The Madbouly government is working to insulate beneficiaries of its subsidy programs from rising food prices in the wake of last week’s fuel subsidy cuts. The government will pay 15% more for transport providers who haul the food and petroleum products it buys under the subsidy program after recent fuel price hikes, Social Solidarity Minister Ali El Moselhy said, according to Al Ahram. El Moselhy said the government will effectively absorb the new cost to transport companies to maintain prices of subsidized goods. The ministry will also be covering the difference in the cost of subsidized bread, which sources previously said would cost state coffers and additional EGP 5 bn, as well as the transport of wheat.

Food prices in the private sector could rise 3-7% over the coming months on the back of higher fuel costs, the government has previously said. Other goods and services such as construction and building materials, cars, and electronic appliances have also risen in price. Public transport services including buses, white cabs and Ubers have also seen prices increases over the past week in response to the government’s decision to raise fuel prices by c. 50%. The hike is the third since the government signed a USD 12 bn Extended Fund Facility agreement with the IMF in 2016.