egypt fuel price hikes fan inflation fears
Last Updated : GMT 07:25:12
Arab Today, arab today
Arab Today, arab today
Last Updated : GMT 07:25:12
Arab Today, arab today

due to government austerity measures

Egypt fuel price hikes fan inflation fears

Arab Today, arab today

Arab Today, arab today Egypt fuel price hikes fan inflation fears

An attendant counts cash at a petrol station in Cairo
Cairo - Arab Today

Hisham Gaber had been preparing his wedding for months, but started to have second thoughts as inflation in Egypt rocketed due to government austerity measures, including sharp increases in fuel prices.

"Marriage and handling the additional burdens in these conditions have become an unsound decision," said the 28-year-old engineer.

The government on Thursday announced an increase in fuel prices of up to 55 percent, the second since November when it also floated the currency in an IMF-backed reform programme, which fuelled inflation.

Analysts believe the fuel price rises will further increase inflation although it was announced to have decreased in May to an annual rate of 30.9 percent, from 32.9 percent the previous month.

"Prices are still rising but not as sharply as before," said Amr Adly, an analyst with the Carnegie Middle East Center.

Radwa El Sweify, an analyst with Pharos Holding for Financial Investments, believes that inflation will spike.

"Inflation over the next two months may rise to 34-36 percent but the rate of inflation in the last two months of this year will be less than the same period last year when the pound was floated," she said.

The pound has depreciated sharply from 8.8 per dollar to 18 -- following its flotation, which came after the International Monetary Fund agreed a $12 billion loan disbursed over three years.

The move, in a country that relies on imports, drove inflation to a record high in April.

"The exchange rate is key to price fluctuations in a country where food and medicine make up more than 40 percent of imports," said Adly.

-'Prices have tripled'-

The government has announced a raft of measures to protect low income Egyptians, saying it boosted social spending to 75 billion pounds ($4.1 billion).

About 28 percent of Egypt's 90 million people are poor, according to official figures from 2015.

But government social spending will cover only between 40 percent and 50 percent of the recent price hikes, said El Sweify.

"The government doubled social spending, but prices have tripled," she said.


With the latest fuel increases that affect transport costs, the prices of vegetables and fruits may rise by between 20 and 25 percent, said Omar El Shenety, the founder of Multiples Group, an investment firm.

Prime Minister Sharif Ismail said the fuel subsidies were straining government financing.

The projection for next year at the same levels "is 150 billion pounds. This is a big number that neither the oil sector nor the budget can handle," he said at a press conference.

But despite widespread consternation among Egyptians, it is unlikely that the soaring cost of living will lead to unrest, El Shenety said.

"The government's conviction that there will not be a backlash by people allowed it to make these reforms forcibly," he said.

Economic grievances had fuelled the 2011 uprising that overthrew veteran strongman Hosni Mubarak, ushering in years of unrest that decimated tourism and investment.

Many Egyptians now are weary of further unrest, while the government shows little tolerance for dissent, having jailed thousands of Islamists and secular dissidents over the past few years.

President Abdel Fattah al-Sisi, the former army chief who toppled his Islamist predecessor Mohamed Morsi in 2013, has said the country has no choice but to undertake the tough economic reforms his predecessors had put off, fearing unrest.

Source: AFP

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

egypt fuel price hikes fan inflation fears egypt fuel price hikes fan inflation fears

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

egypt fuel price hikes fan inflation fears egypt fuel price hikes fan inflation fears

 



Arab Today, arab today Modern colorful bedroom renovation

GMT 11:23 2017 Thursday ,21 December

Modern colorful bedroom renovation
Arab Today, arab today For the Variety of Interior Design Styles

GMT 11:14 2017 Tuesday ,19 December

For the Variety of Interior Design Styles

GMT 15:46 2018 Wednesday ,12 December

Festive Fashion by Dubai-based designer ASMARAÏA

GMT 11:33 2014 Tuesday ,11 November

Death of Egyptian actress Maali Zayed at 61 years

GMT 13:32 2018 Thursday ,22 November

Russia's Sovcomflot considers acquiring LNG-fueled ships

GMT 10:15 2017 Wednesday ,08 February

Chocolate cornflake cakes

GMT 06:16 2016 Friday ,07 October

Vietnam — A trip worth bragging about

GMT 07:01 2016 Monday ,09 May

Ahmed Al Kaabi named UAE's governor for OPEC

GMT 14:35 2017 Wednesday ,23 August

Nawal Al-Zoghbi will participate in Concert

GMT 10:42 2015 Saturday ,01 August

6000 tons of butane gas arrives at Zeiteyat port

GMT 10:51 2017 Wednesday ,22 March

Singer Nancy Ajram praises her mother

GMT 15:10 2018 Sunday ,09 December

President Abbas to address Fatah Advisory Council

GMT 22:32 2017 Monday ,04 December

Yemen's ex-president Saleh killed in attack

GMT 08:13 2017 Wednesday ,02 August

Darine to be honored in festival for 'White Paper'

GMT 14:21 2017 Wednesday ,29 March

Malabar Gold opens 12th Saudi showroom in Hail

GMT 13:38 2017 Tuesday ,03 January

Funeral of Istanbul victim Wardini kicks off

GMT 10:44 2011 Sunday ,03 July

\'Soul Train\' artifacts go to Smithsonian

GMT 21:43 2017 Tuesday ,31 January

US travel ban punishes those 'fighting terrorism'

GMT 09:24 2017 Tuesday ,04 July

Ahmed Zaher happy for his successful year
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday