Egypt's leftist Tagammu Party calls for national dialogue over bread subsidies

Gamal Essam El-Din , Saturday 21 Aug 2021

Tagammu MPs said lifting bread subsidies is a high sensitive step that should come only after a national dialogue

Egyptians buy bread from a bakery in Cairo (AP)
Egyptians buy bread from a bakery in Cairo (AP)

A number of Egyptian lawmakers affiliated with leftist "Tagammu" Party have urged the government not to take the "perilous" step of lifting bread subsidies, as millions of Egyptians live under the poverty line.

Egypt’s President Abdel-Fattah El-Sisi announced on 14 August that subsidies to bread could not continue as they are, and that there is a pressing need to "restructure" these subsidies.

MP Atef Meghawri, the parliamentary spokesman of Tagammu Party, said in a statement the government should only move towards restructuring subsidies in general, not eliminating them.

Meghawri said there are fears that the Ministry of Supply took President El-Sisi's directives as a green light for lifting bread subsidies.

"And so we call for a national dialogue, with the participation of parliament and civil society organizations, over bread subsidies because this issue is of a major concern for millions of Egyptians," he said.

"Recent statistics show that 30 percent of Egyptians live under the poverty line and that the issue of bread subsidies is a matter of life and death for them," Meghawri pointed out

Meghawri also argued that raising minimum wages for state employees to EGP 2,400 per month should not be an excuse for lifting bread subsidies.

"This sector of citizens were required over the last month to pay higher electricity and fuel prices and it will be economically painful for them to also pay for higher bread prices," said Meghawri.

Marcel Samir, another Tagammu MP, also warned that lifting bread subsidies will be very costly for the majority of Egyptians. "This decision will negatively affect the living of at least 70 million Egyptians who use ration cards to get subsidized bread," said Samir.

Samir added that "the recent rise in electricity, fuel, and natural gas prices pushed inflation rates in Egypt to jump to 5.9 percent in July, up from 4.9 percent recorded in June 2021."

"We expect inflation rate to get higher in the next months if the government decides to raise train and underground metro ticket prices," he said, adding that "as a result, the talk on lifting bread subsidies comes at a very crucial time and it will be very hard for the majority of Egyptians to bear the burden of higher inflation in the coming period."

Ahmed Shabaan, a Tagammu senator, said "he has no doubts that the government is under pressure from the IMF to lift bread subsidies."

"The government forgets that it is poor and limited income Egyptians who footed the bill of the IMF-inspired economic reform programme between 2016 and 2019," said Shabaan.

 Those categories also suffered so much because of the coronavirus as many of them lost their sources of living because of the anti-pandemic protective measures."

"And now the government comes to tell them that you are going to pay more for electricity, fuel and bread," said Shabaan, urging the government not to take any final decision in this respect before it is put up for a national dialogue in parliament.

"A hasty decision on bread subsidies could cause a wide-ranging social unrest, but with national debate in parliament and among civil society organizations we could all agree on rationalizing subsidies in general without hurting poor and limited-income citizens," said Shabaan.

Statistics released by the Ministry of Finance show that number of citizens who receive subsidized bread fell from 82 million in fiscal year 2016/17 to 69.2 million in FY 2020/21, and that allocations to subsidized bread in FY 2021/22 will reach EGY 50.6 billion.

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