Egypt faces two major nutritional challenges that have critical implications for the country’s economic future: the disconnect between economic growth and human nutrition and the widespread coexistence of under- and over nutrition among rich and poor people in rural and urban areas. The forthcoming IFPRI book “Nutrition and Economic Development: Exploring Egypt’s Exceptionalism and the Role of Food Subsidies” by Olivier Ecker , Perrihan Al-Riffai , Clemens Breisinger (IFPRI) and Rawia El-Batrawy (CAPMAS) provides an in depth investigation into the drivers and causes of these two exceptional development challenges. It makes a strong case of putting nutrition high on Egypt’s development agenda and provides concrete policy options for doing so.
Preview of Key Findings:
Egypt is exceptional:
Despite relatively high economic growth, the prevalence rate of child stunting increased significantly and steadily throughout the 2000s—an atypical trend for a country outside war times. According to the 2010/11 Household Income and Expenditure Survey (HIECS), among the Egyptian children aged 6-59 months, 31 percent are stunted—a prevalence rate that is usually only seen in developing countries with much lower national income levels than Egypt’s. Egypt also ranks among the countries with the highest rates of female overweight and obesity in the world, with 73 percent of all (non-pregnant) women aged 20 years and older being overweight and 34 percent being obese (according 2011 estimates). The prevalence of overweight among children (29 percent) is almost as high as the prevalence of child stunting. Interestingly and surprisingly:
- The double burden of malnutrition does not only occur at the national level but also at the family and even the individual level: 22 percent of the children who are stunted have a mother who is overweight, and 14 percent of the children suffer from both stunting and overweight at the same time.
- Chronic child under nutrition, child and maternal over nutrition, and the double burden of malnutrition are prevalent at similar rates among the poorest and the richest income quintile of the population as well as in urban and rural areas.
What are the Drivers of Egypt’s Exceptionalism?
The forthcoming book identifies four key drivers of Egypt’s two—interlinked—nutritional challenges, which, in combination, may have led to the country’s exceptionalism:
- The nutrition transition, which refers to the shift in dietary patterns and physical activity levels, have progressed quite rapidly in Egypt in the wake of rapid economic growth and transformation together with urbanization and other changes in the economy.
- Consecutive economic crises and rising poverty; since the late 1990s, Egypt has experienced several major economic crises which have contributed to the increase in poverty and therewith household food insecurity.
- The food subsidy system; food subsidies and their reforms are unlikely to be neutral to nutrition outcomes. The design of the food subsidy system and its modification over time may have contributed to prevent common nutritional progress and to even aggravate Egypt’s nutritional challenges through two major effects; first it has incentivized overconsumption of cheap, calorie-rich foods and unbalanced diets Second, given its heavy and growing burden to the public budget, the food subsidy system may have bound funds, which hence have been unavailable for more nutrition-beneficial investments”
- Insufficient nutrition-sensitive investments; an increase in disease burden as well as a decrease in prevention and treatment of under- and overnutrition during the 2000s may be a consequence of underinvestment in nutrition-sensitive infrastructure and public services as well as in primary health care, including maternal and child health and nutrition interventions.
What methods does the book employ?
The authors employed impact evaluation methods and cross-section household survey data to identify potential causal effects of the ration card program subsidies and the Baladi bread and flour program subsidies on various indicators of under- and overnutrition and their coexistence at individual and family levels. The existence of these causal relationships is fundamental for the hypothesized role of the food subsidy system as a driver of the double burden of malnutrition and the growth-nutrition disconnect.
The econometric analysis uses propensity score matching (PSM) approaches for binary and continuous treatment variables and data from the 2010/11 Egypt Household Income, Expenditure, and Consumption Survey (HIECS), conducted by Egypt’s Central Agency for Public Mobilization and Statistics (CAPMAS), to investigate the direct impact of food subsidies on child and maternal nutrition, the double burden of malnutrition at the individual and the family level, and household diet quality.
What is the role of food subsidies?
The results of an investigation of the direct impact of food subsidies on child and maternal nutrition, the double burden of malnutrition at the individual and the family level, and household diet quality, suggest that that the ration card program (as in place until May 2014) considerably affects under- and overnutrition mainly in urban areas. The Baladi bread and flour program has notable effects on overnutrition in both urban and rural areas. The nutritional impact of the ration card program is generally larger than that of the Baladi bread and flour program.
Higher food subsidies increase the risk of malnutrition among both children and their mothers, particularly related to overnutrition. In urban areas, the probability of child overweight and the probability of maternal overweight increase with the subsidy levels that the families acquire from the ration card program. And, maternal overnutrition is more common among beneficiary families of the ration card program than among non-beneficiary families. Urban mothers’ risk of overweight tends to also increase with increasing Baladi bread and flour subsidies. Thus, the estimation results for household diet quality indicators confirm that the ration card program seems to indeed adversely affect nutrition in urban areas through incentivizing diets that are unbalanced especially regarding the frequency of consuming micronutrient-rich foods.
How to reform food subsidies for better nutrition outcomes?
In June 2014, Egypt’s new government began to fundamentally reform the food subsidy system with the aims of alleviating its considerable and rapidly growing fiscal burden on the country’s budget and increasing its effectiveness as a social protection instrument. The recent changes mark important steps toward a voucher-based system and provide the basis for implementing a more targeted approach. Although nutrition concerns may have played no (decisive) role in the reform debate, the already implemented modifications and especially the changes to the ration card program can be expected to have positive dietary effects. They tend to reduce—but not fully remove—the incentives for over consuming calorie-rich and micronutrient-poor diets.
Policy Implications?
Given Egypt’s persistent and exceptional nutritional challenges, future food subsidy reform steps should consider nutritional implications from the onset. In fact, there may be scope to transform the current subsidy system into a key policy instrument in the fight against malnutrition.
- Change the incentives; food subsidies for all non-inferior, calorie-rich foods (subsidized under the ration card program) should be cut to reduce the incentives for their overconsumption, alternatively, micronutrient-rich foods may be subsidized to incentivize nutritious and diverse diets
- Enhance targeting tools; so that the overall costs for food subsidies can be better controlled, food subsidies be better targeted to the needy population and phased out for those who are not poor and do not need subsidies
- Reintroduce benefit differentiation corresponding to beneficiaries’ neediness;(i.e high assistance level for the neediest portion of the population and reduced assistance level with a more narrow basket limited to key nutritious foods for the less needy ones)
Follow-up impact evaluation studies will be critical to see how the new system works and where it may need improvements. In addition, more evidence on income, dietary, and nutritional implications of potential additional reform steps can help to create an optimally targeted and more nutrition-sensitive social safety net in Egypt.
Stay Tuned For The Forthcoming Book…
