Al-Masry Al-Youm has learnt that the government has decided to start implementing the first phase of the flour 82% trade liberalization policy from July 1, 2009. Such kind of flour is used in the production of subsidized two-layered bread. An official source said the first phase would include 20% of the quantities of subsidized flour and would start with the new fiscal year (2009-2010). Its aim is to provide workers in the business sector mills with wages and incentives if none of this mill wins the tender. This will be carried out in coordination with the Ministry of Finance. The source pointed out that the government would allocate additional resources from the new state budget to restructure milling companies and develop their managements so that they may compete with private companies and get gradually out of the total protection they currently enjoy. The source pointed out that the plan to improve flour subsidy and liberalize flour trade was announced after it had been thoroughly studied. He also affirmed that workers in business sector mills would not be harmed by the plan, financially or administratively. According to him, it is the boards of directors of some mills which will be affected. In fact, if the mill does not win the tender, the incentives will only be given to the workers and not to the boards of directors. He also warned that some of these boards might try to persuade the workers that it is not like this in order to use them as a tool to put pressure so that the plan is not carried out. According to the source, the studies which have been carried out have revealed that some business sector mills have profiteered of the surplus of flour 82% (which is estimated at around 20% of subsidized wheat). According to these studies, such surplus is milled into flour 72% and is then launched in the free market at prices which are not those in the market itself, which makes it a kind of illegal profiteering. The source also pointed out that the new policy would try to benefit from all subsidized flour 82% and prevent it from being leaked in such ways or others. The source mentioned that the current flour policy – which some mills would like it to remain as such – is not supposed to bring any profit to mills. Yet, some companies have made dozens of millions of LE in profits thanks to the surplus of subsidized flour allocated to citizens. "The new policy will put an end to monopoly, guarantee the quality of flour and allow mills to store their product safely, as they will start owning flour" the source said.
