Poverty reduction rates slow down in Kazakhstan - World Bank experts
Although poverty in Kazakhstan continues declining, the poverty reduction rates have slowed significantly, World Bank experts mark on the eve of International Day for the Eradication of Poverty.
Kazakhstan has made significant strides in reducing poverty since getting independence. Extreme poverty has almost eradicated in the country, as measured by the international poverty rate of 1.9 US dollars per day.
As in other Central Asian countries, in Kazakhstan, the highest poverty reduction rate was from 2002 to 2009. During this period the poverty level decreased by 4 percentage points per year (from 28% in 2002 to 2% in 2009), after which the country practically eliminated poverty in terms of the indicator applied to low-income countries (3.2 US dollars per day).
However, when using the indicator for countries with an income above the average level of 5.5 US dollars per day, to which Kazakhstan belongs, the poverty level decreased from 65% in 2002 to 6% in 2013 and has since remained steadily higher 7%.
According to World Bank experts, many Kazakhstanis remain vulnerable in the face of economic instability. The two most notable cases occurred in 2005 and approximately from 2013 to 2016. In these periods of low growth, many people again fell below the poverty line, although not in extreme poverty. Thus, the poverty level in terms of 5.5 US dollars per day rose from 6% in 2013 to 11% in 2016, and only as the economy recovered, did the poverty level begin to decline again.
Today, the average poverty rate (at 5.5 US dollars per day) is at 8.6%, and according to the World Bank forecasts, at the current rate of progress, it will remain above 6% until 2021. However, the experts note that poverty in some remote areas of the country, such as Ordabasy, Ayagoz, Saryagash districts and some districts of Zhambyl region, reaches more than 30% (according to the indicator of 5.5 US dollars per day).
The analysis also shows that the middle class of Kazakhstan is almost completely concentrated in several large cities and around them: Nur-Sultan, Almaty. One of the main problems facing all countries of the region, including Kazakhstan, is the difficulty of ensuring people's access to dynamic labor markets in large cities. The main factor contributing to the solution of this problem is the cost of housing. Housing in two large centers of Kazakhstan - Almaty and Nur-Sultan - is 190 and 240 percent more expensive than the national average. In terms of local income, housing in these cities is no longer affordable than in some of the world's most expensive metropolitan areas, including San Francisco, Sydney and Vancouver.
“The World Bank recommends policy that will provide people with more employment opportunities, including affordable housing in growing and prosperous cities. In addition, it will be very important to promote wage growth and support vulnerable groups, including youth and women, so that they can be more competitive in the labor market”, William Seitz, a World Bank economist in Central Asia, said.
