Egypt is considering adjusting the price of subsidized bread to better reflect the soaring cost of production, Prime Minister Mostafa Madbouly announced on Monday. However, he reassured the public that bread subsidies "will continue." Speaking during a tour of industrial projects in the Borg Al-Arab area of Alexandria Governorate, Madbouly emphasized the need for action. "There must be a move to make the selling price of bread commensurate with the tremendous increase in cost," he said. "Egypt produces 100bn subsidized loaves annually, and we sell the loaf for only 5 piasters, meaning that we collect EGP 5bn from total sales." This move comes as the Egyptian government grapples with a significant financial burden. Finance Minister Mohamed Maait revealed in March that Egypt has allocated over EGP 125bn to subsidize bread in the 2024-2025 budget. The current subsidy benefits approximately 70 million Egyptian citizens, constituting about 65% of the population. Addressing the Electricity Crisis In related news, Madbouly addressed the ongoing electricity outage crisis, stating, "We asked the Ministries of Petroleum and Electricity to stop load shedding by November or December at the latest." Egypt experienced an electricity crisis last July, its first since 2014, which the government attributed to a heatwave. Officials promised to resolve the issue by increasing gas pressure and ensuring the availability of petroleum materials for electricity networks. However, these promises have not been fully realized. Minister of Petroleum and Mineral Resources, Tarek El-Molla, stated on Monday that strategies are being developed to close the gap between available resources and the actual cost of providing electricity. The goal is to achieve this by the end of the year, though a specific timeframe remains uncertain due to its dependence on broader economic reform measures. El Molla acknowledged the negative impact of this gap on both citizens and the state, noting that electricity was not cut off during Ramadan or Eid. He emphasized that the government is working towards complete and sustainable solutions. The minister also highlighted the financial strain on the petroleum sector, which provides fuel supplies worth $55bn annually at actual costs of $20-22bn. This figure includes extraction and production costs borne by international companies, as well as an annual import bill of $10-12bn, which fluctuates with exchange rates and global Brent crude oil prices.
