita expenditures of estimated cost of consumer durables available in the household, regardless of the products service life, except for the cost of real estate. International methodology includes in consumption only those expenditure items that are consumed by a household within a year. Hence, expenditures such as acquisition of real estate, livestock, assistance and gifts to other people, taxes and other payments are not included in consumption.
 
A number of issues related to size and composition of households arises in the process of calculating aggregate expenditure or consumption indices. Lack of adequate adjustment can lead to overestimation of poverty in large households and underestimation in smaller ones. Since there are many large families in Kyrgyzstan there appears to be the need to make an adjustment for equivalent size of households.
Per adult equivalent consumption generally determines the share of adult population, including women, children and elderly, with equivalent scale coefficient for calculation of the general size of the equivalent in relation to the able-bodied man in a household. The equivalent scale coefficients have been calculated on the basis of consumption norms developed for the Kyrgyz Republic by the University of North Carolina using the household survey data of the 1993 poverty study. Equivalent adult consumption was applied to measure poverty level in particular households, in order to see whether they qualify as poor or not.
NSC and foreign experts have recalculated general poverty levels using data from the household survey for the year 2001. The results of this survey were evaluated using all three welfare measurement methods. All three methods indicated reduction of poverty in 2000 and 2001. The following table summarizes the results.
Table : Poverty level in the republic as determined by three welfare measurement methods.
 
Welfare indicators
General poverty line,
Soms per year
Poverty level,
Percent
 
 
 
2000
2001
 
Per capita expenditures
7491
52.0
47.6
 
Per capita consumption
6975
62.5
56.4
 
Consumption per adult with adjustment
for equivalent size of a family
 
6975
 
51.8
 
45.0
 
Table 2: Gini index (consumption) (shares)
 
 
1996
1997
1998
1999
2000
2001
 
 
 
 
 
 
 
Total
0.370
0.410
0.360
0.372
0.326
0.320
Urban
0.370
0.380
0.364
0.371
0.322
0.313
Rural
0.350
0.360
0.341
0.362
0.323
0.351
Ratio of Consumption Level of the wealthiest quintile of the population to the poorest quintile.
6.8
7.5
6.1
6.8
5.5
4.8
 
5. No improvement has been observed in the level of unemployment - an important poverty factor. According to the Employment Department of the Ministry of Labor and Social Protection of the Kyrgyz Republic (MLSP), in 2001, the registered unemployment level was 3.2 percent, 0.3 percent higher than in 1999. The unemployment rate among women remains higher than that of men. The highest rate of unemployment is noted among people 18-49 years of age.
 
Table 3 : Registered unemployment, by age groups and gender (percent)
 
 
1999
2000
2001
Total
Male
Female
Total
Male
Female
Total
Male
Female
 
 
 
 
 
 
 
 
 
 
Number of unemployed
54749
24156
30593
58329
27082
31247
60522
27985
32537
of these, aged:
 
 
 
 
 
 
 
 
 
16 17
3.9
3.9
3.8
4.4
4.2
4.6
5.0
5.1
4.9
18 21
11.9
11.3
12.4
11.4
11.4
11.3
10.6
11.2
10.1
22 28
20.4
19.9
20.7
24.0
23.5
24.5
21.5
21.0
22.0
29 39
36.1
36.2
36.1
35.5
35.8
35.3
33.6
33.6
33.6
40 49
21.3
19.7
22.6
19.9
19.6
20.2
22.8
21.9
23.6
50 54
4.9
5.7
4.3
3.6
3.4
3.8
5.0
5.0
5.0
55 60
1.5
3.3
0.0
1.1
1.9
0.4
1.3
2.0
0.7
Over 60
0.0
0.0
0.0
0.0
0.1
0.0
0.1
0.2
0.0
 
 
 
 
 
 
 
 
 
 
 
6. Official unemployment is uneven throughout the Republic. In 1999-2001, there was a reduction in the number of registered unemployed in the Osh region (by 6.6 percent), Bishkek (by 3.7 percent), Jalal-Abad region (by 2.4 percent), with increases in unemployment in Naryn, Chui and Batken regions, ranging from 1.4 to 2.5 percent (see Table 4, below).
 
7. It must be noted that official figures do not fully reflect the situation in the labor market. According to International Labor Organization (ILO) methodology, unemployment estimates can fluctuate in the range of 7 to 11 percent.
 
