Egypt withdrawal from UN grain treaty due to lack of benefits during Ukraine-Russia crisis: Minister

Ahram Online , MENA , Sunday 19 Mar 2023

Egypt decided to withdraw from the decades-old United Nations Grains Trade Convention (GTC) because it had not received the desired benefits from the agreement during the Ukraine-Russia crisis, announced Minister of Supply and Internal Trade Ali Moselhi on Saturday.



The convention aims to provide countries with the necessary supply of grains and to maintain a balance of trade for both consumers and producers, according to Moselhi.

However, during the Ukraine-Russia crisis, the agreement failed to achieve these objectives, he stressed.

Moselhi made the remarks to press on the sidelines of the Ahlan Ramadan fair in 10th of Ramadan city in Sharqiya governorate, state news agency MENA reported. The fairs, which are being held across the country ahead of the holy fasting month of Ramadan, offers foodstuffs and other consumer goods to citizens at discounted prices.

On 13 February 2023, Egypt, notified UN Secretary-General Antonio Guterres of its decision to withdraw from the Convention effective 30 June 2023 in accordance with Article 29 of the convention.

The GTC is the only international treaty of its kind that covers trade in grain.

Egypt has been a member to convention since its establishment in 1995 and has been a member of its governing council.

During the Russia-Ukraine conflict and the 2008 financial crisis, the convention did not intervene to achieve any balance in the market. Instead, prices of wheat have significantly increased from $150 to $520 per ton, Moselhi said.

He stressed that Egypt’s continued membership in the convention is pointless as its role is currently limited to information-sharing and collecting requests.

This has become superfluous as obtaining information has become easy thanks to technological developments, the minister noted.

In a statement to Reuters earlier in March, the Egyptian Ministry of Foreign Affairs said the decision to pull out of the treaty was made after the supply ministry concluded that Egypt's membership delivered "no added value."

Nader Nour El-Din, the former advisor to the supply minister at the General Authority for Supply Commodities (GASC) and expert on international grain and food stock exchange, stressed the importance of "effective" agreements that can have influence over global markets and protect developing countries from rising prices.

Egypt has complained about unjust prices amid the global crises, Nour El-Din told Ahram Online in March, adding that they have found no justification the rise in wheat prices from $250 to $520 per ton.

As long as the markets are based on supply and demand, there is no point in the country's membership in this treaty, Nour El-Din pointed out.

Grain prices have soared worldwide following the onset of the Russia-Ukraine war in February 2022.

Egypt, the world’s top wheat importer, used to get 80 percent of its imported wheat from Russia and Ukraine prior to the conflict.

The country relies heavily on wheat for making bread, a main staple of the Egyptian diet. Egyptians consume almost 100 billion loaves of bread annually, made with around 18 million tons of wheat, according to government officials.

Moselhi told Reuters last June that Egypt needed to import five million tons of wheat for the fiscal year 2022/23.

Egypt's imports of wheat increased by 12.6 percent in the fiscal year 2021/22 to $2.40 billion, compared to $2.13 billion in the previous fiscal year.

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