African court representative praises Egypt's Supreme Constitutional Court for protecting rights    ERA-Egypt aims for EGP 1.5bn in sales in developers' commercial projects for 2019    Cityscape Egypt focuses on energising real estate market, re-instating confidence    Orange Egypt launches new sports service as 2019 AFCON approaches    At least three people killed in Alexandria building collapse    World Bank to participate in AfricaSan5, FSM5    People You May Know: exhibition daringly reflects Egyptian society's relationships    Egypt retrieves ancient Egyptian gilded coffin smuggled in 2011    Masurian Song and Dance Ensemble EŁK: From Poland to Egypt    Uber Egypt to pay value added tax    Abe mum on reports he nominated Trump for Nobel Peace Prize    India says two masterminds of Kashmir bombing killed in clash    Saudi Arabia denies crown prince seeks to buy Manchester United    Olympics 2020 Games can be springboard to transform Tokyo: Governor    Sanchez's Man United form will improve with a goal, says Solskjaer    Liverpool favourites against inconsistent Bayern, says Kimmich    Egypt praises US military assistance in fighting extremism: Madbouly    Shoukry heads to Ireland to attend meeting on Palestinian issue    Iran seeks good, brotherly relations with Muslim countries: Rouhani    Hearing sessions to discuss constitutional amendments will be held within two weeks    Armed forces arrest 2,770 individuals over illegal migration attempts    Yields on Egypt's T-Bills down by 0.34 - 0.83% after CBE interest-rate cut    Mastercard incorporates sound as new dimension to customer experience: Beatrice Cornacchia    The untold story of public debt    Egyptian journalist Hassanein Heikal's personal library donated to Bibliotheca Alexandrina    Fiascos and fumbles: Oscar organizers stumble to restore glory    UAE announces $1.1 bln of military deals with international companies: IDEX    (AP) Women filmmakers have record showing at Berlin Film Festival    Amid controversy: nasal spray for depression wins FDA panel backing    Bundesliga: Bayern have Dortmund in their sights, but Liverpool have Bayern in theirs    Colin Kaepernick reaches settlement on NFL collusion suit    7 extremists killed in gunfight with security forces in North Sinai    FAO warns of desert locust raids in Egypt, Sudan, Saudi Arabia, Yemen    Press Syndicate's electoral commission receives no candidacy appeals    Egypt in the heart of Africa    Egypt's police foil bomb attack in Giza: Ministry    Proposed constitutional amendments to be discussed over next two months: Egypt's house speaker    All hands on deck    AUC president to stay    Newsreel    Ismaili are back    Homegrown solutions for Africa    Reporting on change    An interest rate cut on the horizon?    The fallacy of an Arab NATO    Egypt-Africa: More agreements than trade    Open-air museum at Dendera    Colossus to be restored    







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.