Egypt will allocate $2.66bn for bread subsidies in its 2024/2025 Budget and $3.13 billion in petroleum products subsidies according to a statement by Mohamed Mait, the country’s Finance minister.
According to Reuters, Egypt is one of the world’s biggest importers of wheat and also imports other basic food and fuel. The country is currently going through a foreign currency crunch, a gaping budget, and balance of payments deficits.
A total of $12.67bn was allocated for social protection programmes, including 134 billion Egyptian pounds for food subsidies in particular, Mait added.
Egypt’s subsidy program provides subsidized prices of items like bread, rice and sugar to nearly 60 million Egyptians out of the total population of 105 million Egyptians.
Egypt’s finance minister added that the subsidizing of petroleum resources was as a result of a rise in global oil prices and also the impact of foreign exchange rate changes.
Egypt let its pound slide in March to about 47 pounds to a dollar. The central bank also hiked key interest rates by 600 basis points.
Egypt’s currency is currently fixed at around 31 pounds against the dollar for 12 months.
According to the finance minister, Egypt’s total expenditure will reach 3.9 trillion pounds($82.89b) by the upcoming fiscal year starting July 1st.
The revenue is expected to be at 2.6 trillion pounds.
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What to Know
- Egypt recently signed an $8 billion expanded loan agreement with the International Monetary Fund (IMF).
- The world bank has also pledged to support Egypt with $6bn in the space of three years.