Egypt will never return to socialist policies of the 1960s, minister tells MPs calling for price controls

Gamal Essam El-Din , Wednesday 4 Jan 2023

​Egypt's Minister of Supply and Internal Trade Ali Moselhy dismissed calls by MPs to impose price controls on all basic commodities to contain soaring food prices.

 Ali Moselhy
Egypt s Supply Minister Ali Moselhy during the parliamentary session on Tuesday afternoon


“We will never return to the old socialist policies of the 1960s under late president Gamal Abdel-Nasser, meaning that we as a government will not intervene to enforce price controls or impose compulsory pricing on basic commodities and goods,” said Moselhy, urging MPs to “stop thinking of the Ministry of Supply in terms of the 1960s when Egypt was a full-fledged socialist country; we are now a free market economy.”

Moselhy made the remarks at a seven-hour parliamentary session on Tuesday afternoon, where more than 150 MPs called on the minister to impose obligatory pricing on goods and commodities.

“There is nothing in the constitution obliging us to enforce price controls or resort to compulsory pricing,” the minister said.

'We are not a wartime government'

Moselhy stressed that “we will not be a wartime government like the one that was in Egypt during the 1973 war under late president Anwar El-Sadat.”

“Under these kinds of governments during war time, all state authorities were fully mobilised to ensure that food products, commodities and goods were available on the market,” Moselhy said.

“Egypt is not currently in a state of war, not to mention that these kinds of wartime governments create problems, as they ignore other sectors like housing and services.”

The minister said that the law does give him the authority to enforce price controls, but only under certain conditions and upon the cabinet's approval.

“This happened in 2017 when we intervened to contain the soaring prices of sugar, and again in 2022 with rice to stand up to traders who stockpiled this basic commodity to sell on the black market,” said Moselhy.

The war in Ukraine will leave Egypt a victim of “imported inflation” for another two to three years, he said.

“To those MPs who say that the war in Ukraine is not impacting us, I say no, this war is negatively impacting all countries, including Egypt, and we will continue to suffer from its damaging effects for another two to three years,” he said.

“In fact, we are importing high inflation because of this war,” said Moselhy, “as Egypt imports more than 60 percent of its food needs.”

Moselhy added that the government is doing its best to contain the effects of this war, and that President El-Sisi has ordered that EGP 1.7 billion be allocated to creating a strategic stock of basic commodities.

'I am not a minister who creates crises'

Moselhy defended his record to the members of parliament, saying “I am a minister who has so far been capable of eliminating crises, and this was quite clear in solving the crises of the sugar shortage in 2017 and the shortage of rice in 2022.”

According to Moselhy, the state's authorities – particularly those affiliated with the ministries of supply, local development and the interior – are doing their best to stand up to greedy traders who stockpile goods to sell on the black market.

“We have directed watchdog bodies to ensure that all shops and retailers place price-tags on commodities, but let me say that it will be difficult to place price tags on all commodities and goods due to logistical problems," said Moselhy, adding that “the government is currently drafting a new law regulating haphazard retail markets.”

MPs open fire on Moselhy

Moselhy's statement to parliament was in response to attacks from MPs from both the majority and opposition parties, who teamed up yesterday to accuse him of doing nothing to tighten controls on the food market and contain the soaring prices of basic commodities.

“The supply ministry is not exercising its role in exerting control over retailers that have a free hand in raising the prices of basic food commodities at the expense of low-income citizens,” said MP Amr El-Kotami.

“The ministry's control over the local food markets does not exceed 1 percent, and as a result citizens have been left prey to greedy traders who stockpile goods to sell at inflated prices,” Kotami said.

MP Nafie Abdel-Hadi called for Moselhy “to resign or be forced to resign.”

MP Olfat El-Mezlawi described Moselhy as “the minister responsible for creating crises.”

“You are laying off problems and crises on MPs in their districts because of your ineffective policies,” said El-Mezlawi, accusing Moselhy of failing to impose controls on bakeries – causing long queues for subsidised bread – and stripping many low-income citizens of ration cards.

El-Mezlawy said that under Moselhy, the supply ministry has turned into a ministry of “black markets and greedy traders.”

Many MPs also complained about the discrepancy in the prices of strategic goods between different retailers, claiming that the price of rice can range from EGP 15 to EGP 23 a kilo depending on the outlet.

Moselhy admitted that there is a shortage of “retail market inspectors since the government stopped appointing new employees a long time ago.”

“But the Consumer Protection Agency is doing a good job, and in the end let me stress that prices will go down only when the dollar price does down,” Moselhy said.

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