Nadia, 38, is a mother of two and works as a maid. Her husband – the main provider in the family – earns LE 400 ($73) per month, an income that hardly meets the family’s basic needs.
“I used to be a stay-at-home mother, but the surge in prices forced me to work, said Nadia. “Enough is enough – how can we live with the soaring prices too? she exclaimed.
Nadia spends around LE 260 ($48) of her husband’s earnings on her daughter’s private lessons. All that s left for the four-member-family is LE 140 ($25), in addition to Nadia’s irregular income, which reaches a maximum of LE 550 ($100).
Due to the price hikes, Nadia, who resides in the modest district of Madinet As-Salam, explains how she cannot afford meat, chicken or dairy products anymore.
“We buy only half a kilo of meat every month. Meat is too costly for us, she explained, adding that the price of meat has reached LE 40 ($7) per kg.
The story of Nadia is not an uncommon one; it is the story of millions of Egyptian families who live on average incomes, whose already difficult lives have been further complicated by the recent hike in prices. In a country where some families live on less than LE 300 ($50) per month, Nadia’s life can be considered a “luxurious one.
An essential component of Egyptian families’ diet, bread has become an expensive commodity. As demand rises, standing in long queues for hours to get subsidized bread has become part of the daily routine of the underprivileged majority.
The official spokesman of the Ministry of Social Solidarity, Yehia Mahmoud, argues that the government is trying to combat the problem by increasing the number of outlets and by providing bakeries with more subsidized flour.
“Instead of 170, we now provide each bakery with 340 bags of subsidized flour, he explained.
According to the International Monetary Fund’s latest report on Egypt, the increase in wheat prices costs the government around $2.5 billion extra in subsidies. One of the world’s biggest wheat importers, Egypt, is expected to suffer from ongoing global inflation.
“The current food-price crisis is more serious than previous ones because it is linked to oil prices, said Adel Beshai, professor of economics at the American University in Cairo.
The ripple effect of the soaring cereal prices could be felt on other basic commodities, a hike that has affected the life of most Egyptian families considerably regardless of their financial status.
According to Amal, a 54-year-old engineer, the surge in food prices urged people to “reduce their consumption, introduce changes to their diet, or eliminate certain products from their shopping lists.
“The prices of cooking oil and butter have almost doubled, she added.
Nermeen, 32, is a middle-class housewife. She explained that some of the products affected by the hike include butter, rice, cheese, sugar, eggs, vegetables and meat.
Though subsidies mitigate the effect of the soaring prices, not all Egyptians benefit from them, with some observers arguing that the government will not be able to sustain them for long.
Around 55 million Egyptians, according to Mahmoud, use ration cards to purchase subsidized food products.
Introducing changes to the existing subsidy system has recently been the subject of a heated public debate. Last year, the government put forward a proposal to replace food subsidies with cash distributions, a suggestion that resulted in a public outcry, especially among the lower classes, who believe that cash funds will not be able to catch up with the spiraling prices.
“People are expressing different opinions on the issue of introducing modifications to the subsidy system, but there are no [official] decisions yet, Mahmoud told Daily News Egypt.
Although Nadia had not heard of the government’s proposal before, she expressed her discontent. “They [the government] will give us money? They only want to take money from us.
In 1977, a massive popular rebellion erupted as a result of subsidy cuts. Thus, eliminating food subsidies or even replacing them can result in domestic unrest.
Over the years, providing subsidized food, particularly bread, has come to be seen as part of the government’s responsibilities. “Offering people bread at affordable prices is our duty, Mahmoud said.
“Eliminating or replacing subsidies on bread is improbable, said Beshai, who blames the bakeries that smuggle subsidized flour to the black market for the shortage of subsidized bread.
While Beshai merely wonders why the government can’t exercise enough supervision over bakeries, many Egyptians, however, blame the government for the ongoing saga of food price problems.
Nadia attributes the surge in food prices to the fact that “people are silent.
Now, she explained, people buy half the quantities they used to buy in the past because of the spiraling prices without complaining.
The government, according to Mahmoud, has launched a campaign to punish those who sell subsidized flour on the black market. “We have managed to prevent 260 tons from being sold on the black market recently, he said, adding that there is a hotline for reporting illegal usage of subsidized commodities.
“Egypt should wake up and think about solutions to its problems. We should grow wheat on a massive scale. This is more pressing than any other national issue, said Beshai.
Yet, what makes the burden heavier on the government is that the skyrocketing prices in Egypt are partly a reflection of a global hike in food prices.
Geoff Benson, associate professor of agriculture economics at North Carolina State University, attributes the global surge in food prices to the increase in income and demand for food in Asia, particularly China.
Benson also argues that the increase in oil prices is another reason behind the soaring food prices. “Energy costs have an indirect effect . because they affect the cost of the inputs that farmers and food processors buy and use to produce our food, he told Daily News Egypt.
Some observers also ascribe the current crisis to biofuels.
The United States’ policy of using American corn (maize) for the production of ethanol, according to Benson, resulted in an increase in the world price of maize. “[Maize] is a food crop and also a major component in animal foodstuffs, and, therefore, raises the cost of production.
“Because maize production became more profitable, US farmers planted more maize and reduced plantings of other crops … This resulted in reduced production and, therefore, higher prices for these crops too, he added.
Squeezed by high prices and low salaries, Egyptians are left with no viable solutions.
“If prices surge again, we will not be able to survive. Are we supposed to resort to stealing? asked Nadia.
A couple of months ago, real estate tax employees staged a strike, complaining about their low salaries following a wave of strikes that swept Mahalla El-Kobra, home to the largest state-owned textile factory. Also, physicians attempted to stage a public protest, but were prevented by security forces. The most recent in the series of strikes involves university professors, who were also asking for better pay.
“Some of my friends who have been working for the government for 17-18 years earn less than LE 400 ($73) per month, said Amal.
Benson suggests that “[even] if there are no production problems, the price increase we have experienced are likely to stay for the foreseeable future.
Expressing a similar viewpoint, Beshai believes that the economic future is gloomy because the current crisis is expected to last for a few years.
