Egypt Watch

Egyptian government confirms upcoming prices increase of subsidized bread

Egyptian Prime Minister Mostafa Madbouly said that his government is studying all scenarios related to raising the price of subsidized bread, stressing that “that will happen.”

Madbouly said, during a conference at the government headquarters in the New Administrative Capital, that the last time the state raised the price of bread was in 1988, when it rose to 5 piasters, and at that time the cost of making a loaf of bread was 17 piasters, while it now costs the state 65 piasters. Madbouly added, “We will study the scenarios and see how to ensure that this does not affect marginalized groups.”

The weight of a loaf of bread has been subjected to repeated reductions since 1988, until it now weighs 90 grams, down from 160 grams at the time. This is the method that governments have followed since the early nineties to reduce bread subsidy expenses, and it was implemented twice under the late President Mohamed Hosni Mubarak, and four times under President Abdel Fattah El-Sisi.

The Ministry of Supply and Internal Trade had announced early last month that a gradual lifting of subsidies on bread was being studied, in addition to introducing more complicated procedures for obtaining ration cards.

Sisi had announced in August 2021 that he would oversee a plan to increase the price of subsidized bread, stressing that Egyptians should contribute to bearing the financial burden, not just the government. He also stressed that it was time to increase the price of bread, and that it was inconceivable to maintain its current price. Sisi considers spending on subsidies as the reason for the state’s decades-long delay in development.

The allocations for subsidizing food commodities in the Egyptian budget for the current fiscal year fell to 87 billion and 222 million pounds, which is the same as what happened with the state’s support for petroleum products, health insurance, medicines, transportation, and more so with electricity.