Reuters – Egypt’s Finance Minister said on Sunday spending on energy subsidies next year will be 10-12% above the EGP 130bn ($18.66bn) budgeted for the current fiscal year, unless immediate reforms are made.
Successive governments have stressed the importance of reducing energy subsidies, which account for more than 20% of state spending, but none have taken concrete steps to do so.
Finance Minister Hany Kadry Dimian did not say whether any reforms would be implemented during the next fiscal year that begins in July, according to state news agency MENA.
Dimian said restructuring of the subsidy system needed to involve price increases and “rationalising distribution quotas”.
A growing population and a decline in the pound have steadily pushed up the subsidy bill in the past two years.
Last year’s energy subsidy bill was more than EGP 120bn ($17.22bn), up from EGP 115bn the previous year.