Egypt signs deal with Euroclear to boost domestic debt management    Erdogan says Turkey to resume Syria offensive if truce deal falters    Spanish government dismisses call for Catalan talks; police brace for more unrest    Egypt's Cooperative Insurance Society to cover NGOs clients' loans    Angry over Brexit, thousands gather in London demanding new referendum    After a young pupil dies of meningitis in Egypt, tips to help prevention    Live score: Zamalek v Arab Contractors (Egyptian Premier League)    Irish clubs set to meet to discuss a new cross-border league    Bulgaria coach Balakov resigns following racism fallout    Wide protests in Lebanon against ruling elite over economic corruption    U.S.-China trade deal will be signed by middle of November: Trump    Egypt's PM urges US's ADTRAN Inc. to invest in communications equipment    World Bank launches human capital investment plan in MENA, North Africa    French President Macron receives Egypt's Coptic Pope Tawadros II at Elysee    Oil prices drop as China slowdown weighs    Egypt urges its citizens in Lebanon to exercise caution as protests continue    Egypt says strategic wheat reserves enough to cover its needs until February    Egypt keen to support DR Congo: Ambassador    Cairo metro back to normal operations following hours-long power disruption    Egypt's Pope Tawadros opens Saint Mary, Mar Youhanna Church in Belgium    Egypt's Irrigation minister reviews latest developments of Ethiopia's Renaissance Dam in Budapest    'Passports should be valid for six months,' Egypt's foreign ministry advises citizens planning travel abroad    Unpaid work hits 35% of Egypt's GPD, but still not included in economic calculations: IMF    Grand Nile Tower Arts & Cultural Centre launches second round    Egypt's coach Hossam El-Badry satisfied with winning start despite technical problems    Hundreds released    Luxor's new discoveries    Moroccan film Nomades scoops awards in Alexandria Film Festival    Toshiba's JV with Egyptian Elaraby opens regional HQ in South Africa    Six authors vie for Booker prize 2019, Atwood in the lead    In Photos: A sneak peek into rehearsals for the Cleopatra ballet world premiere    Sisi, Ethiopia's PM to meet in Moscow to discuss GERD issue    Sisi: army engaged in attrition phase against terrorism in Sinai since 2013    10K fans to attend Egypt's friendly against Botswana in Alexandria: EFA    Sisi, Ethiopia's PM agree to overcome obstacles in Nile dam talks    Farwell to Egyptian comic actor Talaat Zakaria    Court sentences six to death, 41 to lifetime imprisonment violence related case    Trump says he would release Mideast peace plan after Israeli elections    ACWA Power compares 3 bids to supply production units for Luxor power station    What do you know about gold alloying?    NBE announces EGP 2.5m prizes for handball youth teams for their world achievements    Jennifer Lopez evokes Egyptian outrage post her North Coast performance    Al-Sisi honours Egypt's scholars on Science Day    IS claims responsibility for suicide bombing killing 63 in Afghan wedding    Political parties gear up for parliamentary, senate, local elections    Unprecedented Glory: Egypt win Men's U-19 World Handball Championship    12th National Egyptian Theatre Festival fuel up public theatre art scene    Ministry of Environment has a plan for "black clouds season"    

Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.

Fuel subsidies hurt industry, Egyptians alike: head of Petroleum, Mining Industries Chamber at FEI
Published in Daily News Egypt on 20 - 01 - 2019

For the Federation of Egyptian Industries (FEI), considering fuel subsidies was a significant step toward genuine economic reform which began with the floatation of the Egyptian pound, putting Egypt on the threshold of the required economic growth.
The head of Petroleum and Mining Industries Chamber at the FEI, Tamer Abo Bakr, informed Daily News Egypt that fuel subsidy allocations are not in favour of the citizen and the industrial sector alike, thereby it did not enhance the Egyptian economic performance as well.
"Fuel subsidies have been allocated since the 70s, reaching its hike by EGP 150bn during 2016, and we called the government time after time to phase out these subsidies and redirect them to improve other weak, suffering sectors but with no response. President Sisi has taken this daring step which definitely will help the economy to grow, and the market to flourish", Abo Bakr said.
He estimated that the liberalisation of 95 octane gasoline in March is to pave the way for dissolution of 92 octane gasoline, as countries all over the world have stopped using 80 octane and 92 octane gasoline and even 95 octane gasoline since several years, and currently use 98 octane gasoline instead.
"Although it is important to phase out fuel subsidies gradually, and the government was successful it its mission in this regard until now, it requires some important procedures to provide this step with the ultimate standard of success. First, this sector has to be controlled through an independent authority, and not to follow any executive body including the ministry of petroleum and mineral resources, as it will enhance the sector and boost the economy. Second, the time factor is the perfect time to set fuel prices, in order to follow the Brent crude oil global prices which are cheaper now, allowing fuel prices in our market to increase or decrease according to Brent prices. And eventually, we have to stop comparing fuel prices in Egypt with their counterparts in other countries because of the big differences between us and them in various levels. These steps must be taken to achieve a real reform in this sector, and not simply as mandatory charges", he revealed.
The state, as Abo Bakr continued, has to set a qualified database to protect the low-middle income category, to help it to gradually adapt to the phasing out of the fuel subsidies until its complete eradication, as it will undoubtedly serve the national economy to develop.
What complicates the situation even further is the implementation of the floatation of the Egyptian pound and the concurrent phasing out of fuel subsidies without giving the floatation of the Egyptian pound the chance to be assimilated by the domestic market and citizens alike. If that were to occur, the economic atmosphere, especially the industrial and tourism sectors, would have thrived in a greater manner, benefiting from the rising price of dollar. Phasing out fuel subsidies should have been applied after a reasonable period following the floatation, in order to avoid everything we are presently experiencing, according to Abo Bakr.

Clic here to read the story from its source.