WB, IMF forecast 9% growth in poverty rates in Armenia and Georgia

PanARMENIAN.Net - Food and energy price inflation is highest among the lower income countries of the region. The highest food inflation rates were in the Kyrgyz Republic (27 percent) and in Georgia (23 percent). Energy inflation is also the highest among the lower income countries of the region, World Bank and IMF experts said at the World Bank/IMF Spring Meetings 2011.

Despite the nascent recovery, many ECA countries are still grappling with lower wages and higher unemployment resulting from the global crisis. If no countervailing measures are undertaken, and unemployment does not fall fast enough, the increases in food and energy prices could push 5.3 million more people across the region into poverty, with most of the higher poverty due to the food price increases.

Poverty could increase in some of the lower income countries of the region. Potential increases in poverty rates could reach 11 percentage points for the Kyrgyz Republic, 9 for Armenia and Georgia, 8 for Tajikistan, and around 5 percentage points for Moldova. Elevated food and energy prices will also put these countries’ external balances under strain, along with Albania, Bosnia Herzegovina, Kosovo, and Montenegro, and hence increase their external financing needs.

The countries may need to expand the coverage and adequacy of their social assistance systems in order to protect the additional poor, reads a press release the WB Yerevan Office sent to PanARMENIAN.Net