Located in the Northeastern corner of Africa, Egypt is having a hard time making ends meet. The foreign currency crunch has skyrocketed the price of basic commodities and this has pushed millions of domestic people into poverty.
To lessen their suffering, the government is providing basic commodities at a subsidized rate to ration card holders. However, the dollar crunch and inflationary pressures is forcing the concerned authorities to raise the prices.
Egypt Plans To Increase Prices Of Subsidized Commodities
Egypt has a population of approximately 110 million people. Of the total population, over 60 million people are ration card holders who are primarily dependent upon the government to tame inflation. However, as it seems, the road ahead might be difficult for them.
Mr. Ali El-Mosilhy, Supply Minister of Egypt said in a press conference that after reducing the supplies of some of the imported items like wheat and vegetable oil, the government is planning to gradually increase the price of basic commodities being offered at subsidized rates to ration card holders due to inflation and dollar shortage.
Continuing further, he also said that the government is mulling over adopting local currencies in its trade. Though nothing has been decided yet, it is in talks with Russia, China, and India and is pushing them in this regard.
Woes For The People
As per plans, Egypt intends to raise the price of vegetable oil. From EGP 25 ($0.81) earlier, a bottle of vegetable oil would cost EGP 30 ($0.97) after the increase. Similarly, the prices of a kilogram sugar and rice would go up to EGP 12.60 ($0.41) from EGP 10.50 ($0.34).
All this hints that Egyptians are going to brace a tough time going ahead.
Egypt’s economy has already been crippled, and fourth consecutive time the country has taken a loan from the International Monetary Fund (IMF) in six years.
The Bottom Line
Egypt’s economy has been crippled. Struggling with a dollar crunch and inflationary pressures, the government has already turned to the international lender, International Monetary Fund (IMF) for funds. It has also implemented various initiatives to bring in foreign currency for import operations and repayments of accumulating debts. It has also eased its citizenship restrictions to invite foreigners into the country.
However, even then the North African nation has failed to avert the dollar crisis. As a result, it is now planning to raise the prices of commodities being offered at subsidized rates and if that happens, it would be difficult for 60 million Egyptians who are primarily dependent on the government for meeting their consumption needs.
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