Experts and consumers are not yet satisfied with the new government procedures to alleviate the ongoing bread crisis, Mona El-Fiqi investigates For weeks now, most consumers have been having a hard time to buy subsidised baladi bread at PT5 a loaf. One has to stand for hours in a long queue in front of the bakery to buy this staple food, especially if you are poor and cannot afford bread alternatives such as pasta and rice. Due to hikes in the international prices, local prices for rice and pasta doubled and tripled, respectively, in the past few weeks. Laila Mahmoud, a housewife and mother of three, said that pasta is now beyond her budget since its price rose from LE1.6 to LE4.6 per kilogramme, while rice increased from LE2 to LE4 per kilogramme. "I can buy 20 loaves of subsidised bread at LE1, while one pound is not enough to buy 250 grammes of pasta," revealed Mahmoud. Hence, the demand on subsidised bread has jumped markedly and bread lines have become commonplace across the country. In response to continuous complaints by consumers, the government began to apply some measures to deal with the problem. On Sunday, Prime Minister Ahmed Nazif assured that the government will be able to end the bread crisis within the coming six months. Minister of Social Solidarity Ali Meselhi decided to increase the quota of subsidised flour in population intense governorates. Meselhi announced that bakery owners who resell subsidised flour on the black market will be severely penalised and will be taken to the criminal court. Moreover, some governors ordered the reopening of bakeries which were previously shut down for violating regulations. Opening these outlets will help minimise crowding in front of bakeries. Other government measures included the separation of the production and distribution processes of subsidised bread. With this decision, bakeries are no longer responsible for selling bread; they produce bread according to their quota of subsidised flour and deliver it to a state-owned company which sells it. This move aims at fighting smuggling subsidised flour onto the black market. The Ministry of Social Solidarity established Al-Masriyeen Company, with a capital of LE50 million and hundreds of outlets, to be responsible for bread distribution in Greater Cairo. The model of separating the two processes has already been applied in the 6th of October City as well as the districts of Helwan and Al-Zeitoun. Adel Fathi, a supervisor at one of Al-Masriyeen's outlets in Al-Zeitoun, said sales there reach 23,000 loaves of bread daily. "We begin selling at 6am and run out of bread at around 4pm," stated Fathi. The supervisor explained that this outlet is responsible for selling the production of one bakery in the district whose quota is 23 sacks of 100 kilos of subsidised flour, making 23,000 loaves of bread. But this output still seems too few. Thoraya Ahmed, 50, came too late at 4:14pm and went home empty handed. "I just got back from work, so I missed my chance of buying bread. What can I do?" Ahmed pondered as she walked away. But Islam Ali, another destitute bread hunter, was adamant in buying the staple food. Although he was turned away at the outlet, the young man hurried to another which had not run out yet. While the government's intention of separating the production and distribution processes was to eliminate bread lines, Al-Ahram Weekly found that the queues were transported from the bakeries to Al-Masriyeen outlets. Obviously, the measures were not enough, therefore President Hosni Mubarak held two urgent ministerial meetings last week to discuss the bread crisis. Mubarak told the ministers that the government is committed to providing a limitless supply of subsidised baladi bread to all citizens. According to him, the problem is not one of funds since the subsidy budget is available, in addition to LE4.7 billion which will be directed to flour subsidies this year. He asserted that the problem lies in bad administration and the lack of control over bakeries. In the meeting, Mubarak decreed that the separation model should be applied in all governorates as soon as possible to put an end to bread lines. Another result of the meetings was to decentralise decisions relating to the bread issue. This gives each governor the right to take the necessary measures to fight bread queues in his governorate. While the government believes the separation model is the best solution, experts are sceptical. Doha Abdelhamid, professor of economics at the American University in Cairo (AUC), argued that although separating the production and distribution processes was a good idea, it has many loopholes in its application. "It is not a radical solution for the problem since those responsible for selling bread, due to their small salaries, might be bribed by bakery owners to violate regulations," Abdelhamid said. She also doubts that the government will be able to provide subsidised bread in a sustainable way without raising its price. "By raising the price of bread, the government can afford buying wheat at higher international prices," she stated. Alternatively, Abdelhamid suggested that the government change its agricultural policy to expand the cultivation of wheat to achieve self- sufficiency, especially that the cost of wheat is expected to continue rising. Egypt imports seven to eight million tonnes of wheat annually, which represents 55 per cent of local wheat consumption, estimated at 14 million tonnes annually. According to this economics professor, the government should target sales of subsidised bread to the poor because leaving it open to everyone only aggravates the problem. She also suggested that the government reconsider the new contract signed in 2006 between the Ministry of Social Solidarity and bakery owners, by which the price of flour is reduced from LE30 to LE16 per sack of 100kg. But what happened, continued Abdel-Hamid, is that this encouraged bakery owners to sell the subsidised flour on the black market. This is especially true since the price of a 100kg sack of flour rose to LE220 in the market. Some experts believe that the government's measures made matters worse. Nader Noureddin, professor of agricultural resources at Cairo University, asserted that some decisions amplified the problem. A year ago, Meselhi decided to redirect 100,000 tonnes out of the monthly 700,000 tonnes of subsidised flour to the production of bigger and better baladi bread to be sold at PT25 a loaf. Noureddin stated that this decision reduced the supply of subsidised bread by more than 10 per cent. He added that some governorates such as Minya, Assiut and Sohag, which have lower rates of income, complained that this decree harmed the poorer strata. Another mistake, according to Noureddin, is that bakeries are not given enough subsidised flour to produce the amounts of bread needed to make a profit. A bakery should work for 12 to 18 hours to gain an acceptable profit margin, he stated. This expert is convinced that the number of bakeries is sufficient, but the problem is bad organisation. His solution is that half of the 17,000 bakeries across the country should start making bread at 7pm and begin selling at 6am. Meanwhile, the other half should start baking at 6am and open their doors for customers at 2pm. "If this strategy is adopted, bread will be available for everyone at any time and bread lines will disappear," Noureddin concluded.