8. Unemployment is the primary cause of intensified internal migration in the Republic. The main movement has been from rural areas to the cities. Such relocation creates problems of increased numbers of unregistered unemployed in cities, reduced access of migrants to health and education services, marginalization of the population and increases in crime.

Table 4: Unemployment by regions (percent)
 
 
1999
2000
2001
 
 
 
 
Kyrgyz Republic, number of people 
54749
58329
60522
 
 
 
 
Jalal-Abad oblast
21.1
19.0
18.7
Issyk-Kul oblast
8.8
7.7
8.3
Naryn oblast
9.3
11.4
11.8
Osh oblast
22.9
15.1
16.3
Talas oblast
3.5
3.3
3.0
Chui oblast
13.9
17.5
16.0
Bishkek
20.6
18.4
16.9
Batken oblast
 
7.7
9.1
 
 
 
 
 
9. Despite the high incidence of poverty, a relatively high birth rate has remained. In 2001 the fertility rate[6] was 2.4 children.
 
10. The mortality rate in recent years has declined from 7.3 deaths in 1997 to 6.6 deaths per 1000 people in 2001. In 2001, 47 percent of deaths were due to cardiovascular diseases, 11 percent to respiratory diseases, 10 percent to accidents, poisoning and other external causes, and 9 percent to tumors.
Despite the relative reduction in the mortality rate, infant mortality remains high (28.2 deaths per 1000 live births in 1997, down to 21.7 in 2001). It must be borne in mind that national criteria for live births and infant mortality differ from internationally accepted standards, so that the infant mortality rate is understated in the Republic. Declines in infant mortality are mainly attributed to reduction in the number of deaths due to respiratory, infectious and parasitic diseases. Diseases of the perinatal (post birth) period are the leading cause of infant death, representing 38 percent of infant deaths. High infant mortality in the perinatal period is closely connected with the health of mothers, whose mortality rate is also high (43.8 maternal deaths per 100,000 live births in 2001).
 
11. Starting from 2001, for the first time, diseases of the perinatal period topped the list of causes of death among the newly born (respiratory diseases accounted for 43.5 percent of infant mortality in 1997).
 
12. Reduction in the incidence of poverty has positively affected life expectancy in the Republic. There was a slight increase in life expectancy from 66.9 years in 1997 to 68.7 in 2001. Life expectancy of men was 65 years and that of women was 72.6 years. Male mortality is 1.5 to1.6 times higher than female mortality. Thus, women outnumber men; in 2001 there were 1000 women per 975 men.
 
13. There have been several changes in the literacy situation in the period under review. Among people aged 7 years and older, 1.2 percent[7] was illiterate. Of these, 51.4 percent were elderly, 16.7 were children aged 7 to 10 years who live in poor families and could not attend schools, 32 percent were children with mental and physical deficiencies and naturally handicapped. In spite of the high literacy rate, there were certain differences in educational coverage of children by age groups and poverty status. The proportion of children with primary and middle (incomplete secondary) education remains high. However, a reduced proportion of children aged 16 and 17 years, especially boys, with complete secondary education raises concerns. This reflects the earlier departure of school children for technical education, rather than remaining to complete secondary school.
 
Table 5: Children enrolled by level of schooling (percent of corresponding age group)
 
 
1999
2000
2001
Primary education (grades 1-4)1
 
 
 
Total
97.7
97.2
96.6
Boys
98.6
98.6
97.9
Girls
96.8
95.8
95.3
Middle education (grades 5-9)2
 
 
 
Total
82.8
94.9
93.6
Boys
82.0
95.1
93.5
Girls
83.7
94.6
93.7
Complete secondary education
(grades 10-11)3
 
 
 
Total
75.6
47.0
48.9
Boys
70.5
43.4
45.6
Girls
80.8
50.6
52.3
 
 
 
 
1 (grades 1-4) - 7-10 year old
2 (grades 5-9) - 11-15 year old
3 (grades 10-11) - 16-17 year old
 
14. Poor groups have limited access to public utility services. Due to the inadequate development of infrastructure, utility services are less available to poor households and to families living in rural and mountainous areas. Electricity is practically the only utility provided to the whole population.
 
15. Service quality does not always meet established standards and many households receive these utilities in limited amounts or inconsistently. As regards access to clean drinking water, nearly 20 percent of the rural population and 30 percent of population living in high mountainous areas use water from rivers and canals, which poses health risks.
 
