IPS-English EL SALVADOR: Progress in Fight on Poverty Called Date: Thu, 05 Jul 2007 14:42:54 -0700 ROMAIPS LA DV IF PR MD EL SALVADOR: Progress in Fight on Poverty Called into Question Raúl Gutiérrez SAN SALVADOR, Jul 3 - Although the government of El Salvador triumphantly holds out statistics reflecting a reduction of chronic poverty in this Central American country, local and international experts have joined their voices with those of common citizens to cast into doubt the validity of the official figures. ”It's pretty tough. Sometimes we only eat once a day, and that's when I've found work,” Juan Villanueva, who lives in a slum neighbourhood on the outskirts of San Salvador, told IPS as the United Nations Development Programme (UNDP) presented the results of a report on poverty reduction. Experts and representatives of civil society, as well as the author of the UNDP report, recognise that the study raises doubts about the parameters used by the government to measure poverty. The experts consulted by IPS argued that not only has poverty not been reduced; it has actually increased. They say the official Consumer Price Index (CPI), tweaked for the government's convenience, along with statistics on remittances sent home from Salvadorans abroad, paint a deceptive picture. UNDP economist Carlos Acevedo, the author of the report, told IPS that the study took a ”diplomatic” approach, reporting that poverty had declined, but also pointing out that this was a result of how the economic variables were measured. The report, based on government data, says the proportion of households in poverty dropped from 31.5 percent in 1991 to 22.8 percent in 2005, while the proportion of households in extreme poverty shrunk from 28.2 percent to12.3 percent. But figures from the Economic Commission for Latin America and the Caribbean (ECLAC) reflect a very different reality. According to the regional U.N. agency's ”Social Panorama of Latin America, 2006” report, in 2004 (the last year for which statistics were available), 40.4 percent of households were below the poverty line and another 15.6 percent were extremely poor. ”What is suspicious about this national poverty line is that it reflects a gradual decline in the cost of the basic food basket, so that today it is supposedly much cheaper than 10 years ago, which is something that people don't believe,” said Acevedo. According to the official statistics, the basic basket of consumer items cost 143 dollars in 1996 for a family of four and 137 dollars in 2005, in urban areas, while it cost 110 and 88 dollars, respectively, in rural areas. But, said Acevedo, all that has to be done is adjust the price of the consumer basket based on the evolution of food prices under the CPI to determine that its actual value is 212 and 148 dollars for urban and rural areas, respectively. The minimum monthly wage in urban areas stands at 170 dollars and the basic consumer basket only includes essential food items, while excluding services like electricity or a telephone line, or the cost of sending children to school, for example. Villanueva, who lives in the Lomas de Mariona slum, eight kilometres from the centre of San Salvador, said the government's figures are ”total lies.” It is clear that he is familiar with extreme poverty, which has made this 55-year-old man look quite a few years older. He and his wife Antonia have seven children, ranging in age from two to 12 years old. They live in a partially ruined house in which they have neither water nor electricity. The children, who do not attend school because their parents cannot afford to send them, take turns going for water to the ”Cantarera”, a public water faucet half a kilometre away from the house. Meanwhile, Juan seeks out casual work of any kind, along with his sons Oscar, 12, and Jesús, nine. Through the ”Solidarity Network” programme created by the Salvadoran government in 2005 to fight poverty, needy families in 32 towns in rural areas receive a stipend of 15 dollars a month. So far, four million dollars have gone into the programme. Mario Paniagua, executive director of the Intersectorial Association for Economic Development and Social Progress (CIDEP), said he did not find the UNDP report's figures convincing. Paniagua said that warnings had been issued for years that the methodology used for measuring poverty has gaps, particularly because the prices of the food basket have not been updated. Furthermore, as a result of the high rates of emigration, the government has turned expatriate remittances into ”a national strategy for fighting poverty,” he said. In 2006, El Salvador received more than 3.3 billion dollars in remittances from emigrants, equivalent to 17 percent of gross domestic product (GDP), according to Central Reserve Bank (BCR) figures. Figures from the Central American Resource Centre (CARECEN), established by Salvadoran immigrants in the U.S. state of California, show that some 700 Salvadorans leave the country every day in search of jobs and decent wages mainly in the United States, where 2.3 million of the 2.5 million Salvadorans living abroad reside. Acevedo agrees with Paniagua. ”My hypothesis is that poverty is being reduced basically thanks to emigration and remittances,” he said. Just the fact that the poor are leaving the country brings down the poverty rate, without taking into account the remittances that they then send their families, which help them climb above the poverty threshold. The UNDP says the real impact of remittances is underestimated, because household surveys do not reflect even one-third of the inflow of money reported by the BCR. ”Without the remittances, the poverty rate could be 20 percent higher,” said Acevedo. ***** + DEVELOPMENT: Uneven Results Forecast for Millennium Goals (http://www.ipsnews.net/news.asp?idnews=38399) + DEVELOPMENT: Latin America Ahead on MDGs - Except for Poverty (http://www.ipsnews.net/news.asp?idnews=38408) (END/IPS/LA DV PR IF MD/TRASP-SW/RG/JSP/07) = 07040719 ORP006 NNNN