(December, 2006)
The purpose of this paper is to explain observed growth over the period 1990/91-2004/05 and to determine whether it has been associated with improved distribution leading to a significant reduction in poverty; or whether growth has been combined with deteriorating income distribution, dampening or even reversing the growth effect on poverty. The analysis proceeds along three levels: the macroeconomic level, which considers the growth experience of Egypt over the past fifteen years; the sectoral level, which addresses the pattern of growth of various sectors of activity as well as the poverty levels in these sectors; and finally the household level, which studies the pattern of distribution and poverty indicators for various expenditure groups. In light of the analysis, the paper stresses that economic growth alone is not sufficient to achieve the goal of poverty reduction; countries that have combined rapid growth with improved income distribution have reduced poverty the fastest. To conclude, the paper highlights specific policies and strategies that would simultaneously lead to high and sustained GDP growth, more equitable distribution and a rapid reduction in poverty.