Cabinet to Postpone Energy Subsidy Reduction After Presidential Elections

Source: Al Masry Al Youm 4/27/2014, Location: Africa

The Cabinet is reconsidering implementing measures to limit energy subsidies on electricity, natural gas, gasoline and diesel oil until after the presidential election slated for 26 and 27 May.

Gamal Bayyoumi, adviser to the minister of planning and international cooperation, told Al-Masry Al-Youm, “It’s probable that the government’s announcement of gradual lifting energy subsidies will be postponed until after presidential elections, so that society would not be preoccupied during such an important event.”

However, he also added that “Prime Minister Ibrahim Mehleb and the electricity minister might declare news about energy subsidies, since they are tasked with making a decision on increasing the price of electricity and other derivatives of energy after mulling the issue.”

Bayyoumi added that news about donors and other countries being behind the government’s intentions to cancel the energy subsidy are untrue. "Total European, Asian and US aid represent 0.8 percent of the gross domestic product," he added.

He also denied negotiations between the government and the International Monetary Fund, especially with the upcoming elections. He added that resorting to the fund is pivotal in obtaining the trust of international investors and reassuring them over the economic reform program in Egypt.

In related news, Sherine al-Shawarby, deputy finance minister and head of the ministry’s social justice unit, disclosed plans to restructure energy subsidies within the state budget through three points, including rationing consumtion in order to prevent smuggling, controlling price movements, and resorting to renewable and alternative energy resources.

Shawarby pointed towards gradually moving to a cash subsidy, ruling out the sudden stop of the current form of subsidy. She also urged the necessity of setting mechanisms to compensate the poor and the middle class.

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Related Categories: Coal  Electricity  General  Natural Gas  Oil 

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