Big rise in cooking gas prices in Egypt
Egypt is to dramatically increase the cost of cooking gas cylinders ahead of a vist by the IMF (Abid Katib / Getty Images)
Click here to add International Monetary Fund as an alert
Disable alert for International Monetary Fund,
Click here to add Mohammed Morsi as an alert
Disable alert for Mohammed Morsi,
Click here to add Reuters as an alert
Disable alert for Reuters,
Click here to add World Bank as an alert
Disable alert for World Bank
Egypt is to increase the price of cooking gas on Monday, Reuters reported.
One cooking gas cylinder will now cost EGP8 ($1.17), up by 60 per cent, for domestic users. Commercial buyers will have to pay double that the original price for each cylinder.
As part of the loan agreement, the government will have to reduce overall government expenditure, including on subsidies. It is the first time 20 years that the cost of cooking gas has been raised and is politically risky for embattled President Mohammed Morsi.
Government subsidies on key commodities such as bread and fuel account for approximately half of all government spending.
In March, the government reduced the subsidies on bread and discounted fuel is to be rationed in parts of the country via a smart-card system.
In 1977, Egypt saw widespread rioting caused by a hike in the cost of bread after IMF and World Bank -mandated changes in state subsidies for bread, leading to a massive cost increase in the staple.
- So cool it's hot: Saudi Arabia's $3.2B HVACR market driven by construction boom
- US, EU protectionist policies may be a blessing in disguise for GCC suppliers
- Dubai to Doha: How far can you stretch your dirham?
- OPEC's poor history of compliance will make production cut deal a challenge
- Jordan raises $400M for first phase of Red-Dead project