2.0 Gender in the PRSP and its relationship to the national budget in Egypt.

• Position: Gender Dimensions of PRSP Processes and the Relationship to the National Budgets: The Experiences of Egypt, Mali, Rwanda, Uganda and Zambia - Poverty reduction strategies and plan

2.1 A gender analysis of indicators for the key PRSP sectors.

Egypt is a medium human development country. However, 19.6% of the population was classified as poor in 2004, with 7% being considered ultra poor.

There is a remarkable uniformity among the frameworks of the previous poverty reduction strategies and plan in Egypt, which are based on the four areas considered to be key to poverty reduction (generating job opportunities, human capital, social protection, and increased access to basic services). These are the four areas to which the gender analysis was applied.

2.1.1 Social Safety net

The status of female-headed households in Egypt illustrates women's vulnerability to poverty. Female-headed households in Egypt are estimated to make up about 22% of households. Most studies on female-headed households found that employment is a mechanism for coping with household poverty and with the increasing cost of living.

This trend accompanied with an increase in the prices of food, electricity and transportation due to the reduction in subsidies led to an increase the cost of living and no poor women could afford to stay at home. Work is not to achieve self dependence but rather enforced due to economic reasons and led to role conflicting. The need for a steady flow of an income as a buttress against insecurity of unemployment and inadequate or nonexistent financial support from male partners and kin networks was a major factor pushing women to develop a variety of strategies to increase their incomes. Moreover early motherhood resulted in many women who are compelled to seek income because they have to support their children. Strategies to improve the livelihood are similar among poor classes. Strategies ranked from seeking employment, taking an extra job producing home handicrafts for sale and networking among kin and friends to obtain extra money. As most female headed households are poor and uneducated they were absorbed in the informal sector with no protection and significant wage differences (EL Solh, K. 1994).

The WB Gender Assessment Report 2003 concluded that poverty rates across male and female-headed households are fairly similar. In urban areas female-headed households experience greater poverty rates than male-headed households. In rural areas, where the bulk of poverty exists, the opposite is true. However, Women headed households tend to have different characteristics than male-headed households. Women heading households are older than males, are less likely to participate in the labor force, and are more heavily dependent on income transfers from pensions and remittances. In addition, most women heading households are illiterate, which imposes more challenge in front of them to get a good paid job. Moreover, children in these households are more likely to be illiterate and more likely to work.

It is worth mentioning that Female Headed Households in fact comprise a heterogeneous group, including: elderly widows residing in small households, supported by pensions; households supported by remittances from a male breadwinner working away from home; and female breadwinners supporting families through their own earnings, rather than income transfers. The first two groups of households are relatively well-off, while the third are often among the poorest of the poor.

Income from government pensions is the second most important source of transfer income, accounting for 19.7 and 6.8 percent of income received by poor urban and rural FHHs respectively. While FHHs are highly dependent on government pensions, they do not benefit in proportion to their numbers. Although they are highly dependent on this source of income, poor FHHs only collect 1 percent of all pension funds dispersed by the government.

Government pensions are unequally distributed for two reasons. First, men, because of their higher labor force participation rates, are twice as likely to receive government pensions. While women are less likely to have access to government pensions because of their own labor history, they do qualify for pension funds as widows, if their husbands were eligible. But survivor benefits tend to be smaller than the benefits going directly to the pensioner. In addition, since the poor are less likely to be employed in the public sector, they are not generally eligible for government pensions. As a result, the non-poor, who represent 83.3 percent of the population, receive almost 96.6 percent of government pension funds, whereas the poor receive only 3.4 percent.

2.1.2 Job Creation: Generating productive opportunities

Unemployment is estimated by 9% in 2006. Underemployment and reliance on the informal economy (often estimated at one third to one half the size of official GDP) are also major features of Egypt's economy. Government and private estimates put the number of job seekers entering the labor market annually at anywhere from 700,000 and 800,000.

