New fuel prices to save LE40B for food subsidies: PM

CAIRO – 29 June 2017: The government’s decision to apply further hikes in fuel prices comes to redirect state funds to food subsidies, Prime Minister Sherif Ismail said in a Thursday press conference.

“The current phase in the economic reform program can’t allow us to delay needed decisions,” Ismail said, adding that total subsidies in the new fiscal year will record LE 333 billion ($18 billion).

Ismail said the public debt is targeted to be slashed to 95 percent in the state budget for FY2017/18 (to start July 1), while the budget deficit is planned to record 9.1 percent of GDP, down from around 12 predicted in the current fiscal year.

Minister of Petroleum Tarek El-Molla announced that fuel subsidies will stand at LE 110 billion in FY2017/2018, adding that new decisions will save around LE 35-40 billion.

Both electricity and fuel subsidies in the new budget are expected to register LE 200 billion, compared to around LE 135 billion in FY2016/2017, Minister of Finance Amr El-Garhy said earlier in May.