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Monday, 15 April 2019

Egypt’s gov’t still studying lower energy prices for factories

Gov’t studying lower energy prices for factories? The government is looking into revising the price at which it sells energy to factories, Deputy Planning Minister Ahmed Kamaly said yesterday at a trade and industry-focused event, according to Al Mal. The minister’s statements were likely in response to calls by the Federation of Egyptian Industries for lower prices. “It is imperative to reduce [natural gas and electricity] prices to factories, especially those producing cement and metals,” the FEI customs and taxes committee head Mohamed El Boha said during the event.

Wait, remind us why it’s a good idea for us all to subsidize energy for industry? The sector has for years been lobbying for cheaper gas. The Ismail Cabinet suggested steel industry players could get a reprieve, but this never materialized. A more recent pledge was also attributed to Prime Minister Moustafa Madbouly by 10th of Ramadan Investor Association boss Samir Aref, who said claimed that manufacturers pay between USD 2-3 / MMBtu more than the global average. The government took a step to please the industry last year when EGAS introduced more flexible payment terms and eliminated the 2.5% surcharge on overdue gas bills.

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