Egypt is set to allocate $2.66 billion for bread subsidies and $3.13 billion for petroleum products subsidies in its 2024/2025 budget, as announced by Mohamed Mait, the country’s Finance Minister.
Being one of the largest importers of wheat globally, Egypt also imports other essential food items and fuel. Currently facing foreign currency constraints, significant budget deficits, and imbalances in payments, the country aims to address these challenges through strategic financial planning.
Mait disclosed that a total of $12.67 billion has been earmarked for social protection programs, with a particular focus on allocating 134 billion Egyptian pounds for food subsidies.
Egypt’s subsidy program ensures subsidized prices for staples like bread, rice, and sugar, benefiting nearly 60 million out of the country’s total population of 105 million.
The decision to subsidize petroleum resources stems from the escalating global oil prices and the repercussions of fluctuations in foreign exchange rates.
Recent economic measures include allowing the Egyptian pound to devalue, reaching approximately 47 pounds to a dollar in March, alongside a substantial increase in key interest rates by 600 basis points. The country’s currency is presently pegged at around 31 pounds to the dollar for a duration of 12 months.
Looking ahead, Egypt forecasts total expenditure to reach 3.9 trillion pounds ($82.89 billion) in the upcoming fiscal year, commencing July 1st, with projected revenues estimated at 2.6 trillion pounds.
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