Egypt will slash its total subsidy bill in the new budget by 14 percent in the coming fiscal year 2016/17 compared to the current fiscal year to end in June, according to the latest data from the finance ministry.

The 2016/17 draft budget published on the ministry’s website on Sunday showed the total subsidy registering EGP 130.1 billion, of which EGP 46.3 billion are allocated for a food and farmers’ subsidy.

However, as President Abdel-Fattah El-Sisi commissioned the government in April to compensate low-income earners for food price hikes caused by the fluctuating price of US dollar price in recent months, the finance minister Amr El-Garhy told the parliament on Sunday that the food and farmers’ subsidy bill would increase by an additional EGP 2.5 billion to approach EGP 49 billion during the coming fiscal year.

Accordingly, the total bill will amount to EGP 132.6 billion versus EGP 154 billion in the current fiscal year.

Egypt embarked on a fiscal reform programme in July 2014 in an attempt to curb the growing state budget deficit through cutting subsidies and introducing new taxes including the value added tax.

The government plans to trim the petroleum subsidy bill by 43.5 percent to reach EGP 35 billion and the electricity subsidy bill by 6.4 percent to EGP 29 billion in 2016/17 comparing with the current fiscal year due to the falling in the global oil prices, the ministry said.

In December, oil minister Tarek El-Molla said that the decrease in global oil prices is expected to reduce the current fuel subsidy cost to save around EGP 7 billion to the public treasury.

On Monday, global benchmark Brent futures were down $1.06 at $47.66 a barrel on track for a fourth straight day of losses for the first time in a month, Reuters reported.

*The official exchange rate for $1 = EGP 8.78