Implications of the Third National Poverty Assessment

1. Implications of the Third National Poverty Assessment Channing Arndt and Finn Tarp University of Copenhagen

2. Data, Definitions, and Methods • Data: The principle new source is the 2008/09 Household Budget Survey (IOF08). Combined with: • Previous household budget surveys (IAF02, IAF96) • Demographic and health type surveys (MICS08, DHS03, DHS97) • Agricultural production and income surveys (TIA02– TIA08 when available) • Other such SIMA, National Accounts, and administrative data.

3. Poverty • A multi-dimensional phenomenon. • Impossible to capture all dimensions with a single indicator. • Multiple indicators • Multiple perspectives • Strongly related to context and social norms.

4. Consumption Poverty- Method • Same method employed in First, Second, and Third Assessments. • STEPS: • Calculate per capita consumption for each household in the survey. • Divide Mozambique into 13 relatively homogeneous spatial domains. • In each domain, estimate a poverty line with two components: the food poverty line and the non-food poverty line. • Food poverty line is obtained by deriving a bundle of food products that: • reflects consumption patterns of poor households within the spatial domain, • provides approximately 2150 calories per person per day, and • passes a series of spatial and temporal revealed preference conditions that ensure comparability in the quality of the bundle across space and time (not done in 1996-97).

5. Consumption Poverty – Method (2) • Calculate prices paid by the poor for the elements of the bundles. • The food poverty line is then simply the cost of the bundle. • Calculate average non-food consumption share for households living near the food poverty line . • Derive total and non-food poverty lines using the food poverty line and the non-food share.

6. Limitations • The consumption measure developed applies to households and not individuals (resource allocation between household members). • The estimated total consumption of any given household makes no reference to the composition of consumption (resource allocation by the household). • Consumption of all public services is excluded.

7. Principal Results

8. Housing Quality

9. Asset Ownership

10. Notes • In the rural North and Centre, where 58% of the population is concentrated, 90% and 85% of the populations respectively reside in households with none of the four improvements shown. • The use value of durable goods represents a small share of total consumption with a median value of about 1.2% in rural areas and 3.1% in urban areas in 2008/09.

11. School Attendance (share of population > 5 years old)

12. Net Enrollment Rates

13. Share of HH within 45 Minutes Walk of Nearest Health Post

14. Access to Potable Water

15. Poverty Headcount

16. Headcounts and Standard Errors

17. Calorie Consumption

18. Possible Explanations • Enumerators utterly failed to track consumption of some households. • Some classes of consumption difficult to obtain and/or not appearing on the consumption register. • Quantities understated but not values. • Behavior of households under stress. • Household really did consume low quantities of calories.

19. International Comparisons(mean calorie consumption per capita)

20. International Comparisons: Uganda

21. Impact on Poverty: Preferred Approach

22. Summary • Accumulated evidence indicates likelihood of calorie undercounting (or food consumption underreporting particularly [but not exclusively] in urban areas and in Maputo). • Food consumption is more difficult to track in urban areas (Deaton 2005). • Levels of poverty change after correction (lower in urban zones in particular). • Trends are virtually identical across all correction procedures.

23. Consistency with Other Sources: National

24. Malnutrition Through Time

25. TIA Data Bases NOTAS: dados referem-se apenas à produção das culturas alimentares feita pelos pequenas e médias fazendas. Base populacaional é a população rural. Fonte: MPD/DNEAP com base no anuário estatístico dos TIAs (MINAG, preliminar)

26. Agriculture and Ag Technology.

27. Macroeconomic Consistency

28. Real International Prices

29. Simulated Poverty Rates Based on the CGE Model Taxa de pobreza (%)

30. Poverty Rates: Actual and Simulated • The Gini coefficient in the model rises to around 43.5 or two points above the estimates of 2002-03 and 2008-09.

31. Consistency Summary • Nacional • MICS • TIA • National accounts/model/inequality • Provincial • CPI • SIMA • Assets • Number of meals per day • Food shares • Declarations of Mozambicans

32. (VI) Conclusões e implicações • Estagnação (nacional) da pobreza de consumo desde 2002 relaciona-se com: • Falta do crescimento da produtividade agrícola, particularmente no sector familiar • Aumentos graves dos preços internacionais • Choques climaticos • Amarelecimento letal do coqueiro • HIV/SIDA • Estes factores eram mais graves no Centro do país • Melhorias significativas da pobreza não monetária • Tendências positivas do longo prazo – conforme esperado • Corresponde com as areas da prioridade do Governo (educação, saúde etc.)

33. (VI) Conclusões e implicações • Altos níveis de vulnerabilidade económica • Indicadores da desnutrição infantil continuam a ser persistentemente altos (consequencias serias para o crescimento a longo prazo) • Fluctuação substancial da produção agrícola devido à dependência da qualidade das chuvas e ao fraco acesso às tecnologias melhoradas • Prioridade é de estimular o sector agrícola familiar • O principal fonte de alimentação e rendimento para a população • O consumo dos alimentos representa 75% do consumo total dos pobres

34. (VI) Conclusões e implicações • Se conseguir estimular o sector agrícola familiar, Moçambique ainda pode reduzir a incidência da pobreza até 40% em 2015 • Conforme a Meta do Desenvolvimento do Milénio • Medição melhorada do consumo poderá aumentar a precisão da estimativa do nível de pobreza absoluta no Sul e nos centros urbanos (mas não alterará as tendencias e as implicações gerais) • Com precos internacionais estabelicidos e uma colheita razoável em 2009, a pobreza absoluta provavelmente é abaixo de 50% agora

35. Public Roles in Agriculture • Research • Extension • Provision of information • Market prices • Production levels (forecasts and finals) • Disease control (livestock and plant) • Land titling • Open pollinated seed • Associations • Grades and standards • Basic economic infrastructure (roads, ports, airports, …) • Emergencies, shocks, disasters.

36. Private/Public Domains in Agriculture‘Pump Priming’ • Rural credit • Inputs • Fertilizer • Pesticides • Hybrid seeds • Irrigation

37. Urban Issues/Employment • Agricultural policy is an important tool for influencing urban development. • Rate of rural/urban migration • Food prices • Business environment/tax policy • Poles of urban growth beyond Maputo • Leveraging natural resource investments • Labor intensive exports • Urban planning/investments

38. Other measures • Social protection • For practical purposes, mostly confined to urban areas. • Much better than untargeted subsidies. • Potentially expensive (requires careful design and consideration of fiscal implications) • Child malnutrition • Information • Proactive promotion of public health

39. Information Systems • Insufficient frequency of surveys • Six years leaves long information gaps • Fits poorly with planning/budgeting cycle • Renders capacity building more difficult • Effectively precludes a panel dimension • Risk of survey failure or peculiar years • Results in non-official data gathering efforts that usually lack national coverage and frequently are of low quality. • Agricultural statistics • Timeliness • Production forecasts/early warning

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