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Monday, 23 September 2019

Egyptians to pay more for private transport services due to new fuel price hikes

As government slashes subsidies on fuel, commuters will pay more for using microbuses, taxis; no decision yet on public buses and the Cairo underground

Menna Alaa El-Din , Bassem Abo Alabass , Sunday 6 Nov 2016
 Egyptians crowd at a mini-bus in Cairo, Egypt (AP)
Egyptians crowd at a mini-bus in Cairo, Egypt (AP)
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A day after the Egyptian government slashed fuel subsidies on Thursday, raising prices by 30-47 percent, several governorates increased fares for vital privately-owned transportation means, setting the stage for new financial burdens on ordinary people.

No fare hikes on public buses or the Cairo underground system have been announced yet.

On Saturday, Cairo Governor Atef Abdel Hamid announced that there would be no price hikes imposed on public bus fares, which currently range from EGP 1 to EGP 2.

Abdel Hamid said that the Cairo Transportation Authority’s (CTA) budget would absorb the increased cost of fuel.

The governor described the decision as an attempt to not place “additional burdens on average citizens."

On Thursday, Egypt’s petroleum ministry announced fresh price hikes on gasoline, diesel, butane gas, natural gas and the low-quality fuel mazut.

The decision came hours after the central bank decided to liberalise the Egyptian pound's exchange rate against the dollar.

The price of 80-octane gasoline (the cheapest generally available) increased by 30.5 percent, from EGP 1.60 to 2.35 per litre, the ministry announced.

The price of 92-octane gasoline rose from EGP 2.60 to EGP 3.50 per litre, while the diesel price rose from EGP 1.80  to 2.35 per litre.

Microbuses

Amr Jamjoum, chief of the Cairo Project for Microbus Services, told media outlets on Sunday the project will allow microbus drivers, who carry tens of millions of Egyptians every day, to raise their rates by 25 and 50 piastres for short and long distance routes respectively.

This amounts to a 10-15 percent increase, which Jamjoum says will account for the increase in fuel costs.

Governor Hamid has called on the project to intensify efforts to ensure that microbus drivers abide by the set rates, in coordination with the transportation ministry's traffic department.

Nationwide, local authorities have begun to publish and distribute tables for new microbus fares, showing an average increase of 15-20 percent.

White Taxis

“We [drivers] haven’t set our metres yet, and I don’t know how would we do that,” Gouda Ragab, a taxi driver, told Ahram Online.

Prior to last week's price increases, the base fare for taxis in Cairo was generally set at EGP 3. Rageb said that “after the rise in fuel prices, they may be set at EGP 3.25 or EGP 3.50.”

The 34-year old driver believes that the new increases in fuel prices will seriously affect middle-income Egyptians, “especially when their salaries haven't seen any rise.”

Car-Hailing Mobile Applications

The two online taxi apps operating in Egypt, Uber and Careem have yet to decide how they will deal with the cost increases to ensure the interests of both their riders and drivers.

In statements to Ahram Online, Uber Egypt’s General Manager Anthony Khoury said they “are studying the current situation and will take the necessary decisions to adapt to changes in the market."

“We understand that the fuel price increase will increase everyone's expenses. Uber will continue to provide safe and reliable transportation as well as economic opportunities for Egyptians,” Khoury asserted.

Uber’s ‘UberX’, the low-cost Uber used mainly in Cairo and Alexandria, has a base fare of EGP 3 with an EGP 0.20 charge per minute and EGP 1.30 per km.

The Dubai-based Careem has not announced whether they will increase their fares following the gas price increases.

Careem’s General Manager Hadeer Shalaby told Ahram Online that the company has increased drivers' wages as a temporary measure to cope with the fuel price hikes.

“For now, we have only increased wages for drivers; the base rate now starts at EGP 3 instead of EGP 2, and EGP 1.45 instead of 1.40 per kilometre. For waiting, the wage has risen from EGP 22 to 23 per hour,” Shalaby said. For now, the company is absorbing the cost of the fuel price hikes, and has not raised fares for riders, he added.

For riders, an “economy” ride has a starting fare of EGP 5, with EGP 1.5 per km and a waiting charge of EGP 35 per hour.

Metro

Egypt’s Prime Minister Sherif Ismail hinted on Friday at the possibility of imposing an increase in the price of the Cairo metro system which is used by millions of commuters everyday.

No official decision on the metro has been made yet..

At a press conference to explain the government's economic decisions and their impacts, Ismail said that the price of metro tickets is too low to continue normal operations.

“The metro's revenues do not cover operational costs,” the premier told a news conference.

“If the situation continues as is, we will not be able to offer the same services,” he added.

This is not the first time a state official has discussed raising fares for the always busy transportation, one of the fastest and most inexpensive means of transport used by an estimated 3.5 million Egyptians in greater Cairo.

In August, Egypt's President Abdel-Fattah El-Sisi said that while a one-way metro ticket for any direction costs riders EGP 1, the real cost to the state is more than EGP 10, adding that the last price increase was 12 years ago.

Egypt has repeatedly said it would raise the price of metro tickets to offset annual losses, but has yet to follow through.

The metro, which operates throughout the capital city and surrounding areas, runs at a speed of 80 kilometres an hour.

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