You may be surprised to find out that Ukraine is a world leader in terms of income equality. The largest and poorest country in Europe has been ranked second most equal on Earth by CIA Intelligence Unit. Kiev-led democracy is just slightly behind another former Eastern bloc state, Slovenia.
Ukrainians are world’s leaders in income equality
The Eastern European country was assigned the second place globally for the equal distribution of income among households. In other words, the gap between the rich and the poor is one of the smallest worldwide.
The finding is based on Gini quotient, which measures the deviation of wealth distribution in a society.
The more equal is the disbursement of earnings in the state among families, the lower its Gini index.
And vice versa: For example, Sweden scored 25 points in the rating while South Africa—62.5, according to the CIA rating.
- Ukraine’s result is 24.6 points.
- The leader of the rating, Slovenia, scored 23.7.
- Another Soviet state, Belarus, is at #11 with 26.5.
- USA inequality index is 45.
- Russia‘s quotient is 42.
- United Kingdom is fairing better with 32.4.
- Canada scored 32.1.
- Australia sits at 30.3.
How it works in reality, not on paper
Unfortunately, in terms of wealth parity in Ukraine, it means that people are equally poor rather than equally wealthy. The average amount a family gets per member monthly is only USD $111, the latest 2017 data by the government’s statistics service Ukrstat asserts. Officially, average monthly wages country-wide do not reach even USD $300 (around $260 in March 2017).
Unofficially, though, experts estimate that about 40-47% of the state’s economy is based on cash. In other words, money is changing hands between providers, clients, and workers without paying taxes on sales and earnings. Thus, nearly half of the total turnover of goods and services goes undeclared, making the figures seem lower than they truly are. Many people earn only minimum salaries officially but in fact get a cash topper that is 2-3 times larger. Government employees are about the only ones that declare their earnings correctly, specialists affirm. Private companies routinely opt to pay “black wages” to workers to save on social contribution, calculated as percentage of the person’s (official) pay check.
This is why so many employees in Ukraine earn “grey” or totally “black” wages, as we previously reported. This, of course, distorts the official statistics.
But even if you added 50% on top of the numbers below, they are still extremely low for a country in Europe.
Top 10 leaders in income equality, as per CIA report
- Slovenia: 23.7
- Ukraine: 24.6
- Denmark: 24.8
- Sweden: 24.9
- Czech Republic: 24.9
- Netherlands: 25.1
- Belgium: 25.9
- Slovakia: 26.0
- Slovakia 26.0
- Montenegro 26.2
Top 10 countries with the largest inequality among families
- Lesotho: 63.2
- South Africa: 62.5
- Central African Republic: 61.3
- Micronesia, Federated States of: 61.1
- Haiti: 60.8
- Botswana: 60.5
- Namibia: 59.7
- Honduras: 57.7
- Zambia: 57.5
- Hong Kong: 53.7
The ranking was prepared by the Central Intelligence Agency in Washington, D.C., USA.