Table 6: Access to utilities, by poverty status, 2001 (percent)
 
 
Running water
Natural gas
Central heating
Telephone
 
 
 
 
 
Total
33.9
30.6
22.6
24.2
Non-poor
43.5
39.3
29.5
32.2
Poor
23.4
21.0
15.0
15.4
of these, extremely poor
16.9
9.5
8.8
11.9
Urban
72.4
54.5
55.9
47.6
Rural
13.3
17.8
4.7
11.8
High mountainous areas
5.1
 
3.0
15.5
Lower mountainous areas
19.8
24.3
8.8
24.8
Plains
40.8
36.3
28.0
25.4
 
 
 
 
 
 
Table 7: Sources of water, by residence and poverty status, 2001 (percent)
 
 
Total
Centralized running water
Street water tap
Well
Spring
River, canal
 
 
 
 
 
 
 
Total
100.0
33.94
45.63
3.36
1.06
16.01
Non-poor
100.0
43.50
40.57
2.30
1.20
12.43
Poor
100.0
23.43
51.20
4.52
0.91
19.94
of these, extremely poor
100.0
16.91
54.62
6.04
0.66
21.77
Urban
100.0
72.42
26.00
1.04
0.06
0.48
Rural
100.0
13.29
56.17
4.61
1.60
24.34
High mountainous areas
100.0
5.09
55.35
2.75
5.81
31.00
Lower mountainous areas
100.0
19.77
63.78
3.07
1.30
12.08
Plains
100.0
40.82
40.92
3.50
0.30
14.46
 
 
 
 
 
 
 
 
16. The poverty profile analysis for the year 2001 raises concerns about the number of children living in poverty. Children under 17 years of age constitute nearly 40 percent of the total population of the Republic. Of these, nearly 55 percent live in poor families.
 
17. According to the Social Fund of the Kyrgyz Republic, the number of pensioners (retirees) is declining. In recent years, the average pension rose 1.5 times. However, its level is still not high enough to provide pensioners with essential goods and services.
 
18. MLSP data shows that in the year 2001, 470,300 people received a unified monthly benefit (UMB), the average size of which equaled 65.67 soms per month (approximately US$1.42). Although the average UMB size was 1.3 times higher in 2001 than in 1999, households receiving this benefit can barely avoid extreme poverty.
 
Table 8: Recipients of social benefits and UMB
 
 
Number of recipients, persons 
 
Total monthly
outlay
000 soms
Average size of benefit,
soms per month 
1999
2000
2001
1999
2000
2001
1999
2000
2001
 
 
 
 
 
 
 
 
 
 
Social benefits
36021
38736
41975
5325.0
5929.6
10973.4
147.83
153.02
261.43
 
 
 
 
 
 
 
 
 
 
Benefits to naturally handicapped
14315
15122
16223
2314.6
2422.0
4724.8
161.69
160.17
291.24
Benefits to handicapped children under 16 years of age
13622
14839
15718
2296.3
2485.1
4787.4
168.57
167.47
304.58
Benefits to handicapped due to general diseases
1003
1103
1287
104.1
113.3
243.1
103.81
102.72
188.89
Age benefits
4110
3740
3483
292.0
284.6
187.3
71.05
76.10
53.78
Benefits to mothers with many children
152
160
160
24.1
26.2
46.1
158.39
163.80
288.13
Benefits for children to families with lost breadwinner
2819
3772
5104
293.9
398.3
984.7
104.25
105.59
192.93
 
000 recipients
Mln. soms
 
 
 
Indigent citizens
476.8
503.4
470.3
23.92
24.29
30.88
50.16
48.25
65.67
 
 
 
 
 
 
 
 
 
 
19. At the same time, it must be noted, the increase in the number of social benefit recipients, especially recipients of benefits for the loss of family breadwinner (1.8 times increase compared with 1999). A simultaneous rise is observed in the average size of all social benefits (1.8 times increase compared with 1999), except for age benefits, which have declined by 25 percent.


[1] According to survey of 2000 households under the Poverty Monitoring Project, 1996-1997.
[2] According to survey of 3000 households under the Poverty Monitoring Project, 1998.
[3] According to survey of 3000 households under the Energy Conservation Project, 1999.
[4] Poverty gap (or deficit) is calculated as average amount by which the expenditures (or consumption) of all poor households fall below the poverty line
[5] Poverty severity index (or squared poverty gap) is calculated as average squared consumption shortfall of the population as proportion of the poverty line.
[6] Average number of children born to one woman of reproductive age.
[7] According to results of the First National Census, March 1999.