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Government rethinks subsidies after gas crisis
Published in The Egyptian Gazette on 20 - 02 - 2010

IT'S something Egyptians rely on daily: the ambooba, the steel canister of Government-subsidised cooking and heating gas, hooked to the stove or water heater in the cramped homes of nearly everyone in this country's large population of poor.
So in recent weeks, when the butane gas cylinder stopped coming, the angry outcry spread fast.
A winter shortage has sent authorities scrambling to find a solution and has once again fuelled criticism that the Egyptian Government is unable to deal with the problems of its people. For many, it raises memories of acute shortages of cheap subsidised bread in 2008 that raised similar frustration and anger.
''Every year, this butane crisis gets a little worse, so why doesn't the Government take a stand and provide for its people,'' Mahmoud el-Askalani, a spokesman with the consumer group Citizens Against the High Cost of Living, told AP.
In Cairo's low-income neighbourhood of Bashteel this week, women helped each other balance the empty three-gallon (12-litre) cylinders on their heads as young boys pushed bicycles laden with cylinders to a governmental distribution centre, where they are supposed to get them refilled or exchange them for new ones at a subsidised price.
The crisis has somewhat eased, according to market observers. However, the scenes of long queues over the past few weeks have provided the Government's critics with fresh ammunition.
Hundreds of men and women lined up for hours into the night waiting for fuel tanks and trucks carrying cylinders to arrive. ''All the women here have walked to sit for hours hoping that a truck of butane will show up today,'' said one woman, Um Ahmed, sitting on her empty ambooba as she waited in line for two hours at Bashteel.
When the trucks did arrive, people swarmed over them, elbowing their way to grab a cylinder before they all disappeared.
In the past two weeks, local papers reported clashes between frustrated consumers armed with switchblades. Police said two people were killed in this scramble, crushed as they clung to a moving truck loaded with cylinders. On a radio show, a young boy called in saying all he hoped for was for his family to get an ambooba so his mother could cook dinner – prompting the host to mourn, ''is this what Egyptians' hopes are reduced to, gas to cook with?''
The troubles fuel what has been a frequent public refrain in recent years that the Government has grown out of touch with the population as the influence of powerful businessmen has grown. More than 40 per cent of Egypt' population of 80 million lives on less than $2 a day.
At the same time, the Government is burdened with a rickety, decades-old system
of subsidies and other benefits meant to provide cheap basics of food and supplies for the poor. The system is riddled with inefficiency and disorganisation, as well as corruption and black markets.
''The crisis of the gas cylinders embodies the Government's failure to draw up a realistic plan to resolve the problems in Egypt,'' wrote Mohamed Shordi in the Al-Wafd opposition newspaper. ''It is a simple matter of supply and demand, and the Government should simply close the gap between the two.''
The Government of Prime Minister Ahmed Nazif has said it considers replacing this system with cash subsidies, starting with the butane gas service.
The cause of the shortage remains unclear.
According to a study performed by el- Askalani's group, demand for butane only increased by eight per cent this winter, which he said shouldn't have caused such stark shortages in poor neighbourhoods in Cairo, where some were left without butane cylinders for weeks. The study found that governmental delays in paying for imported butane caused a delay in shipments sent to Egypt.
The Government, in turn, has blamed bad weather, which it said forced ports to close this month, delaying gas shipments.
The shortage was exacerbated by the black market, where factory owners buy the subsidised butane meant for home use.
The Government has ordered four more distribution stations set up to handle the spike in demand, and while residents of some areas closer to downtown Cairo claimed the crisis was slightly lifting, others are still waiting in lines for as long as eight hours in many suburbs of the city.
The shortages at distribution centres, where a cylinder costs the equivalent of about 50 cents, have forced many people to resort to the black market, where the price soars to nearly $12.


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