Expected fuel hikes to enhance social safety net

CAIRO – 1 July 2019: Social justice is the main object of the expected hikes in the fuel prices in Egypt as the government plans to save up to 301 billion EGP ($18 billion) to support salaries in Egypt in 2019.

The expected fuel hikes would save up more than 50 billion EGP in allocations for state subsidies to enhance the safety net of the most vulnerable groups in Egypt.

About 76 million citizens in all over Egypt benefit from the ration cards that are included in the state subsidies, according to the official statements. Fuel hikes allowed the implementation of minimum wages increase from 1200 to 2000 EGP.

The hikes are believed to be a step to allocate subsidies for those who deserve them the most.

President Abdel Fatah al-Sisi declared in March the new allowances and raising the minimum wage to LE2,000 (US$ 120.08) from LE1,200.

President Sisi also said that the increases in wages and allowances cost EL30.5 billion in the new fiscal year.

The move of allowance increases coincides with a scheduled hike of fuel prices that will be applied in July in accordance with the state’s austerity measures applied following the $12 billion loan from the International Monetary Fund (IMF).