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Tuesday, 14 June 2022

Not shocking

No electricity price hikes coming this July, after all: The Madbouly government will freeze electricity prices to ease financial pressure on the public, which is already coping with high inflation, President Abdel Fattah El Sisi said yesterday (watch, runtime: 3:41).

Residential electricity bills were set to rise by as much as 21% at the start of the new fiscal year on 1 July, as per the government’s six-year roadmap (pdf) to restructure electricity prices by 2025. Households in the highest consumption tiers — which as of last year have not received subsidies — would have seen prices rise by up to 6%.

This is the third time we’ve delayed moving on electricity prices to protect citizens from the global macro climate, El Sisi said.

There are still around 17 mn households that are paying “subsidized” electricity prices that are around 50% less than what their monthly electricity consumption actually costs, El Sisi said, speaking during the inauguration of the livestock and dairy complex in Sadat City yesterday.

SMART POLICY- None of that subsidy coverage is coming out of state coffers: The government’s electricity price restructuring plan has introduced a cross-subsidy system in which high-consumption households are charged a high markup on their electricity prices, which is used to subsidize low-income and low-consumption households.

The same cannot be said about fuel subsidies: Egyptians also pay less than 50% of the actual price of fuel, he noted.

El Sisi wants farmers to up local wheat production: During his speech, the president said he was hoping that the local harvest would reach up to 10 mn tons, and thanked farmers who sold their wheat to the government amid the wheat supply crunch triggered by the crisis in Ukraine (watch, runtime: 2:42). “If there is a chance [why not] bring the procured wheat to nine or 10 mn from 6 mn? We don’t know where we’re heading and [how long] this thing [in Ukraine] will last,” he said.

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