Rural poverty in Armenia

Little more than a decade ago, the Armenians had to face the hard facts of poverty. After the break-up of the Soviet Union at the end of 1991, the predominantly industrial country of Armenia was suddenly forced to feed itself and rebuild its economy. The agricultural sector was relatively marginal, state-owned industries were shutting down and masses of newly unemployed found themselves with no source of income. An influx of international aid staved off famine, but poverty put down deeper roots in the new republic.

In the early years of independence the country enacted radical economic reforms, eliminated subsidies on essential goods and made drastic cuts in social services. Wage earnings declined sharply. Armenians were generally poorer and had a lower standard of living.

People who abruptly lost their livelihoods in other sectors found a vital safety net in agriculture, which provided some food security and at least partial employment. More than a decade later, poverty in Armenia is still widespread, deep-rooted and severe, according to surveys conducted by the government and the World Bank. And despite recent economic growth the income gap is widening. A relatively small proportion of people prosper, while most struggle to stay above the poverty line. Many do not succeed. About half of Armenians live in poverty and two out of ten of them are extremely poor. Rural people are particularly vulnerable.

The single most important source of non-farm income is the seasonal migration of male workers to other countries in the Commonwealth of Independent States. Male migration leaves women alone to shoulder the burdens of caring for the family and the household. One out of three households in Armenia is now headed by a woman, and the trend is on the rise, especially in rural parts of the country. Households headed by women are likely to be the poorest households.

Where are Armenia's poor people?

Poverty is almost evenly distributed between urban and rural areas in Armenia. The country's poorest people are concentrated along the nation's borders, in mountain areas and in earthquake zones. Shirak in north-eastern Armenia and Lori and Kotayk in the central part of the country are among the poorest provinces.

Why are rural people poor?

Armenia was the first former Soviet Union country to dismantle its 600 huge collective farms and distribute agricultural land to individual households. More than 330,000 small-scale farms were created overnight to ensure a minimum, basic food supply and to absorb workers from now-extinct industries. Many new farmers were allotted land in mountain areas where harsh natural conditions severely restrict productivity. And many of them did not have the technical knowledge and skills they needed to cultivate the land efficiently. Technology and infrastructure such as farm machinery and irrigation inherited from the pre-transition period was useless to small-scale farmers. The technological heritage of the collective farms was not suitable in terms of scale, cost and service requirements, and much of it was obsolete as well.

Agriculture in Armenia still suffers from a crucial lack of the information, tools and institutions farmers need to operate efficiently in a market-oriented rural economy. Farmers are also adversely affected by a lack of strong and consistent government policy, regulations and coordination.

Source: IFAD