Sri Lanka income inequality cause for concern: UN

COLOMBO (EconomyNext) – Sri Lanka’s high level of income inequality is a cause for concern, according to a new United Nations report on how the island had performed in meeting the Millennium Development Goals.

"Although Sri Lanka has made considerable progress in reducing poverty and improving the living conditions of its people, income inequality has remained stagnant despite sustained economic growth," it said.

Income inequality barely shifted in the 22 years from 1990 to 2012.

The share of the poorest quintile in national consumption declined from 8.9 percent in 1990-1991 to 7.1 percent in 2006-2007, and then increased marginally to 7.7 percent in 2009-2010.

But the report said the Gini coefficients for both household income and household expenditure remained around 0.48 and 0.40, respectively, from 1990-1991 to 2012.

The Gini coefficient is a measure of the deviation of distribution of income (or expenditure) among individuals or households within a country from a perfectly equal distribution. A value of 0 represents absolute equality and a value of 1 absolute inequality.

"Income inequality has not changed, although many poor people managed to move out of poverty and improve their living conditions," the UN report said.

"While the country has done extremely well as a whole in moving people out of poverty, inequality gaps have not closed."

Sri Lanka achieved the target of halving poverty seven years before 2015, the MDG target year.

From the baseline figure of 26.1 percent in 1990-1991, the proportion of people below the poverty line rose to 28.8 percent in 1995-1996.





From 1996 onwards, poverty at the national level declined sharply, reaching 6.7 percent in 2012-2013. The target of 13.1 percent, to be met in 2015, was achieved by 2008.


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