Minutes after Egyptian Prime Minister Mostafa Madbouly announced today, Wednesday, the increase of the bread loaf price by 20 piasters for the first time in over 30 years, the hashtag "subsidized bread" topped the "X" platform in Egypt and several Arab countries. The application will take effect within two days, as the Egyptian government decided to raise the price of the subsidized bread loaf to 20 piasters starting from the first of June next year.
The Prime Minister acknowledged that this decision "may not be well-received as it is a sensitive issue." He explained that "the price of subsidized bread has not changed for 30 years," and added that the Cabinet discussed today attempts to slightly reduce the subsidy. He stated that support will continue to assist low-income groups.
Meanwhile, social media users considered the decision unprecedented and harmful to those with limited income amidst ongoing price increases. One user remarked, "Isn’t it enough to raise prices? Where will we get it from?" Another added, "Why are you getting closer to the poor's bread?"
Regarding "massive increases in prices," the Prime Minister had previously stated that while the bread loaf will remain subsidized, its price should align with the "huge" price hikes. He noted that a study is underway to govern subsidies and devise a better plan by the end of 2024. The subsidy bill for the next fiscal year is set to reach 636 billion Egyptian pounds, reflecting a 20% increase compared to the current fiscal year.
On debt repayment, he said, "Extracting natural gas from Egypt's land costs the state $4.25 and is sold to electricity at $3. We will pay between 20% and 25% of the foreign partners' arrears next week."
Egypt's annual consumption of petroleum materials reaches $55 billion, with over 60% of the natural gas produced in Egypt allocated for electricity consumption, according to Madbouly. He disclosed that the monthly fuel bill for electricity plants amounts to 15 billion pounds, while the Ministry of Electricity only pays 4 billion pounds of that. The cost of producing one kilowatt-hour of electricity is approximately 223 piasters.