[FIGURE 2.1 OMITTED]

Egypt's current employment problem is characterized by inadequate labor absorption of graduate students and under utilization of unskilled human resources. Additional problems are overstaffing in the government sector, coupled with shortages in skills, and negative implications for employees' productivity (Nassar, H. 2006). The labor force (15+) reached 30.1% of total population. In accordance to official figures females represent 28 percent of the labor force (15+). The services sector absorbs the largest share of the labor force (48.6 percent) followed by the agricultural sector (30.4 percent), then the industrial sector (21 percent). Given the fact of the limited capacity of the formal private sector in providing enough jobs, the informal sector -often estimated at one third to one half the size of official GDP- is playing an increasing role in providing employment opportunities.

Unemployment rates for women are much higher than rates for men. The overall rate of unemployment reached 11.2 percent in 2005. However, while men's unemployment rate was 7.1 percent, women's was 25.1 percent. (CAPMAS, 2006).

Unemployment among both males and females in Egypt is characterized by three significant features; young, educated, and first time job-seekers. In 2005, the majority of both males and females (about 92 percent) are between the ages of 15 and 29. The age category (20-24) faces the highest level of unemployment among both males (48.1%) and females (47.4%). Looking at the educational level, the highest two educational categories suffering from unemployment are secondary (63.7% among males and 72% among females) followed by university graduates (27.9% among males and 25.9% among females). (Annex Tables E1 and E2)

The gender analysis is therefore under 3 themes of:

* Women in MSMEs

* Women in agriculture, and

* Women in the informal sector

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1. Women in Business and SME's

   The distribution of entrepreneurs from a gender perspective reflects a strong bias against women, while about one third of working men are entrepreneurs (self employed and employers); the percentage reaches 16% only among women. Women tend to concentrate in micro self employed enterprises (14%) while the ratio of women employers does not exceed 3%(table 2.1)

   According to 2006 Egyptian Labor Force Survey statistics, there are some 630,000 woman-owned micro and small enterprises (MSEs) in Egypt. Of the total MSE population, women make up less than 17 percent. This means that men outnumber women by a ratio of more than 5 to 1.

   One of the major factors influencing the level of women's entrepreneurial activity is the low participation rate of women in the workforce, which is low in Egypt. Not being in the workforce at all means that women do not have much opportunity to gain business skills and experience or to be exposed to ideas for developing products and services to fill unmet needs or gaps in the marketplace.

   Findings from a comprehensive survey of the MSE sector carried out in 2002 and 2003 by the Economic Research Forum (ERF) suggests that, compared to male-owned MSEs in Egypt, women's enterprises are started with a considerably lower level of capitalization; are more highly concentrated in the trade sector (where barriers to entry are low); more likely to have only one worker; more likely to have outside establishments in the informal sector; and less likely to be exporting. In addition, they have less access to formal technical, business management, and entrepreneurial training, business development services (BDS), and finance, coupled with a lower average level of education and higher illiteracy rate than men. In the MSE sector, only 3% of male-owned enterprises have over 10 employees, for women owned enterprises, it is less than 1%. But this means that close to 60,000 of the 630,000 women-owned MSEs are in the small enterprise category (with between 10 and 49 employees)

   Women entrepreneurship in Egypt faces several challenges including limited finance, lack of assistance to product development; marketing and access to business information as main growth constraints. In addition, large and small businesses alike cite tax rates, macroeconomic as well as regulatory uncertainty and corruption as their top concerns about the business enabling environment. Both women and men identified regulatory and administrative barriers as another prohibitive factor to MSME growth. Although the laws pertaining to MSMEs are relevant to all owners, regardless of gender, the impacts of these requirements affect men differently than women because of the "traditional gender paradigm".

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1. Access to Finance. According to the Egypt GEM Assessment, women owned an estimated 10-17 percent of small businesses in 2003. Findings of the Egypt investment climate assessment (ICA) show that women have less access to finance than men, and the small number of the banks' businesswomen clients are typically micro-entrepreneurs. Only 5 percent of businesswomen had successfully accessed financial resources...