Egypt needs $3 bln monthly for basic commodities, fuel, electricity: Sisi on dollar crisis

Ahram Online , Wednesday 24 Jan 2024

President Abdel-Fattah El-Sisi said Egypt faces a recurring dollar shortage crisis every few years primarily due to the government providing basic services to citizens in the Egyptian pound while needing to purchase them in dollars.

Food
A woman and a young girl in a local shop in Egypt. American University in Cairo.

 

The Egyptian government spends $3 billion a month for basic food commodities, fuel – excluding local production – and natural gas needed to generate electricity, El-Sisi said on Wednesday during the Police Academy celebration on the 72nd anniversary of Police Day.

The government, he explained, buys basic commodities (such as wheat and cooking oil) for $1 billion a month and spends $2 billion a month to provide fuel and gas needed to generate power.

However, the state sells these goods in Egyptian pounds, not dollars, he said.

“This is the challenge that Egypt has been facing even before 2011,” El-Sisi added.

The president urged the country to maximize its dollar resources so that they match or even surpass its spending in hard currency.

This could be achieved through increased exports, remittances from Egyptians abroad, as well as revenues generated from tourism and the Suez Canal, he clarified.

Driven by the shortage of hard currency and the depreciation of the Egyptian pound, prices of all commodities – including necessities – have unprecedentedly soared recently.

El-Sisi also highlighted the economic consequences of the 25 January Revolution in 2011, pointing out that the state lost over $450 billion between 2011 and 2013. Additionally, it spent over the past ten years more than EGP 120 billion in countering terrorism.

Egypt’s economy, El-Sisi noted, could not bear all these shocks, but it had no other choice in order to maintain its stability.

The president also stressed that the country’s stability lies not only with the government or the leadership but with all citizens, warning against attempts to turn public opinion against the state.

The president said that this is what happened before the 25 January Revolution. The state has worked over the past years to restore the relationship between the people, the government, and the interior ministry, he added.

“I am saying this now because we must always be united. Any difficulties will pass if we are together. We are all one,” he asserted.

El-Sisi said the economic condition has been further complicated due to regional and international developments, including the pandemic, the Russian-Ukrainian war, and most recently Israel’s war on Gaza and its impact on navigation in the Red Sea.

A new round of National Dialogue
 

El-Sisi also called for the launch of a second round of national dialogue with a more profound and comprehensive approach to discuss the current economic challenges.

El-Sisi also welcomed all economic suggestions but asserted that ”there is a difference between giving an opinion and implementing that opinion” as a state dealing with further complexities, including public opinion and various circumstances.

He expressed his agreement with those requesting tighter market controls to manage prices.

The solution is not only the responsibility of the government but the citizens as well, he added. 

The president expressed his appreciation for Egyptians, especially those with low income, stressing that he never encountered one of them complaining about the conditions.

"Everything pales by comparison with our country. We eat and drink, and everything is well, even if they come at a high cost," El-Sisi said.

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